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Samsung's Galaxy S6 Edge is ridiculously expensive to make
It's no secret that Samsung's curvy Galaxy S6 Edge costs a pretty penny, but there's now a good explanation as to why. IHS estimates that the raw price of assembly for a 64GB Verizon model is $290. That's more expensive to make than not just the Galaxy S5 ($256 when new), but also the 128GB iPhone 6 Plus ($263) -- if true, Samsung is giving up a lot of profit to make this exotic hardware affordable. The bendy AMOLED screen is unsurprisingly the costliest element here with an estimated $85 price, although the Exynos 7 processor ($30), 3GB of DDR4 memory ($27) and flash storage ($25) certainly aren't cheap.
IHS teardown: Apple nets $224 on each 16GB WiFi iPad Air 2 it sells
Despite its upgrade, the iPad Air 2 shares a nearly similar bill of materials as its predecessor, claims IHS following its teardown analysis of Apple's latest tablet device. According to the analysis, the entry-level $499 16GB WiFi-Only iPad Air 2 costs Apple $275 to manufacture as compared to $269 for original iPad Air. The biggest difference between the device generations is the Air 2's increased storage options, which saw Apple replacing the previous 16/32/64 configurations with 16/64/128GB. Apple kept the pricing constant, which means these higher capacities are biting into Apple's profit margins. "The Air 2 delivers a series of refinements compared to the original Air but features nothing earthshaking," said Andrew Rassweiler, senior director, cost benchmarking services for IHS. "With largely identical display specifications and minor improvements in most other areas, Apple continues to offer evolutionary upgrades to the iPad lineup. It's interesting to note that by offering the consumer a 128GB model for the same price as last year's 64GB iPad Air, Apple actually has taken down our estimated margins a bit on both the 64GB and 128GB models. The increased memory configurations to 64GB and 128GB are some of the key upgrades here." The most expensive component is the 9.7-inch IPS display, which is estimated to cost $77. Following in price is the mechanical and electro-mechanic components at $44, the touchscreen at $38 and the wireless components (BB/RF/PA) at $33. The cheapest parts are WLAN/BT/FM/GPS modules and the box contents which cost $5.
Teardown suggests Xbox One manufacturing cost of $471
The Xbox One costs Microsoft $471 to build, according to a hardware teardown and analysis by research firm IHS. IHS also cracked open the PlayStation 4 to find that Sony spends $381 building its latest home console. The bill of materials for the Xbox One amounts to $457, with the assembly and manufacturing of the system estimated at $14. IHS says that the Xbox One's Kinect camera adds $75 to the total cost of the Xbox One, including assembly, $11 more expensive than the original Kinect's bill of materials and manufacturing costs. Among the other components that factor in to the system's cost for Microsoft is a Blu-Ray drive manufactured by Lite-On that accounts for $32 of the Xbox One's bill of materials, and the system's $25 external power supply unit.
PS4 costs $381 to make, according to hardware teardown
The PlayStation 4 costs $381 for Sony to build, $18 under its retail price of $399. The figure comes from a hardware teardown by research firm IHS that included the bill of materials, which amounts to $372, as well as per-unit cost of assembly in the assessment. The teardown notes that the system's processor and memory account for about half of the cost of the entire console at $188, and that the PS4's 500 GB hard drive is $1 cheaper than the 120 GB one found in the PS3, thanks to the "major decline in HDD costs during the past four years." Sony Computer Entertainment CEO Andrew House said in August that the system "will not generate anything like the losses we did for the PlayStation 3," which amounted to $3.5 billion in 2007 and 2008, after the PS3 launched in November 2006 for $599. IHS' teardown of the PS3 at the time found that the system cost Sony $805, and the company still lost roughly $40 per system as of December 2009. The PS4 is off to a good start, as Sony sold one million units in the console's first day at retail. Sony addressed a few issues with launch systems, estimating that the number of problematic PS4 consoles is less than one percent of those shipped.
