Kindle Fire teardown puts build cost at less than $3 above retail price
Amazon to make up loss with product sales through its $199 tablet
Computerworld - Teardown experts at IHS iSuppli found that it costs $201.70 to build Amazon's new Kindle Fire -- that's almost $3 more than the device's $199 retail price.
Many analysts expected Amazon to take a much larger loss on the Kindle Fire, if only to better compete against other tablets such as the iPad 2, which has a starting price of $499, or the Nook Tablet, which starts at $249. Amazon is expected to make up the loss through sales of products and apps to Kindle users.
According to iSuppli's tally the Kindle Fire's hardware costs $185.60 and the cost of manufacturing the device is $16.10.
The $201.70 figure is an actual teardown cost estimate that was derived from taking apart one of the Kindle Fire tablets, which were released Monday. That total is $7.83 less than the $209.63 virtual estimate that iSuppli made in September.
As is the case with most tablets, the display and touchscreen are the biggest costs in the latest estimate, adding up to a rounded total of $87. The memory, processor, wireless LAN radio and other peripherals cost $64.45, while the cost of the battery was put at $16.50. The case was $14.40 and the box contents were $3.25.
Andrew Rasseiler, senior director of teardown services at iSuppli, said Amazon isn't making money on hardware sales but on the paid content and other apps it is selling to users of the device.
ISuppli said the processor is a 1GHz Texas Instruments OMAP 4430 dual-core model that costs $14.65, which is 7.9% of the total. That processor is also used in the BlackBerry PlayBook tablet and the Motorola Droid Bionic and LG Optimus 3D smartphones.
ISuppli said its virtual estimate included the assumption that the Kindle Fire would have 8GB of DDR2 DRAM memory. However, the device actually ships with just 4GB of memory, supplied by Elpida. That difference shaved off a "few dollars" from the earlier estimate, the firm said.
Matt Hamblen covers mobile and wireless, smartphones and other handhelds, and wireless networking for Computerworld. Follow Matt on Twitter at
@matthamblen, or subscribe to
Matt's RSS feed. His email address is mhamblen@computerworld.com.
Read more about Mobile and Wireless in Computerworld's Mobile and Wireless Topic Center.


- Excel 2010 Cheat Sheet
- Register for this Computerworld Insider Cheat Sheet and gain access to hundreds of premium content articles, guides, product reviews and more.
- Mobile Middleware Strategies
- Learn why a mobile development platform is critical to be able to support today's complex enterprise mobility strategies. Learn what to look for...
- The Evolution of Enterprise Mobile App Development
- Driven by explosive growth in smartphone and tablet sales, enterprise mobility has become an essential part of business. Organizations across industries are developing...
- Native & HTML5 Mobile Apps: Not an either or, but a where and when
- Learn how developers are using HTML5 and native development methods to build mobile apps. Get practical insights on how these tools are being...
- Enabling Remote Employees with High Quality Video
- In this paper, we analyze the delivery of live and on-demand mobile video content. It focuses on specific ways in which organizations can...
- What to Look For in Solutions For Mobile Device Management
- Managing an increasingly mobile workforce has become one of the most challenging - and important - responsibilities for IT departments. This paper examines... All Mobile and Wireless White Papers
- The Office of Tomorrow with BlackBerry
- Curious about the office of the future and how to prepare with BlackBerry solutions? This session discusses the office needs of tomorrow and...
- The Changing Role of Tablets in the Enterprise
- Do you understand all the capabilities and potential of the BlackBerry PlayBook tablet? BlackBerry® PlayBook™ tablet can help enterprises do business differently.
This webcast... - Security Certifications 101 - BlackBerry and all those acronyms what do they mean and why they matter?
- FIPS, Common Criteria, CAPS, AISEP, NFC, NIST, Fraunhofer SIT, CESG, DSD - these are just some of the government and industry certifications which...
- PlayBook Video about two Grade 6 classrooms that are using PlayBook tablets
- RIM recently worked with Park Manor Public School in Elmira, ON to integrate BlackBerry PlayBook tablets in two Grade 6 classrooms. The project...
- McCain Canada deployed BlackBerry PlayBook tablets with a custom application to their salesforce
- McCain Foods Limited (McCain) has deployed BlackBerry® PlayBook™ tablets in order to enhance mobility within their sales force- along with a customized application... All Mobile and Wireless Webcasts
Prepaid service has started to transform from a source of cheap, bottom-of-the-barrel phones into a viable outlet for compelling smartphones. Read more...