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GS3 vs. iPhone 5 Manufacturing Cost

R

rcsrich

Android Expert
So, just thought I'd post this in light of seeing plenty of references to the S3 being "cheap plastic" and how Samsung likes to cut corners on build quality to keep costs down.

According to IHS iSuppli, the cost (materials+labor) to build the iPhone 5 is $207 for the 16GB model. The cost to build the S3 (HSPA, 16GB) is $213.

iPhone breakdown: http://www.isuppli.com/Teardowns/News/Pages/iPhone5-Carries-$199-BOM-Virtual-Teardown-Reveals.aspx

GS3 breakdown: Samsung Galaxy S4 Carries $236 Bill of Materials, IHS iSuppli Virtual Teardown Reveals - IHS iSuppli

It was tough to find a single definitive retail cost for the phones, but it looks like in general, the iPhone costs between $50 to $100 more than the GS3.

Just because something is made out of plastic don't make it cheap, folks. :)
 
Haven't had the chance to check your links yet, but thanks for the info. And while those reports may be true, I think what people were more concerned with was the BODY of the phone. The chassis. Most people hate the thin plastic feel which seems cheap. While that's not necessarily the case, it just seems that way. While the overall production cost of the GS3 might be more than iPhone5, it doesn't mean they spend more money on the chassis. BUT, that could also be a positive. Perhaps Apple spends more money on the body and less on the guts? That could definitely be the case. Again, without looking at your links, I'm not sure if those reports break it down by body/guts. But I would think a consumer would be more concerned with the build of the guts than the chassis. Might not always be the case, but most level-headed consumers care more about the innards than the sturdiness of the body.
 
LookSir said:
Haven't had the chance to check your links yet, but thanks for the info. And while those reports may be true, I think what people were more concerned with was the BODY of the phone. The chassis. Most people hate the thin plastic feel which seems cheap. While that's not necessarily the case, it just seems that way. While the overall production cost of the GS3 might be more than iPhone5, it doesn't mean they spend more money on the chassis. BUT, that could also be a positive. Perhaps Apple spends more money on the body and less on the guts? That could definitely be the case. Again, without looking at your links, I'm not sure if those reports break it down by body/guts. But I would think a consumer would be more concerned with the build of the guts than the chassis. Might not always be the case, but most level-headed consumers care more about the innards than the sturdiness of the body.
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Point well made, & the reports only break the parts costs down so far, the iPhone 5 is a smaller phone, etc. I don't have an issue with reasoned discussions about plastic vs. metal, I just hate the immediate jumps to "it's plastic, and therefore cheap & crappy."
 
Absolutely. There are lots of cheaply made things in today's world. Most of them are found at Wal Mart. Or in automobiles. Or they get a 'cheap phone' and don't use a case and wonder why it broke when they dropped it. It's funny what people choose to b!tch about.
 
rcsrich said:
Point well made, & the reports only break the parts costs down so far, the iPhone 5 is a smaller phone, etc. I don't have an issue with reasoned discussions about plastic vs. metal, I just hate the immediate jumps to "it's plastic, and therefore cheap & crappy."
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I don't think anyone was claiming it was cheap. With the specs this phone has, it certainly isn't. However, it does feel like a toy to me. It is flimsy and slippery. I have dropped it numerous times because the plastic slides right out of my hand. There is something to be said for how it feels when you hold it.

There are ways to be made of plastic, yet not feel cheap. I would have preferred the qi compatible charging back to come with the phone. IMO, it adds a much needed weight to the S3. Not to mention, the back isn't as glossy. Or, a matte finish rather than the gloss would have helped.

Also, along your lines of pure device "cost," I would argue most of the price difference is in the screen.
 
I'm pretty sure one of the head honchos at Sammy is on record saying they use plastic because its cheap. ;)

With that being said... part of me really isnt surprised. My speculation...

a) Part of the cost of manufacturing is how many devices you run. Making more costs less. The last figures I'd seen show overall more Iphones being sold than S3's.

b) cheapest labor possible- I'll withhold further comment

c) For a company that manufactures or supplies parts for phones, landing apple would be a giant contract. As such, theres likely to be lots of demand to get that deal. Competition lowers prices
 
Id say the display is a huge part of the s3 cost. And a huge structural part of the phone. Thats where all the "stiffness" is coming from.
Must admit, id love my phone to be more of a thing of beauty (like the Xperia Z mmm. Or even the HTC One) but the display and the chips are what i go for.
I adore the AMOLED display, wish my tv looked so good :)

Id love to see how apple designers would make a phone with a decent sized display, removable battery, practical weight/strength for a reasonable price :thumbup:
 
funkylogik said:
Id say the display is a huge part of the s3 cost. And a huge structural part of the phone. Thats where all the "stiffness" is coming from.
Must admit, id love my phone to be more of a thing of beauty (like the Xperia Z mmm. Or even the HTC One) but the display and the chips are what i go for.
I adore the AMOLED display, wish my tv looked so good :)

Id love to see how apple designers would make a phone with a decent sized display, removable battery, practical weight/strength for a reasonable price :thumbup:
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The two reports I quote say $44 for the iPhone 5 display vs. $65 for the GS3 display- in the GS3 and the iPhone it is the single most expensive component, but still only $65 out of the total $205 cost of materials.

