Guts of a 3G iPod Shuffle
iSuppli is reporting that the 3rd gen iPod Shuffle only costs a measly $21.77 to make. Apple is making such a huge profit on these little things. It is only a matter of time before the Chinese manufactures create a cheap clone to the shuffle.
Here’s a break-down of the parts:
- Processor - $5.98
- Storage unit - $6
- Lithium Ion Battery - $1.20
- This leaves only about $9 for the case and screen
“That’s about 28% of the device’s retail price. The smaller the component cost as a percentage of price, the higher the potential profit. This suggests the per-unit profit margin on the shuffle is higher than on other iPod models. The component cost for the first iPod touch released in 2007, for instance, amounted to about $147, or about 49% of its $299 retail price. The component cost of the third-generation iPod nano, also released in 2007, amounted to about 40% of its retail price”
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TwisterMc // 13/04/2009 at 8:08 am
People always forget about labor. That’s usually 50% of any total bill.
kate // 13/04/2009 at 9:49 am
plus R&D, advertising, overheads in the stores… I’m sure they still make a decent profit but you can’t really deduce how “huge” it is from these figures…
Justin Rhodes // 13/04/2009 at 11:41 am
These Shuffles are smaller than your house key…how much labor does it really take to put some together?
redwall_hp // 13/04/2009 at 2:54 pm
@Justin Rhodes If I give you the parts, could you put it together?
Alex Jordan // 13/04/2009 at 7:04 pm
I have a tendency to listen to this man. http://daringfireball.net/linked/2009/04/13/isuppli-shuffle. This may very well be the component cost, but Apple simply isn’t making that much per unit.