
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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