Apple

Larger iPads put more money in Apple's pockets

2012 iPad hardware cost breakdown reveals that Apple charges a hefty premium for the 32GB and 64GB models.

iPad buyers who opt for the 32GB and 64GB models are paying a premium for all that space.

IHS iSuppli, a hardware research and market analysis firm, performed a cost breakdown of the components inside the 2012 iPad. According to their teardown, the 3rd generation iPad (Wi-Fi, 16GB) has a $306.05 bill of materials (BOM) and costs $10 to manufacture. Not surprisingly, the new iPad's Retina display is the most expensive component at $87. Other big-ticket items include the A5X SoC at $23, the Gorilla Glass touchscreen at $40, the iPad's 1GB of DRAM at $13.90, the cameras at $12.35, and the 43Whr Li-ion battery at $32.

Then there's the iPad's storage module. According to IHS iSuppli, the base-model iPad's 16GB of NAND Flash memory costs just $16.80. Each subsequent 16GB chunk of storage adds another $16.80 to the iPad's price tag. Therefore, the mid-level iPad's 32GB of storage costs $33.60 and the top-end model's 64GB costs $67.20.

Given that buyers pay an additional $100 for the 32GB iPad and $200 for the 64GB version, Apple makes a hefty profit on the 32GB and 64GB iPads' additional storage (see Table 1).

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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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