iPhone 4 Costs $188 to Make

With the iPhone 4 being the most popular Apple products in sales ever, people have begun to wonder exactly how much it costs to produce one.

Apparently not much.

The company iSuppli has estimated that the iPhone 4  costs $188 to make from start to finish.  Business Week first dropped the ball, showing the world just how much Apple’s making on these gadgets.  If you purchase a new two year phone plan with AT&T, the phone costs $199 (or $299 for the 32 GB model).  If you cancel your plan before two years is up, you pay another $300 on the phone and if you don’t pay for the plan at all the phone will cost you around $700.

The most expensive gadget to make on the phone is apparently the “Retina display” that Apple’s been raving about.  Any clue how much it is?  The part is supplied by LG Display for $28.50.  Surprised?  The ultra fast A4 processor, made by Samsung, only costs $10.75.

However, this estimate does not take into consideration costs for items such as labor, shipping, advertising, software development, or patent licensing and is only for the 16GB version of the iPhone 4.  Mobile Crunch also says that iSuppli has a tendency to low ball numbers “in an effort to convince manufacturers to contact them in order to connect with their preferred suppliers.”

Still, it’s pretty impressive how Apple can keep their costs low when creating what’s essentially the phone of the future.  I’d like to see the report that takes all factors into account and see just how low those costs are.