As far as the stiffness of the S3, the screen is only partly responsible- if you look carefully at teardown videos/pics, you can see that the screen, boards & some other internal components are attached to a metal (aluminum?) subframe I assume also acts as a heat sink for the processor, etc. The glass is rigid to some extent, but very thin and not particularly flexible because it is so hard- I think it would crack very easily if it was the sole thing adding rigidity to the phone.
 
Rxpert83 said:
I'm pretty sure one of the head honchos at Sammy is on record saying they use plastic because its cheap. ;)

With that being said... part of me really isnt surprised. My speculation...

a) Part of the cost of manufacturing is how many devices you run. Making more costs less. The last figures I'd seen show overall more Iphones being sold than S3's.

b) cheapest labor possible- I'll withhold further comment

c) For a company that manufactures or supplies parts for phones, landing apple would be a giant contract. As such, theres likely to be lots of demand to get that deal. Competition lowers prices
Click to expand...

True, there are economies of scale that come into play with manufacturing, but I can't imagine it is significantly cheaper to manufacture, say, 10 million phones than it is 20 million phones. As far as the labor, yes- it is mind-boggling that the estimated cost of labor is $8 for both phones, but remember that much of the production is automated, so maybe that isn't so surprising. Not quite sure what your point is in your last comment, but Samsung supplies some parts for the Iphone 5...
 
BTW, not really trying to make much of a point myself with these posts other than to discuss what I think is an interesting topic... :)
 
KOLIO said:
Guess who is paying for the production cost increase:

AT&T opens Galaxy S4 pre-orders on April 16th, priced at $250 on contract

I'm guessing the other carriers/retailers will follow suit,outside of the occasional sale here& there.
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Huh, T-Mo is going to offer them for $99 down on their new plan, then $20 a month for 24 months (or less if you get your tax refund & just want to pay for the thing).

But don't worry- I'm sure the price will drop just like with the S3- only a couple of months after their launch, most carriers had them for $159-$199...it hasn't even been a year since the S3 became available on major carriers (mid-June 2012 think) and now you can get them on contract for $49- stupid.
 
rcsrich said:
Huh, T-Mo is going to offer them for $99 down on their new plan, then $20 a month for 24 months (or less if you get your tax refund & just want to pay for the thing).
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Do the math. You're still paying full price for a phone. That's different from a subsidy.
 
ExtremeNerd said:
Do the math. You're still paying full price for a phone. That's different from a subsidy.
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Never said you weren't paying full price- of course you are. The difference with the new T-Mo plans (as I understand from all the press releases) is that after the phone is paid off (2 years if you do the $20 a month, shorter if you throw a lump of cash at it before that), you are only paying for the service, whereas with most other carriers, you keep paying the "inflated" rate that they charge to recoup the cost of the phone on into the future.

This article has a pretty good discussion & comparison of the new plan to other carriers' plans: Is T-Mobile's new no-contract plan really a good deal? | Mobile - CNET News

Of course, none of this changes the fact that T-Mo's network isn't necessarily the best...I found out the hard way that on crappy Virgin Mobile (Sprint) I could at least get 3G between DC and where I live in Richmond, but T-Mo is only 2G along most of this stretch. On I-95. One of the most heavily-traveled corridors in the country. Stupid.
 
If you look at tmobiles coverage map, they only cover large cities and major highways. Everything else (light green in their maps) is "service partner" aka roaming
 
Rxpert83 said:
If you look at tmobiles coverage map, they only cover large cities and major highways. Everything else (light green in their maps) is "service partner" aka roaming
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Yeah- about their coverage maps...filed a complaint with the feds because their maps tell two different stories depending on how you are zoomed in, but that's another issue. I-95 is a major road- in fact, they don't come any more major. I wouldn't even care if it was roaming as long as it was 3G. There's nothing like trying to check Maps to see why traffic is stopped up ahead only to wait 5 minutes for the traffic layer to refresh.

Don't get me wrong, I like T-Mobile for the most part & pay less than most people I know on Verizon, ATT & Sprint. I'm just saying I realize it's not a "Cadillac" carrier & there are viable reasons why people choose to pay more for other carriers.
 
rcsrich said:
Never said you weren't paying full price- of course you are. The difference with the new T-Mo plans (as I understand from all the press releases) is that after the phone is paid off (2 years if you do the $20 a month, shorter if you throw a lump of cash at it before that), you are only paying for the service, whereas with most other carriers, you keep paying the "inflated" rate that they charge to recoup the cost of the phone on into the future.