Daily Update for September 24, 2013
It's the TUAW Daily Update, your source for Apple news in a convenient audio format. You'll get all the top Apple stories of the day in three to five minutes for a quick review of what's happening in the Apple world. You can listen to today's Apple stories by clicking the inline player (requires Flash) or the non-Flash link below. To subscribe to the podcast for daily listening through iTunes, click here. No Flash? Click here to listen. Subscribe via RSS
IHS: iPhone 5s component tally reaches $199, iPhone 5c costs $173
Though it has a new camera module, faster processor and fingerprint sensor, the components in the new iPhone 5s are only slightly less expensive than those in the iPhone 5, says IHS. Not surprisingly, the iPhone 5c is cheaper than either the iPhone 5 or the iPhone 5s. According to AllThingsD, which got an advanced look at the IHS report, the iPhone 5s costs US$199 to build, as compared to $205 for last year's iPhone 5. Components for the 16 GB iPhone 5s cost Apple $191, with another $8 tacked on for assembly. The jump to 64 GB of storage in the 5s bumps up the price by $11, bringing the final cost to $218 for the model. By using a colorful polycarbonate shell instead of aluminum, Apple is able to trim the cost of the iPhone 5c to $173 for the 16 GB model and $183 for the 64 GB model. These prices include $7 for assembly. Echoing what was said by iFixit, IHS says the new iPhone models are very similar. "I would say that they're almost the same phone, except that the 5s has the fingerprint sensor, the A7 processor and some newer memory chips that consume less power. Beyond that, they're basically the same," said IHS analyst Andrew Rassweiler.
Olympus Stylus TG-625 Tough adds AF light for tricky shots in rough situations
It's been awhile since we've seen Olympus tackle the more affordable side of its rugged camera lineup, which makes its latest entry feel overdue. The Stylus TG-625 Tough effectively replaces the TG-620 by adding something that's been commonplace in the camera world: an autofocus illuminator light to improve focusing at night or, more likely with this camera, when it's plunged 16 feet underwater. Outside of a new double-lock system, though, you're looking at the hardware that has defined most of Olympus' rugged line this year, including a 12-megapixel backside-illuminated CMOS sensor, a 28-140mm equivalent lens, 1080p movie making and a 3-inch LCD. The Japanese should get the TG-625 the soonest, on August 31st. There's no word on whether or not there's an upgrade on the way for the US, although we can picture it slotting into the American lineup without much trouble.
Flat-panel TV shipments to fall for the first time ever in 2012?
The past fourteen or so years have been a great run for flat-panel TV sales, but according to IHS (formerly iSuppli), that run is finally going to turn in the down direction in 2012. The expected drop off is predicted to be five percent, which still leaves the total TVs sold in 2012 at 37.1 million, more than a few dollars for sure. The fact that last year saw a modest one percent raise is as good of an indicator as any that the good times are over. Of course this is but a single prediction from a single analyst firm and we'll all have to wait until the year is over and earnings are announced to know anything for certain.
Amazon elbows past Samsung for No. 2 tablet spot in Q4, according to IHS
Amazon had some serious trombone action going on last year -- what with all the horn tooting it did about Kindle Fire demand. Turns out Amazon was on to something, as the company has apparently grabbed the No. 2 spot from Samsung for tablet sales in the last quarter, according to research firm IHS iSuppli. Based on its numbers, Amazon sold 3.89 million tablets during the fourth quarter, eclipsing Samsung's 2.14 million units. The numbers equal a 14 percent share of the tablet market for Amazon while Samsung grabbed an 8 percent share, down from 11 percent in the third quarter. The brisk sales came at a price for Amazon, which saw fourth-quarter profits drop since it sold Kindle Fire tablets at a loss. Amazon's tablet sales also were still below the 15.4 million iPads sold by Apple for the period. All the competition is apparently taking a bite out of Apple's market share, however, which fell to 62 percent in 2011, compared to 87 percent in 2010. Samsung did manage to hold on to the No. 2 spot for the year, but with rumors already swirling about new iPads plus the Galaxy Note 10.1, the tablet wars aren't likely to cool off anytime soon.
Report highlights iPhone 4S design changes
If you think the new iPhone 4S is just the same old iPhone a report in DigiTimes may have you thinking again. The publication quotes an IHS analysis which looks at some key under-the-hood changes in the new iPhone beyond the obvious faster processor, antenna redesign and addition of the Siri software. Wayne Lam, a senior IHS analyst says the iPhone camera is a 5 lens system, a first for any smartphone. The new camera is getting raves from users, and comparisons show it's a very high quality implementation for both still photos and high definition video. The report also praises the fact that the iPhone 4S can operate on multiple carriers using different cellular systems and frequencies. Here in the US, the same phone can work on AT&T, Verizon and Sprint. "No other handset OEM produces a single device for multiple operators and for multiple geographies on this scale." IHS also highlights other changes to processors and architecture in the iPhone 4S. It adds up to a significantly different user experience that is not obvious when just looking at the new iPhone but pays some big dividends for iPhone 4S owners.
