iSuppli has published a teardown analysis of the iPhone 4S, pricing the various components and ultimately concluding that the 16GB model has a bill of materials of just £120.
The other models weigh in at £130 (32GB) and £155 (64GB).
The SIM free prices in the UK are £499, £599 and £699 respectively.

this must be one of the largest markups of any phone out there, any figures for other phones. This doesnt take into account any other costs such as manufacture but no other phone maker surely has this margin which is huge.

The Galaxy and Sensation come in at a similar price parts wise... So your point is....?

you do know that there are other costs, right?

Iain

Welcome to living in a capitalist society. I'm sure the same can be said of many retail products. I'm willing to bet that it costs Kelloggs nowhere near £2 for the raw materials involved in making a box of cornflakes

Of course as you mention the figures quoted do not take into account any expenses involved in manufacturing, nor research and development, distribution, retail overheads, staff wages or any of the other costs involved in the process. I'm sure if you did factor these things in the markup wouldn't be anywhere near as high. But of course if you did include them, you wouldn't be able to make it seem like the markup is more than it is

And Apple's markup as a % isn't even that high. I've seen (and sold) products and services with a markup of over 1000% which is much higher than the 300% or so apple markup assuming the figures in the OP are accurate which for reasons already discussed we have established they aren't

The biggest cost in most products is not the cost of the raw materials. If it were, the primary factor in the pricing of software would be how thick the manual is and wouldn't cost any more than a fiver.

It's pretty meaningless unless you count the cost of all the overheads. We can speculate, but nobody except Apple would know the true cost. However, I'm sure they make a nice big profit from iPhones. They no doubt make more in total from iOS devices then the Macs. Yet they don't seem that interested in the budget end of the market where margins are far lower. The mythical iPhone 'Lite' has yet to materialise - but would be very interesting if it ever does.

I seem to recall Apple runs at between 30-40% margins.

Do they? have you the figures for this then? My understanding is the galaxy screen is very expensive.
However assuming you are right which I doubt the galaxy sells for around £400 and the nexus for £500 that would be my point

Of course the phone had other costs involved as I have mentioned but the biggest cost ad a percentage of each phone is the materials. Everything added together manufacturing advertising transport wont add up to that percentage of the iPhone.

30% is a pretty standard mark up in shops.


They also failed to include 20% VAT.

Exactally 20% of the iPhone cost goes to David Cameron and his croneys! Apple remember have their own retail stores which are not cheap to run... Where are the Nokia, Samsung Mobile, HTC stores in UK??? Oh yeah there isn't...

The price of a REPLACEMENT S2 screen is going for around the same as a iPhone 4S screen. A tiny bit more expensive in some places as the phone doesn't have quite as many people selling parts for it.

Apple do not make unusually high profits on the hardware its the Apps, cut of line rental/charges from network operators, iAds and purely the amount of them they are selling!!


As for an iPhone lite there is no need when there is a healthy demand for the 3Gs & 4 currently (the 3Gs sold out last week in the States!!). So it's introduction is unlikely and frankly not needed... The last generation iPhone is still better than lots of entry level phones, mid level etc. Especially considering all iPhones currently being sold support iOS5

so they did

So that means apple are selling a 16GB for £415.83, 32GB for £499.17 and a 64GB for £582.50. Which reduces the markup quite a bit without even factoring all the numerous other overheads in

How much do they cost in the US?

Don't think you can get them sim free in the US. US pricing tends to be subject to a 24 month contract

That iSuppli stuff is very conservative.
It uses known pricing and fails to account for bulk discounts which can amount to 80%.

Lack of discounts It is also why manufacturers are complaining about Intels high ultrabook chip prices.
They cost 10+ times that of the Atom which Intel cripples and bars from use in decent sub notebooks.