This shouldn't come as a shock to anyone: just because Apple's touting the "magical" $499 pricepoint of the iPad doesn't mean they're selling it at a loss. After carefully poring over the iPad's internals, iSuppli has waved its hands in the air and added up a thoroughly guesstimated bill of materials as low as $259.60 for the 16GB iPad, including $95 for screen and $26.80 for the A4 processor. Sure, we suppose we can believe that, although that number doesn't really explina the final price tag, since it fails to include include gigantic costs like, oh, say, "development." The good news for us is that there's actually a lot more complexity inside the iPad than iSuppli was expecting, and that means the raw component prices might come down over time as things like the three-chip touchscreen controller get simplified over time. What might seem silly and wasteful at $499 could seem all-too-tempting at $299.

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iSuppli pegs iPad component costs at as little as $259.60