Report suggests AirPlay affecting iTunes online movie share
At least, that's the conclusion research firm IHS came to upon seeing growth in Apple's online video sales. Apparently Apple, up against competition from Walmart (Vudu) and Amazon, saw its market share go up from 64.9% in the first half of 2010 to 65.8% in the first half of 2011. Not exactly stock-enlarging numbers, I realize. There's also the fact that this report leaves Netflix completely out of the equation. But IHS found that "...iTunes experienced the largest revenue increase growth among all online movie providers during the first half" which is very good news for stockholders. Obviously, Netflix still has the lion's share of online video rentals. Back in March NPD reported Netflix represented a whopping 61 percent of all viewings of "digital streaming and downloadable video." Apple tied with DirecTV and Time Warner in that survey, which was, again, video rentals, not sales. Note that Netflix doesn't sell you a movie -- you can only rent them. That distinction is the difference between the IHS report and NPD's. As to AirPlay, I'm not sure how much of a difference it makes to the average person. I would say the lower-priced Apple TV 2, which has been selling well, has become a gateway drug for video purchasers. IHS says AirPlay has "expanded the reach of iTunes to new platforms" but what new platforms? Your TV? I'd love to know how many people are renting or buying on their Mac, but watch on their Apple TV, or use AirPlay in some fashion. It's all in how you look at the numbers and purchasing patterns, and in the end Apple and each service knows more about this than any of us. Netflix is certainly a powerhouse, but, as Fortune's Philip Elmer-Dewitt points out, even Netflix stands in the shadow of DVD sales overall. We're a long way from ditching discs, apparently.
iSuppli: Apple iCloud could affect NAND Flash market
Apple's upcoming iCloud service could have a negative effect on the NAND Flash market says IHS iSuppli. The market research firm suggests a change from phone and computer-based storage to online storage could lessen demand for flash memory in the future. Of course, iCloud in its current from is a sync service, but this could easily change to a streaming and storage service in the future. This iCloud effect won't be felt immediately. Apple is expected to scoop up 30% of the available supply of NAND flash memory in 2011 and should keep its position as the world's largest buyer of NAND flash memory for the next several years. As consumers gradually move their digital libraries online, the demand for on-device storage could decrease by as much as 100 GB per user. This drop could have a serious impact on NAND flash suppliers like Samsung or Toshiba. [Via Digitimes]
iPad 2 production shortfall cause: LCD and speaker issues
IHS iSuppli cut its forecast for yearly iPad sales following Apple's earnings conference call on April 20. iSuppli predicts the Cupertino company will ship 39.7 million iPads in 2010, a 9.1 percent reduction from its earlier forecast of 43.7 million. Apple confirmed during its earnings conference call that iPad 2 demand significantly outpaced supply. The iPad 2 flew off the shelves in Q2, and Apple sold every tablet it manufactured. According to iSuppli, Apple's manufacturing is constrained by a shortage of the new speaker that graces the iPad 2. Unknown quality concerns with the LCD display may have also played a role in this less than optimal rate of manufacturing. Demand for the iPad is expected to be strong for the rest of the year with a continuing production shortfall limiting the total yearly sales. During the Q&A session after the earnings call, Apple would not comment on when the supply of the iPad 2 would catch up with demand. Fingers crossed it happens soon so that prospective iPad owners no longer have to camp out early at their local Apple Store each day. [Via MacRumors]
Apple maintains lead in mobile app store revenues, but its share is shrinking fast
Growth. You don't have to be Gordon Gekko to recognize that exponential growth in revenues is the mark of both a buoyant industry and, on an individual level, a healthy participant within it. Kudos must, therefore, be handed out to all the top four app stores globally, as each one expended its total revenues by over 130 percent between 2009 and 2010. Interestingly, Apple's growth looks to be slowing down as the App Store begins to reach a saturation point on smartphones, while Nokia's Ovi Store and Google's Android Market blossomed during 2010 by multiples of 7.2 and 8.6 times their 2009 size. Apple's share at the top has shrunken as a consequence, a trend that looks likely to continue when Windows Phone 7's Marketplace and the Ovi Store are melded into one through this year and beyond.
