Kindle 2 costs $185 to make
iSuppli did a teardown of the Kindle 2 -
- They claim the total price of the components is $185.
- The screen costs around $60.
- Details are scanty.
- They do not include the licensing costs for using the ARM processor.
- Here is a snippet of their main pic -
iSuppli tears apart Kindle 2
- The wireless card is supposed to cost $39.50.
BusinessWeek have a good article on the Kindle 2 teardown.
You should also take a look at the Kindle 2 teardown by iFixIt which is extremely well illustrated (and was done on Feb 23rd, 2009).
iSuppli have been tweeting at twitter -
Kindle 2 BoM is $185…E Ink Display Adds to the Fire.
Also check this for the different Kindle 2 layers – http://twitpic.com/2f6ob.
Rather disappointingly, their site’s Kindle 2 teardown page has no details. Overall, its a bit surprising that the components add up to just $185. Not sure if iSuppli are including any labor costs etc.
eReader Sales will be 3.5 million in 2009
iSuppli also released a report on eReader Sales projections in August 2008 and made some really optimistic projections -
Worldwide E-Book Display Forecast
(Shipments in 1,000s of units, $ Millions)2007 2008 2009 2010 2011 2012 CAGR Revenue 3.5 23.4 82.6 136.5 210.0 291.2 142.8% Units 150 1,026 3,591 7,182 12,209 18,314
Yes, that is 1 million+ eReaders sold in 2008 on the iSuppli projections chart. This was before Oprah – However, the Oprah Kindle effect was offset by the Kindle being sold out for most of the holiday season.
Digitimes has some more details on the iSuppli report -
In 2008, shipments of electronics reading devices were about 1-1.1 million units, with the Amazon Kindle accounting for 350,000-450,000 units, and the Sony Reader 250,000-300,000 units …
… According to iSuppli, electronic reading device shipments are estimated to reach 3.6 million units in 2009, 7.2 million units in 2010, and 12 million units in 2011.
Apparently someone is even more wildly optimistic about the future of Kindles and ereaders than Amazon and me.
Filed under: evolution, kindle 2 | Tagged: kindle 2 cost to manufacture, kindle sales estimates
Labor costs? Product development costs? The fact that WhisperNet is free for life of product? While I won’t say their information is meaningless . . . what is their point? The retail is less than twice the “actual” costs which is saying something for retail. And, clearly people feel its worth it.
I do agree that labor and development costs need to be accounted for. However, whispernet costs ought to be, and probably are, included in the cost of books and content.
These tear down costs are fairly common, they do them with ipods, etc. They pretty much always do them with just materials, not including labor, sunk costs of R&D, distribution costs and other licensing costs like IP or whispernet.