July 11, 2012 at 4:55 PM ET
A teardown of Google's Nexus 7 — along with an analysis of its components and some guesswork — revealed that the $199 device contains about $152 worth of parts.
This estimate comes to us via the researchers at IHS, an organization that provides insight and analysis on all sorts of topics. These folks took an off-the-shelf Nexus 7— meaning that it's identical to one you could buy — and took it apart, piece by tiny little piece.
They calculated that an 8GB version of the device has a bill of materials (BOM) of $151.75 and that a 16GB version has a BOM of $159.25. Once manufacturing expenses are estimated and added, this puts the final costs for the two models at $159.25 and $166.75, respectively.
There are other expenses — such as software, licensing, royalties and so on — to consider, of course. So once it's all said and done, Google will likely break even on the 8GB model and make a "modest profit" on the 16GB version, the folks at IHS say.
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