Interesting, the cost breakdown to make an iPhone:

http://tinyurl.com/28v49e8

Somewhere else (I lost it now) they mention assembly costs are around $9.50.

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On 14/10/2010 12:02 PM, scott wrote:
> Interesting, the cost breakdown to make an iPhone:

Interesting indeed.

I note that with all the sophisticated technology in this device, the 
single most expensive component is... the display?! (And that's not even 
including the touch feature, just the actual display itself.) Closely 
followed by... the flash RAM?? Everything else is peanuts compared to 
these two items.

I'm quite surprised at how cheap some of the items are. You would have 
thought the processor would be expensive... but no. (The RAM is more 
expensive than the CPU?!) You would have thought the 5 megapixel camera 
would be expensive... but no. You would have thought the custom battery 
would be expensive... but yet again, no.

I'm also surprised at just how cheap the casing is; you would have 
thought making something that can survive being sat on, dropped on the 
pavement, rained on or flushed down a toilet would be very expensive. 
But apparently not.

(Strictly, they list the cost of the materials, not the cost of actually 
assembling them.)

I also note with some amusement that it has a 960x640 pixel screen. 
That's slightly higher than the Amiga 1200 "Super-Hires Interlaced" 
video mode, at 960x480 visible pixels. (Well what did you expect with < 

that includes the backlight...)

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> I note that with all the sophisticated technology in this device, the 
> single most expensive component is... the display?!

It's a nice display though :-)

> I'm also surprised at just how cheap the casing is; you would have thought 
> making something that can survive being sat on, dropped on the pavement, 
> rained on or flushed down a toilet would be very expensive. But apparently 
> not.

Those parts are typically quite cheap to produce in high volume, once you 
have the tooling done it's just injecting cheap plastic into a mould or 
cutting and folding sheets of cheap metal.

> (Strictly, they list the cost of the materials, not the cost of actually 
> assembling them.)

The list is the amount you pay to buy those components (which includes the 
sub-assembly needed for those individual components), on top of that price 
there is about another $10 to assemble that lot together into an iPhone.

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>> I note that with all the sophisticated technology in this device, the
>> single most expensive component is... the display?!
>
> It's a nice display though :-)

I saw an iPhone in real life for the very first time on Saturday. It is 
actually a nice display. If you can see through all the fingerprints. ;-)

>> I'm also surprised at just how cheap the casing is; you would have
>> thought making something that can survive being sat on, dropped on the
>> pavement, rained on or flushed down a toilet would be very expensive.
>> But apparently not.
>
> Those parts are typically quite cheap to produce in high volume, once
> you have the tooling done it's just injecting cheap plastic into a mould
> or cutting and folding sheets of cheap metal.

If metal and plastic are "cheap", then why does everything get made out 
of the most skimpy amounts of material the manufacturers can get away 
with so that it's only just barely strong enough to not break?

>> (Strictly, they list the cost of the materials, not the cost of
>> actually assembling them.)
>
> The list is the amount you pay to buy those components (which includes
> the sub-assembly needed for those individual components), on top of that
> price there is about another $10 to assemble that lot together into an
> iPhone.

Now, see, I would have thought just surface-mounting the 2,157 
individual resistors would cost more than $10... But what do I know 
about anything?

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> If metal and plastic are "cheap", then why does everything get made out of 
> the most skimpy amounts of material the manufacturers can get away with so 
> that it's only just barely strong enough to not break?

Why waste money making it stronger and thicker than it reasonably needs to 
be?  Even just 5 or 10 cents extra spent on each iPhone would equal quite a 
big amount of money overall.

> Now, see, I would have thought just surface-mounting the 2,157 individual 
> resistors would cost more than $10... But what do I know about anything?

I suspect the cost of mounting the resistors can be worked out by the 
depreciation of the SMD mounting machines over the lifetime of the product, 
plus the cost of running the machine.  It's surely not very much though, 
given that you can buy loads of consumer devices with populated PCBs inside 
them for well under $10.

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>> If metal and plastic are "cheap", then why does everything get made
>> out of the most skimpy amounts of material the manufacturers can get
>> away with so that it's only just barely strong enough to not break?
>
> Why waste money making it stronger and thicker than it reasonably needs
> to be? Even just 5 or 10 cents extra spent on each iPhone would equal
> quite a big amount of money overall.

Making something stronger than it needs to be would indeed be a waste of 
money. But it seems that these days, everything is made *weaker* than it 
actually should be.

Then again, maybe that's because I'm still thinking like a consumer. 
When I buy something, I want it to *not* brake. The manufacturer, on the 
other hand, has a vested interest in making it so flimsy that it won't 
last 5 minutes. That way they get more repeat business. (In addition to 
the materials savings, obviously.)

