It’s just been revealed that it costs Samsung $205 in parts to build one Samsung Galaxy Tab. “So why are we paying $500+!!?” As usual with any of these findings, it’s imperative to note – before you curse anything that has Samsung written on it – that other costs must be taken care of with the sale of a unit. An iPhone costs less than $200 to make but Apple sells it for 600, for instance. It’s necessary to pay for workers, research and development costs, factory maintenance, software development, marketing, distribution.
I could go on, but I won’t. Having said all of that, though, it’s at least comforting to know that it’s cheaper for Samsung to build this than it is compared to the iPad (16 GB version costing $264, compared to iSuppli.) Here’s what they attributed this to:
“Instead of matching up with the iPad on a feature-by-feature basis, the Galaxy Tab really is larger version of Samsung’s Galaxy S smart phone,” said Andrew Rassweiler, director, principal analyst and teardown services manager for iSuppli. “While the design approach makes the Galaxy less expensive to produce than the iPad 3G, it also makes for a product that lacks the same usability. The Galaxy Tab’s screen resolution, size and technology are not at the same level as the iPad. This is a critical difference, given the fact that the display is a key differentiating factor for the iPad.”
And why that’s comforting? I have no clue. iSuppli for the full breakdown.
Not to mention Ipad probably cost less than the estimate because Apple has a track record of selling out of their hardwares… so I ‘m assuming Apple and Samsung probably spent about the same amount
I’m actually surprised that it doesn’t cost more if it costs that much to make. It seems like things usually get marked up more than that.
This thing is not competitively priced at all…what is Samsung thinking?
There is a nice full review on the gadget at Engadget.com. Check it out there. I actually like it after the review. Though I still think the price is a little over the top, I would say if it came down to about 399 with no strings attached, it wouldnt be that bad. After all we pay upto 299 for our cellphones right?
“The Galaxy Tab’s screen resolution, size and technology are not at the same level as the iPad. This is a critical difference.”
How is 1024×600 not comparable to 1024×768? The Tab has a smaller screen, which means it has a better pixel density. The processor in the Ipad is built off the same processor in the Tab. The Tab also offers more customization than the iPad with it being built on Android, not to mention it has two cameras. Something the iPad lacks completely. Sounds like iSuppli are Apple fanboys…
There is a thing called supply and demand. We are paying over $500 for it because we will. There is very little correlation between the cost to manufacture a product and its retail value (except, in most cases, you don’t really want to sell it for less than it costs to make it, although that is not always true, either). Do you really think a Lexus that sells for $65,000 costs $40,000 more to manufacture than a Toyota that sells for $25,000?
Try this one, Archos 70 Internet Tablet, about the same specs but sold for $269: http://armdevices.net/2010/10/16/archos-70-internet-tablet-review/
@Landlord……..well put and I agree isuppli obviously is Apple fanboy. Look at there name…………lol. The real test will be Google optimizing Android for tablets.
This thing is way over priced , I wont even consider buying this thing !! besides there are so many more options coming out soon , even viewsonic just released pics of there upcoming tablets , much more competitivly priced
This makes me not want a Samsung TV, either.
You can get an Archos 70 tablet for less than half the price and do almost exactly the same thing, same size, and the Archos is on the 8th generation of comparable devices, so the build quality is great.
The price difference is usual for all products.
Administrators, it’s time to clean up some comments…
Kudos to Samsung for offering this great device!
Sorry but I don’t think Archos has any Android Market. Plus, they shot themselves in the foot by starting their tablet history with crappy tablets that only had Android 1.6. That’s why nobody really talks about them as an alternative right now. They pretty much sucked for quite a while.
The article quotes “The Galaxy Tab’s screen resolution, size and technology are not at the same level as the iPad.” OMG!! Have you tried to view a webpage on a iPad that has smaller text?…its totally fuzzy!! I played with the tab last week at a Sprint sponsored Tech reception, the display was beautiful! Its display has a higher pixel density than a iPad, seen it for myself.
That means with enough volume this that can probably retail for about $300 eventually. $500 on a parts cost of $200 sounds quite reasonable to me for a new product until they recoup their r&d and ramp up production.
Dude… It’s normal. Every commodity is sold above its manufacturing cost.
What this $205 doesn’t take into account is the probable MILLIONS spent on research and development + labour costs + tech cost + overheads + etc + etc + etc.
So don’t make a big deal outta it.
Dude, that just made you look so damn smart.
I agree with those who think trusting a blog called iSupply to give a good review to a device competing against an iDevice is really stupid.
I wish news blogs would stop even publishing these stupid “materials cost” articles. So there’s $205 worth of stuff making up the thing. Let’s not consider assembly, labor, shipping, storing, retail, R&D, and don’t even think about taxes. Yeah, Sammy’s probably making $300+ on every single one of these, sure. They must be evil. Gimme a break.
In some cases, manufacturers sell MORE by raising price as it makes people think the product is higher quality. I’m sure hefty discounts will be offered soon enough.
Anyone who is complaining should simply take their 205 dollars and go purchase all the necessary parts and assemble them, and voila, your very own 200 dollar Galaxy Tab.
Though the amount of applications on Android may make it a viable competitor to iPad, it would have to drastically reduce price to really garner some attention and bring people away from Apple. Nintendo won out in the console wars by pricing its console vastly lower than PS3 and Xbox360
Labor costs are typically 80% of the cost to build a product. If it’s $205 in materials, $500 is not bad.
Hey, if someone wants to order the raw parts and build one of these I’d get it from them. All I need is a one year warrenty and phone support. Any takers?
made ur own then, with $205… buy ur alone material, and home made… hahahahah