Sign in with
Sign up | Sign in
Your question
Closed

Why Apple Can Produce Tablets for Less Money

Tags:
  • iPad
  • Tablets
  • Apple
Last response: in News comments
Share
Anonymous
August 2, 2011 9:00:03 PM

IHS released a report that describes some of the reasons why Apple has critical advantages in designing the iPad and why it may be able to keep those advantages in the foreseeable time.

Why Apple Can Produce Tablets for Less Money : Read more

More about : apple produce tablets money

August 2, 2011 9:22:53 PM

Doesn't surprise me! There's no way around it, but Apple has learned to maximize the use of its hardware for the software they employ. Sure the software could incorporate some features that Android has had for a while, but Android has all these powerful phones and tablets and there are distinct performance flaws regardless of the Hardware specs that trump Apple's offerings.
Score
10
August 2, 2011 9:27:06 PM

Not a big fan of iPads (or tablets in general for that matter), but you have to admit that Apple is being very smart about this approach in mobile platforms.

It costs them less money to manufacture the equipment, but yet they sell it for the same price (or more) as the competitors. Genius. Sure the specs of their products may be less than the specs of a competitor's, but if it performs just as well, who cares?
Score
11
August 2, 2011 9:30:16 PM

Not a single mention of Foxconn? They're replacing their employees with robots soon, because robots haven't yet learned how to commit suicide.
Score
21
August 2, 2011 9:34:13 PM

We are starting to see more Android tablets that are beating the iPad on price now. Acer and Asus come to mind.
Score
11
August 2, 2011 9:45:50 PM

assmarNot a single mention of Foxconn? They're replacing their employees with robots soon, because robots haven't yet learned how to commit suicide.

Have you even checked the suicide rates of cities the size of the Foxconn factory? I believe there are ~800,000 people working there, which is bigger than the city I live in, and I'm sure there are more suicides here than the ones there. People have real life problems; it might not have anything to do with Foxconn... They did handle the situation poorly though.

Back to tablets: Has anyone compared Apple's ipad 2 to the competition? The chip has the same 1ghz processor as the Galaxy Tab 10.1(uses Tegra 2), but is 2-3 times more powerful in the graphics department. The Galaxy Tab does have 1GB of memory though, which can be useful. But the ipad 2 also has a longer lasting battery, this is really nice for long trips away from a plug. You can check it out.
http://www.anandtech.com/show/4445/samsung-galaxy-tab-1...
Score
1
August 2, 2011 10:08:04 PM

Acer and ASUS are the only ones... there are others selling tables for $250 or so, but they are easily cheap garbage with low quality displays, very limited memory.

Like in the old days, there are disadvantages and advantages in typing the software to the hardware. An example, a 1986 Amiga 1000 with 7Mhz CPU and 1MB of memory running AOS2 in 1990, was easily FASTER than a 386 @ 25mhz with 2~4mb of RAM running Windows 3. Why? The OS and software can talk directly to its hardware.

Bad thing: It means add-ons and some customizations were more challenging.

So when it comes to the MS-PC world, it always HAS BEEN BRUTE force to get the performance. It always was and always will be this way. So yeah, my iPad1 still feels faster and more responsive in many ways over a TouchPad and Androids with dual core CPUs.

Apple will continue to make a good profit with its iOS products in ways the Android and others can't (at least for now)... and I'll admit I'm open to going Android for a tablet. WebOS on the HP TouchPad... is very good, there are some areas of weakness as well as the HP brand itself.

People and business refer to these devices are iPads and tablets. Like Coke and other soda... that's good marketing and how it is.

Apple has the hardware and software, but it has direct control over:
- App store
- iTunes for music and movies
- eBooks

Its a different business model than Android and the hardware companies. Asus, Acer, Lenovo, Dell, etc makes money off the sale of the hardware ($30~50 per unit). and that *IS IT*... they are done.

Google makes money off the ads and some off the apps... that's it. That is their business. Not music.

Meanwhile, Apple makes money off the hardware, the apps, the music and the videos. So you can bet, they want to be on top of everything.

