Nokia's
Although if you were to compare the component costs next to Apple's
Component |
Nokia Lumia 900 |
Apple iPhone 4S |
---|---|---|
Display and touchscreen | $58 | $37 |
Processor | $17 | $15 |
Memory | $27 | $28 |
Wireless chips | $38 | $24 |
Cameras | $18 | $18 |
Power management | $9 | $7 |
Mechanical and electro-mechanical | $18 | $33 |
Total component cost | $209 | $190 |
Unsubsidized retail price | $450 | $649 |
Gross margin ($) | $241 | $459 |
Gross margin (%) | 53.5% | 70.7% |
Source: iSuppli.
That's a pretty major margin advantage for Apple to enjoy on its newest iteration of the iPhone, which also helps explain why Nokia's overall gross margin of 27.7% last quarter hardly compares with the 47.4% gross margin that the iPhone maker enjoyed last quarter.
On the cost side, there are a couple of notable differences worth mentioning on why the Lumia 900 racks up more component costs than the iPhone.
The display and touchscreen combination costs much more on the Lumia 900, but there are two big differences. The Lumia 900 features a notably larger 4.3-inch display, compared with the 3.5-inch iPhone Retina Display. The Lumia 900's display is also an AMOLED display from Samsung, which are pricier to manufacture.
Both devices use wireless chips from Qualcomm
These cost estimates exclude things like manufacturing, marketing, distribution, or software R&D. Of course, Apple spends very little on R&D in percentage terms relative to its revenue, and Microsoft is the one pitching in the Windows Phone operating system on the Lumia 900.
Nokia's fate looks dimmer each quarter, with its first quarter smartphone market share getting slashed by nearly two-thirds and falling into single-digit territory as Samsung and Apple take over. Its margins aren't helping much, either.
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