February 18, 2013

Blackberry Z10 Production Costs vs Pricing

blackberry Z10 BlackBerry Z10 costs about $154 per unit

As many of you are aware, Blackberry (formerly Research in Motion) recently launched their new flagship phone; the Z10. Unlike its predecessors, the Z10 is the first Blackberry phone to exclude their famous physical keyboard. This is also the first Blackberry to feature a design similar to ones that dominate the market today.

Focusing on competing with other competitors’ flagship phones such as the iPhone 5 or even the Galaxy S3, a surprising fact emerges. The Blackberry Z10 costs approximately $154 to manufacture, about a quarter of the price they are likely to charge when a consumer purchases it off-contract at $600.

According to CNN money, the 4.2 inch display costs around $26.50. The 1.5 GHz processor costs about $23.50 and both cameras combined total to $15. The 16GB internal storage only costs $9, which makes you think how companies justify the $100 increase for 32GB of storage. The battery, wireless chips and RAM cost about $21, while the remaining electronics are worth an approximate $59. The total leads to $154.

 In this industry, such a large markup isn’t surprising at all. The iPhone 4S is priced at about $183 when it was in production, with the iPhone 5 having a Bill of Materials (BoM) of about $207-238, depending on the storage capacity.

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