DOW JONES NEWSWIRES
Apple Inc.'s (AAPL) second-generation Apple TV costs $63.95 to
manufacture, according to a breakdown by technology researcher
iSuppli.
Compared to the first generation Apple TV, the new model offers
a "dramatically improved ratio of hardware cost to retail price."
The initial version appeared to be a near giveaway or subsidized
product for Apple, iSuppli said, sold at prices that weren't much
more than the underlying hardware costs.
With the second generation, Apple's price of $99 is about 35%
above its bill of materials and manufacturing cost. However, even
with that improvement, iSuppli said the second-generation Apple TV
is at the bottom end of the hardware margin spectrum for Apple
products.
ISuppli's analysis of the product found its internal design and
key components are almost exactly the same as the company's iPad
and iPod Touch. It added that while no two Apple designs are
identical, "the commonality of elements and features among the
Apple TV, iPad, iPhone 4 and iPod Touch is striking."
The Apple TV continues to exhibit the industry-leading
electronic and industrial design so evident in Apple's recent
products, including the iPhone 4 and the iPad, iSuppli said.
Analyst Andrew Rassweiler said the latest Apple TV's A4 processor
core, Wi-Fi/Bluetooth chip and power management chip are the same
building blocks used in those other devices.
As with so many other Apple designs, Samsung Electronics Co.
(SSNHY, 005930.SE) is the marquee component supplier for the Apple
TV. It dominates the applications processor subsystem, which is the
most expensive section of the TV at a cost of $16.55, or 27% of the
products' bill of materials and manufacturing cost. The second most
subsystem is the memory section, costing $14.
Apple shares recently rose 3.5% to $288.44. The stock is up 37%
this year.
-By John Kell, Dow Jones Newswires; 212-416-2480;
john.kell@dowjones.com