Does that include shipping, packaging, marketing, design, research, legal, office space, utilities, software and all the rest?
Didn't think so.
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Thats not the point - this isn't an attack on Apple's pricing it's a typical industrial teardown BOM. You can get them for everything. Retail price is typically 2-4x BOM depending on how complex the product is and how long it will be in the market
It's interest to the consumer is when a cell phone company is charging you $500 for the phone AND locking you into a contract.
(but, you know, they're not charging $500 AND locking you into a contract right?)
They are if you getting an early upgrade ($399/$499).
This reminds me of the whole thing with pharmaceuticals. pills 2-X cost $.10 to make - the first pill, however, costs millions.
The first pill costs from $500,000,000 to $1,000,000,000 and that's just for FDA approval.
Source: http://www.pkdcure.org/Research/Resources/FDADrugDevelopment...
Unsourced claim here: saw somewhere that about 75% of the cost of medication goes to advertising. We're taught to believe that it's the R&D that's the expense, but it's not; it's advertising.
> Unsourced claim here: saw somewhere that about 75% of the cost of medication goes to advertising. We're taught to believe that it's the R&D that's the expense, but it's not; it's advertising.
A huge fraction goes to marketing. However, that includes doctor education, free pills for poor people, and so on. Which of those do you want to give up?
The amount that goes to nd-user advertising is relatively small. Since at least some of that gets folks to go to the doctor to fix something that they didn't know could be fixed, and thus improves their lives, I'm not convinced that it's bad. Then again, I think that the goal of a health system is to improve health, not control costs. (Hypocondriacs do their thing regardless of advertising.)
Why do people mix SG&A into COGS discussion?
We are talking gross margin here, not net profit.
According to this...no (from BW article): In 2009, iSuppli estimated that the components and materials used in the iPhone 3GS cost about $179. The materials costs on that device have since dropped to $134 as the prices of certain components have declined...
Pretty much. Apple is a public company... have you seen their profit margins?