This article has a pretty good discussion & comparison of the new plan to other carriers' plans: Is T-Mobile's new no-contract plan really a good deal? | Mobile - CNET News

Of course, none of this changes the fact that T-Mo's network isn't necessarily the best...I found out the hard way that on crappy Virgin Mobile (Sprint) I could at least get 3G between DC and where I live in Richmond, but T-Mo is only 2G along most of this stretch. On I-95. One of the most heavily-traveled corridors in the country. Stupid.
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That's pretty standard. It is the same thing wrapped in a different package. How many people actually use a phone for more than two years? Most people are itching to upgrade ASAP, and do it as soon as they're eligible. T-Mo is simply providing you with a zero interest loan. Should you use the phone for more than two years, yes, you do save money. Odds of that happening aren't great and you will upgrade immediately again, repeating the cycle.
 
ExtremeNerd said:
That's pretty standard. It is the same thing wrapped in a different package. How many people actually use a phone for more than two years? Most people are itching to upgrade ASAP, and do it as soon as they're eligible. T-Mo is simply providing you with a zero interest loan. Should you use the phone for more than two years, yes, you do save money. Odds of that happening aren't great and you will upgrade immediately again, repeating the cycle.
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Really what they are doing is creating a bastard child from contract and prepaid plans- kind of like prepaid in that you pay for the phone separately and there is no mystery about how much of your monthly bill is going to pay for a phone vs. your service, but you have access to the newest & best phones rather than the second-tier phones you often see on prepaid plans. Just another way to skin the cat.

I think the second sentence in your first paragraph brings me full circle back to my original idea behind this thread- discussion of materials & phone cost.

Should we (Samsung, Apple, HTC, anybody) really be looking to buid phones for the ages out of metal, glass, epoxy, carbon fiber, space-age plastic or whatever if most of us will ditch them after 2 years, if even that long? Maybe the focus should be on making handsets that are easily recyclable. I mean, when manufacturers are coming out with model upgrades every year or less, what's the point?

Discuss. ;)
 
rcsrich said:
Really what they are doing is creating a bastard child from contract and prepaid plans- kind of like prepaid in that you pay for the phone separately and there is no mystery about how much of your monthly bill is going to pay for a phone vs. your service, but you have access to the newest & best phones rather than the second-tier phones you often see on prepaid plans. Just another way to skin the cat.

I think the second sentence in your first paragraph brings me full circle back to my original idea behind this thread- discussion of materials & phone cost.

Should we (Samsung, Apple, HTC, anybody) really be looking to buid phones for the ages out of metal, glass, epoxy, carbon fiber, space-age plastic or whatever if most of us will ditch them after 2 years, if even that long? Maybe the focus should be on making handsets that are easily recyclable. I mean, when manufacturers are coming out with model upgrades every year or less, what's the point?

Discuss. ;)
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I agree. They're going "prepaid," but keeping the same things we in contracts hate. This is why I prefer to buy my phones outright and pay $30 per month. Consumers save in the long run.

As to your second point, that's a WHOLE other issue haha. I'm not sure what happens, but there are currently phone recycling stations. You're not supposed to just throw a phone away. Maybe they're "recycled" to social service programs, such as the oft mentioned Obama Phone, or maybe they're legit recycled into new phones. I am not sure.

My personal feelings (not the sites) are not in favor of massive green programs. Most are just a marketing tool so consumers purchase more. Would HTC claiming the One is made out of 100% recycled material sell significantly more handsets? Doubtful. Would advertising it is made of 0% recycled materials prevent people from buying the GS4? Also unlikely.
 
ExtremeNerd said:
I agree. They're going "prepaid," but keeping the same things we in contracts hate. This is why I prefer to buy my phones outright and pay $30 per month. Consumers save in the long run.

As to your second point, that's a WHOLE other issue haha. I'm not sure what happens, but there are currently phone recycling stations. You're not supposed to just throw a phone away. Maybe they're "recycled" to social service programs, such as the oft mentioned Obama Phone, or maybe they're legit recycled into new phones. I am not sure.

My personal feelings (not the sites) are not in favor of massive green programs. Most are just a marketing tool so consumers purchase more. Would HTC claiming the One is made out of 100% recycled material sell significantly more handsets? Doubtful. Would advertising it is made of 0% recycled materials prevent people from buying the GS4? Also unlikely.
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I guess my rambling was less about the recycling & more about overbuilding phones considering their limited technological lifespans. BTW, I heard somewhere that most metal is a little radioactive now due to extensive recycling another reason for a plastic phone lol. :-D
 
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