Google charges hefty premium for 16GB Nexus 7 storage

Nexus 7 hardware cost breakdown shows that Google charges a $50 premium for $7.50 worth of extra storage.

Photo by: Josh Miller/CNET

Nexus 7 buyers who opt for the 16GB model are paying a premium for all that storage.

IHS iSuppli, a hardware research and market analysis firm, performed a cost breakdown of the components inside the Google Nexus 7.

According to their analysis, the entry-level Nexus 7 has a $151.75 bill of materials (BOM) and costs $7.50 to manufacture. The unit's IPS display and touchscreen are the Nexus 7's most expensive components at $38 and $24, respectively. Other big-ticket items include the Nvidia Tegra 3 processor at $21 and the battery at $12.75.

Then there's the memory. According to IHS iSuppli, the base-model Nexus 7's 1GB of RAM and 8GB of flash memory cost just $13.50. The top-end Nexus 7's 1GB of RAM and 16GB of flash memory cost $21. Therefore, the extra 8GB of storage is worth $7.50.

Given that buyers pay an additional $50 for the 16GB Nexus 7, Google earns a $42.50 premium on the additional storage.

Of course, Google isn't the only company to use extra storage capacity as a way to boost their bottom line. A similar analysis of the 2012 iPad revealed that Apple charges and even higher premium for its high-end tablets.


Bill Detwiler is Managing Editor of TechRepublic and Tech Pro Research and the host of Cracking Open, CNET and TechRepublic's popular online show. Prior to joining TechRepublic in 2000, Bill was an IT manager, database administrator, and desktop supp...

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