I wish Apple will stop the law-suit crap... it makes me NOT want to get an iPad3, but I also don't was a 16:9 tablet.
Score
0
August 2, 2011 10:43:13 PM

assmarNot a single mention of Foxconn? They're replacing their employees with robots soon, because robots haven't yet learned how to commit suicide.


Which should result in a huge layoff and then MASS SUICIDES.
Automation is great but there is always a loss of jobs that goes with it.


Score
2
August 2, 2011 10:53:43 PM

Apple can produce them for less but will they SELL them for less?
We know the answer to that one, already...
Score
12
August 2, 2011 11:11:33 PM

Why Apple Can Produce Tablets for Less Money:

More 'slave' labor
Score
6
August 2, 2011 11:11:37 PM

CLEARLY Apple passes the savings to you!


Oh wait.
Score
19
August 2, 2011 11:21:42 PM

They are greedy and will not sell for LESS. Just by another companies tablet and get more hardware for less cash..
Score
9
August 2, 2011 11:34:29 PM

Just because Apple can make something for cheaper than anyone else can, is not a good reason for it to also offer the product for less.. From a Business perspective, that is.

But the article makes sense.. Apple has alot of power, and it can obviously use that to it's advantage.. Also why Apple products tend to just have that smooth "Apple Experience" product owners and fans like so much.
Score
-1
August 3, 2011 12:18:11 AM

scuba daveJust because Apple can make something for cheaper than anyone else can, is not a good reason for it to also offer the product for less.. From a Business perspective, that is.But the article makes sense.. Apple has alot of power, and it can obviously use that to it's advantage.. Also why Apple products tend to just have that smooth "Apple Experience" product owners and fans like so much.

Can I ask something?


I would like to know how far, is too far? How far down the greed hole does Apple need to go before it's just too much for you?


When is enough, enough?

$1,000 markups? $2,000 markups? Taking a second mortgage out on your house to buy an iMac?
Score
6
August 3, 2011 12:41:30 AM

Meh, I was expecting something a bit more informative. A bit common sense and some invalid arguments. I'm sure Android tablets could run at 512MB ram but there's competition so if you have 512 when others have 1024 then people won't pick your target.
Score
1
August 3, 2011 1:32:10 AM

This article ignores that the R&D for Apple is also going to be higher if Apple has to do it by themselves, whereas the rest get it spread out among other companies as well.

Fact is, Apple has almost always done it this way, with their PCs combining software and hardware, although certainly not to the same extent (they always bought processors from someone else, for example), but Apple products have ALWAYS been extremely expensive for what they were. They still are.

Obviously numbers will lower the price per unit in terms of R & D, but their R & D costs have to be pretty high compared to other makers right now, and I don't think it makes it a lot cheaper factoring that in. Also, comparing a unit with half the memory isn't really a strong statement for their advantage. Hell, anyone can sell something with reduced functionality for less. That's not really a plus.
Score
0
Anonymous
August 3, 2011 1:34:27 AM

Apple should purchase AMD, in order to create a similar situation in the laptop and desktop sectors too.
Score
-1
August 3, 2011 1:39:00 AM

This is really nothing new. For years Apple "could" have pushed put desktops and laptops that were more competitively priced. They just choose to slap an Apple tax on it, vamp up the sales price and proclaim it magical and the fanatics leap for it.

That Apple clone company showed that OSX ran just fine on "cheaper" alternative builds. They utilize the same parts most PCs do. They just want you to think there is something special back behind that mirror.

As for iDevices there are a couple things this article missed.
1) Apple is currently the only company on the market that makes money on the back-end. Most of their revenue comes not from device sales but through the App Sote, iTunes ect. They could give away their iDevices and still make more than most Droid company's do.

2) A lot of the parts across the board are the same. They don't change up from build to build. So when Apple locked in long term component contracts they got a better deal. They aren't buy something "magical" others can't. They just know how to lock down the competition by locking up the resources.
Score
0
August 3, 2011 1:53:03 AM

A bad thing... going full circle back to days of hardware being tied to software, a cycle that MS first broke and undoubtably made things better for us all of us with more choice, more options. I don't think an Apple dominated world of personal computing is going to be good for consumers in the end.
Score
3
August 3, 2011 2:36:35 AM

Maximus_DeltaA bad thing... going full circle back to days of hardware being tied to software, a cycle that MS first broke and undoubtably made things better for us all of us with more choice, more options. I don't think an Apple dominated world of personal computing is going to be good for consumers in the end.

