Apple’s iPad mini Costs Just $188 to Make

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Those wondering whether Apple could have charged less for the iPad mini have their answer. A market-analysis firm says Apple has a 43% margin on this mid-range tablet.

Apple iPad mini TeardownAccording to iSupply, who disassembled the device and estimated the cost of its build-of-material (BOM) at $188 for the base mode, which sells for $320. That figure does not consider intangibles like the cost of assembly, licensing fees, advertising, and other overhead. Still, it shows Apple has a considerable margin.

Meanwhile, its rivals are pursuing other strategies. Both Google and Amazon have similarly-sized tablets which have close to the same BOM, but sell for much less. This is because their makers are willing to sell the hardware with lower margins in order to attract customers to their stores where they spend money on software, eBooks, music, videos, and more.

Apple also makes a considerable amount off of its iTunes Store, but apparently feels confident that consumers will pay more for its tablet than for their rivals.




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