Iphone a bit too expensive
The consulting firm on Thursday released an analysis of what the total component budget will likely be for the Apple iPhone. The $499 iPhone, which comes with 4GB of memory, will likely have a component budget of $229.85. Assembly costs will raise the total manufacturing price to $245.83, according to the analysis.
Meanwhile, the $599 iPhone, sporting 8GB of memory, will have a component budget of $264.85, with a total manufacturing cost of $280.83, according to the report.
The large margins make price cuts inevitable.
"They will cut prices later on," said Jagdish Rebello, director and principal analyst with iSuppli. "It is hard to imagine anyone else getting 50 percent margins for long."
Other manufacturers of high-end multimedia phones get about a 20 percent margin. That would put the retail price of an 8GB iPhone at around $350 without subsidies from the cellular carrier.
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