iSuppli: Samsung Galaxy Tab Beats iPad On Manufacturing Costs

Nicholas Kolakowski eWEEK USA 2013. Ziff Davis Enterprise Inc. All Rights Reserved.,

Samsung’s Galaxy Tab may not be starting a price war with the iPad in the UK, but it costs substantially less to make, according to iSuppli

Samsung’s Galaxy Tab is an iPad competitor in more ways than one, apparently: According to research firm iSuppli, the Android-powered tablet PC’s parts cost $205.22 (£128), less than the estimated $264.27 for the 16GB iPad with 3G. Combined with an estimated manufacturing cost of $9.35 per unit, iSuppli’s grand total for the Galaxy Tab rises to $214.57.

The Galaxy Tab’s 7-inch TFT-LCD display is responsible for the bulk of that lower cost – at an estimated $57, it lags far behind the iPad’s 9.7-inch screen at $98. The screen accounts for 27.8 percent of the Galaxy Tab’s bill of materials (BOM).

Screen differences

“Instead of matching up with the iPad on a feature-by-feature basis, the Galaxy Tab really is [a] larger version of Samsung’s Galaxy S smart phone,” Andrew Rassweiler, director, principal analyst and teardown services manager for iSuppli, wrote in a 1 November statement. “While the design approach makes the Galaxy less expensive to produce than the iPad 3G, it also makes for a product that lacks the same usability.”

The crucial element in the comparison, Rassweiler continued, is the screen. “The Galaxy Tab’s screen resolution, size and technology are not at the same level as the iPad. This is a critical difference, given the fact that the display is a key differentiating factor for the iPad.” The Galaxy Tab offers 1,024 x 600 resolution, compared to the iPad’s 1,024 x 768.

Behind the $57 screen, the Galaxy Tab’s next-largest cost is its memory subsystem, at $51. The subsystem combines a Samsung multichip package with 16GB of NAND flash memory from SanDisk. After that comes “numerous mechanical and electromechanical components”, with a combined cost of $15.22.

In fourth place on iSuppli’s list comes the user interface subsystem, including the gyroscope and capacitive touch-screen controller, at $13.87. The battery costs $10.60, the baseband system $10.07, and the radio frequency/power amplifier subsystem $9.09. Those are followed by the applications-processing subsystem at $8.84.

UK pricing

In the UK Vodafone is offering the Samsung Galaxy Tab for £499,on a monthly plan from £3 for occasional users, to £25 for a 5GB allowance.

Orange meanwhile is mirroring Currys in offering the Galaxy Tab for £529, SIM-free. With Orange, the tablet is available on one and 12 month contracts. The Orange Racoon plan for example is £5 per month for 500MB. A 12 month £5 per month (500MB) contract lowers the purchase price down to £499. Carphone Warehouse meanwhile is offering it for £529.00, on a variety of plans.

At the time of writing O2 has yet to update its Galaxy tab webpage with pricing information, but reports indicate that it will sell the Galaxy Tab for the full asking price of £599.

Samsung hopes that the tablet’s 3G connectivity, video conferencing, Android 2.2 operating system and support for Adobe Flash will all help differentiate it from the Apple iPad, which shipped 4.18m units in the fiscal 2010 fourth quarter.