y based on a “preliminary virtual teardown”. An actual, detailed teardown of the new iPhone’s components and cost structure is scheduled to be performed after the iPhone’s release on July 11. “At a hardware BOM and manufacturing cost of $173, the new iPhone is significantly less expensive to produce than the first-generation product, despite major improvements in the product’s functionality and unique usability, due to the addition of 3G communications,” said Dr. Jagdish Rebello, director and principal analyst for iSuppli. “The original 8Gbyte iPhone carried a cost of $226 after component price reductions, giving the new product a 23 percent hardware cost reduction due to component price declines.”
iSupply has posted all the hardware costs related to the 8GB iPhone. However, the report doesn’t include other costs, such as software development, shipping and distribution, packaging, and miscellaneous accessories included with each phone.