Personally it makes me angry that somebody would deliberately design 
something to be defective so that they can make more money out of me. 
But I guess we can put that down to market forces. There will always be 
people who make expensive high-quality goods, and other people who make 
cheap low-quality goods. What kinds of product you find in the shops 
depends on what people buy the most of. And today's mentality seems to 
be "buy the cheapest thing on the shelf, no matter how defective it is".

>> Now, see, I would have thought just surface-mounting the 2,157
>> individual resistors would cost more than $10... But what do I know
>> about anything?
>
> I suspect the cost of mounting the resistors can be worked out by the
> depreciation of the SMD mounting machines over the lifetime of the
> product, plus the cost of running the machine.

How about the cost of the resistors themselves?

Oh, mind you, that's already in the BoM...

> It's surely not very much
> though, given that you can buy loads of consumer devices with populated
> PCBs inside them for well under $10.

True. I have a 4GB flash RAM device in my pocket that cost 99p.

(I still don't understand why digital devices *need* thousands of 
analogue components in them in the first place, but anyway...)

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> Then again, maybe that's because I'm still thinking like a consumer. When 
> I buy something, I want it to *not* brake. The manufacturer, on the other 
> hand, has a vested interest in making it so flimsy that it won't last 5 
> minutes. That way they get more repeat business. (In addition to the 
> materials savings, obviously.)

I think more people would steer away from a brand if it got a reputation for 
breaking all the time, usually manufacturers have exact targets for how many 
devices are returned failed after certain amounts of time.  They are 
carefully calculated (to produce a device that doesn't break too often, but 
is also sensible to manufacture) and then the product is carefully designed 
and tested to meet these targets.  The bad reputations usually come from 
mistakes rather than deliberate design intention.  Still this is usually a 
result of poor design/testing procedures, which are obviously related to 
cost.

> Personally it makes me angry that somebody would deliberately design 
> something to be defective so that they can make more money out of me.

I doubt anyone designs something intentionally to fail, no matter what it 
might seem like as a consumer.  It's quite hard to design something to be 
fine within warranty but then to fail just after, you risk a huge 
replacement bill if you try that tactic, plus you'll get a very bad 
reputation.

> (I still don't understand why digital devices *need* thousands of analogue 
> components in them in the first place, but anyway...)

On our boards nearly all of the discrete components are part of the power 
supply or to round off the data signals to improve EMI/EMC performance.

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scott wrote:
> Interesting, the cost breakdown to make an iPhone:
> 
> http://tinyurl.com/28v49e8
> 
> Somewhere else (I lost it now) they mention assembly costs are around 
> $9.50.

Tht's not the cost of making an iPhone. That's the cost of the hardware that 
goes into making an iPhone. It leaves out stuff like patent licenses, and of 
course the sunk design costs etc.

-- 
Darren New, San Diego CA, USA (PST)
   Serving Suggestion:
     "Don't serve this any more. It's awful."

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On 10/14/2010 7:53 AM, Invisible wrote:

> Now, see, I would have thought just surface-mounting the 2,157
> individual resistors would cost more than $10... But what do I know
> about anything?

Well... once you buy the machine to do it, it doesn't really use too 
much electricity (except, maybe the heater to keep the solder bath warm, 
and only takes a few minutes to pick and place the components. But the 
initial outlay for the cost of the machine is a high cost.

-- 
~Mike

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On 10/14/2010 9:46 AM, scott wrote:

> On our boards nearly all of the discrete components are part of the
> power supply or to round off the data signals to improve EMI/EMC
> performance.

[A large chunk of this response is mostly directed at invisible]

Right. Filtering the signals. Caps are used a lot of time in digital 
circuits to prevent switching noise from corrupting signals via ground. 
When some digital circuits (TTL in particular) switch they create a lot 
of noise on the ground plane that must be dealt with. Too much 
fluctuation between power and ground, and the circuit begins to behave 
erratically. Also, its a good idea to limit current. Resistors are used 
to stabilize signals, pull up or pull down an input or output, bleed off 
excess voltage so FETs don't retain a charge, etc... You need RC 
networks to run a clock crystal, etc... Just connecting together a pile 
of digital components won't work. You need supporting components to make 
sure everything is stable in the system, especially when dealing with 
large-scale digital systems like an iPhone. Keep in mind, that device is 
also going to require a oscillators and filters for the RF parts, as well.

It gets even more interesting when you start dealing with designing 
circuit boards, where you actively need to avoid traces from running 
parallel to each other for too much distance, lest they build a 
parasitic capacitance between them. In systems with very tight voltage 
and current tolerances, the length of traces and thickness of traces 
becomes very important as well. Traces can also act as inductors.

Some of the discrete components may be in there to also counteract some 
of these effects caused by the traces themselves on the board. You'll 
notice caps and resistors will often be very close to the pins of an IC 
to minimize any effect the circuit trace may have.

-- 
~Mike

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