Nexus One: $174.15 in Parts, $355.85 in…er…Incidentals

Published on January 11, 2010
by John Paczkowski

nexusteardownIf you were to build it yourself, Google’s new Nexus One superlative-phone would set you back about $174.15, according to a teardown conducted by iSuppli. (See table at right; click to enlarge.)

That’s almost $5 less than the $179 T-Mobile is charging for the device with a two-year service plan. But its about a third of the phone’s unsubsidized price–$530.

Which is interesting because, according to Google (GOOG) VP of Engineering Andy Rubin, the guy who quarterbacked the Nexus One’s development, smartphones, even “super” ones–shouldn’t be that expensive. “The thing I carry around in my pocket every day…shouldn’t cost four hundred dollars,” Rubin once told Ken Auletta, author of “Googled: The End of the World As We Know It.” “That’s absurd. If you add up all the components, somebody is making a lot of money.”

That somebody, in this case, would appear to be Google–though to be fair, iSuppli’s analysis doesn’t account for manufacturing, packaging, and software expenses, not to mention R&D costs, which are likely quite substantial.

One last point worth noting here, the Nexus One’s teardown cost is slightly more than that of Apple’s (AAPL) iPhone 3GS. iSuppli figures the cost of materials for that device is about $172.46.

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