updated 08:10 am EDT, Thu May 13, 2010
Apple may boost price back up on 2010 iPhone
Apple is likely to bring the cost of materials back up to where it was a year ago when it releases the next iPhone, according to an early estimate. While making a 16GB iPhone 3GS has dropped to about $156, the new model is expected by UBM TechInsights to go back up to between $169 to $175, or about as much as the previous phone did when new. The phone's biggest price hike would come from a higher resolution screen that could cost $25, or $9 more than it does now.
The analysts believe that the screen would still be 3.5 inches but would move up to 720x480. An upgrade of the sort would maintain the same aspect ratio as the 480x320 screen today, but another has suggested a 960x640 display that would be an industry first. Some sources for the researchers support notions the phone might be called iPhone HD due to support for 720p video playback, even if the resolution won't be high enough to play the video at full detail.
Other factors would also contribute to the cost, but in less conspicuous forms. The custom-designed A4 would cost $16, or $3 more than the 600MHz Samsung ARM Cortex-A8 chip used in the iPhone 3GS. A 5-megapixel camera and the front camera could add a total of $6, and the combination of aluminum as well as a possible toughened ceramic back could boost the cost of the enclosure to $20.
Much of the final cost could depend on flash memory pricing, which could create an unusually wide gap in the capacities Apple can sell. While a 16GB version of the new iPhone has already been spotted and would likely cost about as much to make as the 3GS did, drops in the cost of flash memory production could leave a 64GB model costing just $250. Apple charges carriers significantly more but usually subsidizes the price to just somewhat higher than the raw manufacturing cost.
The GSM version of the phone is commonly thought to be shipping in June. A update on contracting rumors, however, has Pegatron manufacturing a new CDMA version sometime in August or September, as Apple would only start paying for assembly of the new handsets at the same time. The clarification is consistent with talk of a Verizon iPhone built in the fall.
Apple's expectations may be cautious, as part producers reportedly understand that the company will make about 10 million CDMA iPhones in a year. AT&T currently activates more per quarter, suggesting that the estimate if real doesn't expect many customers to defect from AT&T. It also wouldn't be a large enough volume for Apple to be selling the CDMA edition outside of the US, as sales at other significant CDMA carriers like China Telecom or KDDI could easily demand more units.