iPhone is everybody’s dream-gadget (including me) – it’s cool, it’s great, it’s innovative, it’s all-in-one, it’s fantastic and it’s just gorgeous. But it’s abit pricey, compare with other smart-phone and it won’t be available till June-2007.
According to Silicon Valley market research firm iSuppli (BusinessWeek), the estimated cost for 4GB iPhone (retailed at $499) is $230 while 8GB iPhone (retailed at $599) is only $265 giving a profit margin of over 100% per unit. iSuppli specializes in tearing down popular electronic gadgets to figure out how much they cost to make.
The single most expensive part will be the 3.5-inch touch-sensitive display – costing $33.50. The costs of NAND-type flash memory chips supplied by Samsung will be in the region of $35 to $70.
Potential partners for iPhone:
Micron Technology Inc (NYSE: MU, stock) – to supply the CMOS imaging chip for the camera
Marvell Technology (Nasdaq: MRVL, stock) – to supply the Wi-Fi wireless networking chip
CSR Plc [formerly Cambridge Silicon Radio] (LON: CSR) – to supply the Bluetooth wireless chip
Samsung Corporation (SEO: 000830) – to supply the audio chip
Broadcom Corporation (Nasdaq: BRCM, stock) – to supply video clip
As component prices come down and to help stimulate demand, there’s good chance of Apple Inc (Nasdaq: AAPL, stock) in reducing the price over the time. With the wide gap of profit margin, it’s only logical for Apple to drop price in order to capture new customers who would like to buy iPhone but are existing owner of smart-phone from other brands.
Competitors such as Motorola (NYSE: MOT, stock), Nokia Corporation (NYSE: NOK, stock) and Sony Corporation (NYSE: SNE, stock) will definitely introduce new model with more functionality and features to narrow the gap with iPhone to both retain existing as well as capture new customers. Apple will have no choice but to bring price down to meet the 10 million unit sales target.
Another reason why you shouldn’t buy at this moment is the instability, limitations or bugs which are common in any first version of gadgets or softwares. With newer version, you’ll get more functions and features plus better system stability.
# TIP: If you can wait, end of 2007 should be a good time to get iPhone as the production will increase to cater for Europe and Asia market. With higher volume Apple can negotiate for a lower components’ price.
Potential partners for iPhone: 
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