But you don't understand - These people seriously want to blow Steve Jobs. They have no shame. They will buy anything he gives them.
Score
5
August 3, 2011 2:47:34 AM

I find it quite ironic that despite the persistent criticism of a top-down/vertical integration system, a company always seems to come back to it.
Score
1
August 3, 2011 2:51:29 AM

Smart business, they can make it work this time due to the sheer volume of demand, which they could never capitalize on in the same way with Macs.
Score
0
August 3, 2011 3:23:16 AM

One critical strength of Apple is that the decision maker of the company is also a developer and more importantly a user of its own products.

Whereas for the competitors, their top management seems to be some fuddy-duddy who might not have even installed an app on phones produced by themselves.

The resultants:
Nokia N8 - still not as user-friendly as iPhone 1st gen.
LG Optimus 2X - almost all its user complain about its botched software.
Samsung Galaxy - What can be said? They deploy a battle group smartphones to besiege iPhone4.
Motorola - it rejuvenates itself, so it a winner here. but it's no treat to apple at all.
SE - something as Motorola.
HTC - with its limited financial strength, it has done a pretty good job as a pioneer in the smartphone market. but we don't see a very bright future of it under the besiege of Samsung and numerous Android device provider.
Score
0
August 3, 2011 3:34:48 AM

I see lots of talk of hardware, software and price point, but what apple really sells is a belief and they sell that belief so well, they have fanatics... almost sounds like a religion.
Score
1
Anonymous
August 3, 2011 4:48:30 AM

of course they could just slash that 40% profit margin, but then again, if you are going to rob some morons, might as well rob them for every cent you get, lest they get a clue about the crap they buy.
Score
3
Anonymous
August 3, 2011 5:43:31 AM

Apple does not make most of its profits on the add on services. The integration of software and hardware is where the extra value comes from. Only one company is responsible for the whole product. No falling between the cracks of its a hardware issue, no its a software bug, It doesn't work? We will replace it or give you your money back. I just returned an iPad 2 after 25 days of trying it out. It worked fine but I didn't need it. I will get an iPad 3 after it comes out and keep it. I love the way people always talk about how capitalism works and yet when a product becomes popular its just marketing and stupid people. There couldn't be any reason except stupidity that someone wants a product that works.
Score
0
August 3, 2011 7:24:37 AM

Awesome! They can produce their products for less, charge the masses more for them, make even more profit, and in-turn make more awful products for the sheeple.
Score
3
August 3, 2011 8:58:54 AM

To me, the iPad is not a very interesting tablet (I own one, I can judge): no connectivity, no SD slot, no personalization and soo many limitations compared to android based systems,... but those limitations have a good side: the system is simple, uses few resources and battery life is better than average.
I don't buy all those negative comments regarding the pricing, Foxconn and all the rest:
- Any well managed company HAS to sell a a price close to the maximum that enough customers accept to pay. Given the volumes of iPad Apple manages to sell without having to discount it, I'd say they were quite correct in their assumptions when they defined their pricing.
- I would not like to work in a big factory, but Foxconn has so many workers that from a statistical point of view, suicide rate inside their company is probably much lower than on average outside the company. (I can imagine that there are more persons out there committing suicide or becoming junkies because they don't find a job or have no money?).
Score
1
August 3, 2011 9:23:02 AM

HaserathBack to tablets: Has anyone compared Apple's ipad 2 to the competition? The chip has the same 1ghz processor as the Galaxy Tab 10.1(uses Tegra 2), but is 2-3 times more powerful in the graphics department.

