Sunny Ahn's WebLog

Came across this article on news.com about the margin and cost breakout of the iPhone by Apple.  In summary, it states that based on the 4GB iPhone (priced at $499), the component costs are approximately $229.85 (46% of price), with assembly cost at about $15.90, raising the total manufacturing price at $245.83, giving it approximately a 50% margin.

With 8GB iPhone (priced at $599), component costs are $264.85 (44% of price), with assembly costs of $15.98, giving it a total manufacturing price of $280.83, with approximately 53% margin.  According to iSupply, the WiFi chip would be about $15.35, with the 8GB flash memory at about $70 (at current costs). 

Certainly the price of the phone will come down sometime after it is released on the US market in the summer of 2007, with most high end phones getting a 20% gross margin – pricing the 8GB iPhone at about $350. 

At the Macworld Conference & Expo today, Apple finally revealed its new mobile handset, the iPhone.  It has a number of core features includind the iPod, digital camera, smartphone and widescreen display.

The new input technology is called “MultiTouch” – thus the phone contains only a single home button, according to MacWorld.  The device is expected to come to the US market in June of 2007.

Source: Apple.com

It will be interesting to see how the public responses to a mobile device without any physical buttons.  While the cost for Apple will be less (no keyboard), the response by the public on touching the screen will be interesting – I for one am bothered by the fingermarks I leave on my iPod.  The one big advantage is the size of the screen, coupled with the OSX software – this will be a compelling device for anything visual, particularly for browsing the Internet and watching videos.  The web companies (Google, Yahoo) must be drooling at this…

Motorola has finally announced the launch of its Motofone phone – focused on the emerging market.  This is an important device for Motorola – slim iconic design for under $50 a device. 

http://www.mobiledia.com/news/54028.html 

While the Motofone, announced by Motorola back in July 2006, is scheduled for the 4Q 2006, there has been a lot of buzz and press on the device.  At 9mm thin, it is Motorola’s thinnest device year.  Interestingly, CEO Zander has claimed that the price of the device will be around $35.  Some interesting points on the device:

1) It’s EPD display from E Ink – the innovative, yet risky (and unproven) technology claims to have power saving characteristics, thin profile and high contrast – all important for those outdoors in emerging markets

2) Longer battery life

3) Basic device with stylish thin design

4) Easy Iconic display

How is Motorola going to make $$’s with such a low price point thru such a thin device (thin is certainly hard to do inexpensively)?  Can this be the hit in the emerging market, similar to how the RAZR was for the highend market for Motorola?  With 50 million RAZRs sold since 2004 and its new “iconic design” devices emerging every year, Motorola might have another hit on it’s hands… time will tell.