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Apple Lowered iPhone 5S Production Costs Says IHS

The Research Firm IHS who delights in tearing apart new devices, but not necessarily with the same aggressive fashion I wrote about earlier involving a Barrett Model 82A1 military rifle have spilled the beans on their findings and unofficially blabbed it to AllthingsD today. Basically the cost from the 5S compared to last years iPhone 5 fell about $6 bucks. They figure Apple has got about $191 dollars in components and another $8 dollars in production costs per device. This $199 dollar price falling from the $205 they calculated Apple had tied up in last years flagship device the iPhone 5. If you are wanting a 64gb version Apple slaps down another $19 dollars in component costs and with production costs equals $218 per unit. Yes Apple does back flips when you buy larger storage capacity devices!!!

The iPhone 5C component costs start at $173 per unit and paying for production is worth $7. So grand total for the iPhone 5C is about $180 dollars. So to play devil’s advocate to all the Nay Sayers who claim the Apple “sheep” are buying the same device as last year is that they are pretty much right according to IHS analyst Andrew Rassweiler:

“I would say that they’re almost the same phone, except that the 5s has the fingerprint sensor, the A7 processor and some newer memory chips that consume less power. Beyond that, they’re basically the same,” he said.

Yikes. The most expensive part in the device remains the retina display which costs the Cupertino gang about $41 dollars each. The full report will be released tomorrow for the breakdown in component costs if any one is truly interested but suffice to say Apple will continue to make money again this year. Some of it coming from me of course.