Did you just say that the iPad and Tab 10.1 share the same processor?
Score
0
August 3, 2011 12:31:35 PM

Apple's fanboys are not ill-deserved. Have you seen the new MacBook Air? That thing is sweet! For years Apple has been leveraging it's design savvy to entice users, but they have also delivered in quality and usability, and price. I used to think Apple was more expensive, and then I started selling my old Apple Hardware on craigslist and the resale value made up the difference with a comparable PC. Factor in the need for less software,and hours saved, you came out ahead. It's a total-cost-of-ownership thing that PC fanboys just don't understand. I was skeptical too until I made the switch, now I'm a true believer.
Score
-1
August 3, 2011 1:09:31 PM

To make fun of FOXCONN with dealing with Apple is silly.... Since they make computers for the likes of Lenovo (ThinkPads), HP, Dell, etc, etc.
Score
-1
August 3, 2011 1:39:29 PM

Having complete control over the OS is a bad idea. They could pass that $14 to the consumers. Instead of $399 or $499 or whatever they sell for in the US, they could be $413 and $513. Except, I think it's called a "psychological price" (399 sounds better than 400). Hmmm... Then maybe they could slash some of that 40% profit margin the cosumer's way, eh ? Kinda like a free $14 gift card. But no... This is Apple we're talking about here.

I own an iPod touch 2G and because Apple decided it's old (Pff yeah, 2 years old...) and doesn't have enough RAM for multitasking and such, they cut support for it. It can't go further than 4.2.1. Same happened with 1st gen, but I can understand why (it was a first generation product, the first of its kind and there had to be some kind of flaws, there always are - like the home button getting stuck inside the case, power button caving in, audio jack problems, etc).

Hmph. Mark my words current iPad owners, the day will come when they decide to stop supporting it and that you *should* get another one. All for a stupid $14... Then you'll remember this article and how $14 from their profit margin could've added a few extra years of life to the thing. Mark my words.
Score
1
August 3, 2011 1:43:43 PM

But anyway, getting back to why having complete control over the OS is a bad idea, think of Linux (and Android, respectively). If your decade-old computer can't handle Windows 7 "Aero" effects, I'm almost positive it will handle Compiz-Fusion. I know. I tried it last year or so on Geforce 4 MX 440 (64 MB), 512 MB SDRAM and an old Athlon XP 2200+ CPU (1.8 GHz).

The point is you could add a lightweight interface, fewer processes, etc. But not when only one vendor handles the OS exclusively.

Sorry for the double post.
Score
0
August 3, 2011 2:45:45 PM

lol had this been a really long article i would have thought Wolfgang's written it. Already has a pro apple title.

BUT: Since it's a short to-the-point article from a neutral author, it does help shed light on industry trends.
Score
0
August 3, 2011 3:26:30 PM

HaserathHave you even checked the suicide rates of cities the size of the Foxconn factory? I believe there are ~800,000 people working there, which is bigger than the city I live in, and I'm sure there are more suicides here than the ones there. People have real life problems; it might not have anything to do with Foxconn... They did handle the situation poorly though.Back to tablets: Has anyone compared Apple's ipad 2 to the competition? The chip has the same 1ghz processor as the Galaxy Tab 10.1(uses Tegra 2), but is 2-3 times more powerful in the graphics department. The Galaxy Tab does have 1GB of memory though, which can be useful. But the ipad 2 also has a longer lasting battery, this is really nice for long trips away from a plug. You can check it out.http://www.anandtech.com/show/4445 [...] 1-review/7

I second that, the whole suicide myth has been thoroughly debunked many times over and only gets regurgitated by the tin-foil hat brigade when they want a good trolling session.

Pick any demographic you like, age range, sex, geography, anything - the suicide rate is less than the rest of China and indeed the USA.
Score
-1
Anonymous
August 3, 2011 3:43:12 PM

You have a misunderstanding of the Apple consumer. Apple consumers pay for value. They don't look for cost savings. If they did, they would buy a generic, cheap PC. There's no greed here. It's value. And in exchange for that value the customer pays what he believes is fair. Otherwise they wouldn't pay for the product at all. You rarely hear of an Apple consumer complain about price...lol
Score
-1
August 3, 2011 5:08:31 PM

Quote:
Why Apple Can Produce Tablets for Less Money


Slave labor.

/thread
Score
2
August 3, 2011 5:58:12 PM

Apple's products are alright. It's just the company's business model I can't stand.
Score
0
August 3, 2011 6:12:57 PM

assmarNot a single mention of Foxconn? They're replacing their employees with robots soon, because robots haven't yet learned how to commit suicide.

At Foxconn even the robots commit suicide but they just get re-assembled :) .
Score
2
August 3, 2011 7:46:08 PM

johntwanYou rarely hear of an Apple consumer complain about price...lol

I own an Apple product (an iPod touch) and I think their whole line of products are over priced for what they do. Take, for instance, their headphones. They're complete crap. I would not buy them EVER. Why? Because there are much much better alternatives (like the Sennheiser street line) that offer much better value. I own an old pair of Sennheiser CX300, 2007 model, that sound comparatively better than the crap that came with the iPod. In fact, the grey rubber band on the Apple headphones decomposed to the point that they look like Swiss cheese. They're that bad. And more expensive than the Sennheisers! This is their build quality, but the audio quality is also very weak. No respectable music critic or audiophile would use such headphones. Too bad they came bundled... I would've rather have bought a cheaper iPod than use those.

Never again!
Score
2
August 3, 2011 8:30:27 PM

belardoTo make fun of FOXCONN with dealing with Apple is silly.... Since they make computers for the likes of Lenovo (ThinkPads), HP, Dell, etc, etc.


EXCEPT....EXCEPT.....Apple sells their products at a price that should exist ONLY if they were built in the USA by well paid workers, not slave labor!
Score
1
Anonymous
August 4, 2011 10:06:51 PM

The idea that you raise the unit production costs by $14 by bumping memory from 512 MB to 1 GB bothers me. Wikipedia says the iPad 2 uses DDR2 1066. Newegg currently doesn't have any laptop-sized sticks above 800 in stock, but a 512 MB stick of DDR2 667 is the same price ($13-14) as a 1 GB stick of DDR2 800. DDR2 is a mature technology, and the total memory has little effect on the cost per stick - I could accept that a normal laptop stick might not fit, so some consideration for a custom form factor is needed, but the price of each chip going into that form is almost nonexistent - retail prices vary according to production costs and the cost of doubling the number of chips is almost a rounding error.

Furthermore - maybe not at the time the iPad 2 was in development, but this is definitely the case today - a 1GB stick of DDR3 1333 (which uses smaller, more power efficient chips) for a laptop costs as little as $9 and 2GB costs $13, matching the cost of that 512MB DDR2 stick above.

I can accept there being reasons to go with the configuration they ultimately went with other than raising profit margins and keeping the specs low so they can spring forward if ever threatened (which are my default assumptions about Apple's specs), but I plainly cannot accept that it would cost Apple $14 to bump an iPad 2 up to a full GB of RAM when $14 is on par with the retail price of RAM in the first place and the retail price of either size is the same.
Score
0
August 7, 2011 4:47:33 AM

ancsik:

DIMM memory used in desktop and notebook computers are not the same a those on a tablet or iPad device. And when it comes to building devices, each screw, each SMT, each trace costs money. If it takes one memory chip vs two memory chips, it means a savings of money and space and heat.

They sold 20 million iPads... x $15~30 in savings, is a lot of extra profit.
Score
0
August 7, 2011 4:49:45 AM

legacy7955EXCEPT....EXCEPT.....Apple sells their products at a price that should exist ONLY if they were built in the USA by well paid workers, not slave labor!


Oh I agree with you. Back in the OLD days, Apple II and commodore 64s were built in the USA. But this is capitalism at its best. As a stock holder, you want to get the most for the least amount of money for highest profits.

Contact your congressman... tell them to remove tax-breaks for companies who move our jobs overseas. Did you know there was a bill on the floor to do this? Guess who killed it?
Score
0
August 7, 2011 4:52:24 AM

About the jobs bill see "H.R. 4213, P.L. 111-205"

hey, even in China... humans costs too much, FOXCONN will be dumping tens of thousands of humans for robots.
Score
0
!