1. Blackintuit's Avatar
    Teardown estimates the Galaxy Note 4 at $260 in components. This is without any software dev costs, and is only about pricing the hardware components alone.
    Samsung Galaxy Note 4 Teardown Part Cost - Business Insider
    and
    Samsung Note 4 & Alpha Teardown

    Up from $240 for the Galaxy Note 3
    Samsung Galaxy Note 3 costs $240 to build, display most expensive part

    Teardown.com prices Note 4 at 0 in parts-cogs.png
    10-07-2014 02:53 PM
  2. Gator352's Avatar
    260 to manufacture the phone. Prolly sold it to the carriers for 450. The rest is markup to us, the consumer.
    10-07-2014 05:53 PM
  3. TechNut79's Avatar
    Pretty disgusting considering those that are putting them together make very little.

    Note 2 via Android Central App
    10-07-2014 06:06 PM
  4. itsnotmeitsyou's Avatar
    260 to manufacture the phone. Prolly sold it to the carriers for 450. The rest is markup to us, the consumer.
    Not even close. $260 is only the cost of the hardware. There are many other costs involved--including variable costs such as logistics, payroll, etc. And fixed/overhead costs such as those related to its time spent in the factory and on the machines.
    10-07-2014 06:23 PM
  5. IrishFXDB's Avatar
    Parts cost != manufacturing cost...

    Factories cost money, labor costs money, people that designed it cost money, software development costs money, shipping costs money. None of that money is included in the simple parts breakdown cost.

    Posted via the Android Central App
    monsieurms and rvhs03 like this.
    10-07-2014 07:56 PM
  6. Gator352's Avatar
    Not even close. $260 is only the cost of the hardware. There are many other costs involved--including variable costs such as logistics, payroll, etc. And fixed/overhead costs such as those related to its time spent in the factory and on the machines.
    What? I just broke it down to 3 parts. I didn't go into symantecs.

    Look at the very top of the parts list....ASSEMBLY & TEST.....that is the manufacturing part. So assembly is included in that cost. All parts including assembly and testing = 260.

    Like I said: 260 to manufacture per phone-------Sold to carriers for 450 per phone which is a 190 dollar markup per phone (markup includes all you mentioned)-------Carriers sell it to us for 750-800 per phone which is a 300 to 350 dollar markup per phone. All that's mentioned (logistics, labor, designing, packaging, software, payroll, overhead, and etc.) is included in the markup on both ends. Don't confuse markup with profit. Markup just covers the costs incurred from development to your hand. Profit could be 10% - 50% of that markup.

    No. It's not accurate. But it is close enough for horseshoes and hand grenades.
    10-08-2014 03:56 AM
  7. monsieurms's Avatar
    So actual cost of production is about 1/3rd of T-Mobile's price, which may be ignoring some other things like amortization of fixed costs. I don't see how I can get excited about that.

    They're entitled to a profit. T-Mobile and others have to make one too. There are a lot of hands in the pie.
    10-08-2014 05:49 AM
  8. Gator352's Avatar
    So actual cost of production is about 1/3rd of T-Mobile's price, which may be ignoring some other things like amortization of fixed costs. I don't see how I can get excited about that.

    They're entitled to a profit. T-Mobile and others have to make one too. There are a lot of hands in the pie.
    Yup! Just don't confuse markup with profit. The profit margin could be low or it could be high. We just don't know.
    10-08-2014 05:59 AM
  9. itsnotmeitsyou's Avatar
    What? I just broke it down to 3 parts. I didn't go into symantecs.

    Look at the very top of the parts list....ASSEMBLY & TEST.....that is the manufacturing part. So assembly is included in that cost. All parts including assembly and testing = 260.

    Like I said: 260 to manufacture per phone-------Sold to carriers for 450 per phone which is a 190 dollar markup per phone (markup includes all you mentioned)-------Carriers sell it to us for 750-800 per phone which is a 300 to 350 dollar markup per phone. All that's mentioned (logistics, labor, designing, packaging, software, payroll, overhead, and etc.) is included in the markup on both ends. Don't confuse markup with profit. Markup just covers the costs incurred from development to your hand. Profit could be 10% - 50% of that markup.

    No. It's not accurate. But it is close enough for horseshoes and hand grenades.
    Like I said, that's way off. I'll just keep it simple. There's no way that Samsung would allow their middle man to make double the amount of money they do on each phone. Like you also mentioned, there are other costs added on top of that $260. Not to mention that the carriers have continuously stressed that they make little or nothing on selling phones.
    10-08-2014 08:49 AM
  10. dpham00's Avatar
    Not to mention that the carriers have continuously stressed that they make little or nothing on selling phones.
    Depends on the device. At release carriers were selling the Moto X 2013 for 70% more than what they paid for them. That is imo, a good chunk of money.


    Sent from my Verizon Samsung Galaxy Note 3
    10-08-2014 09:33 AM
  11. itsnotmeitsyou's Avatar
    Depends on the device. At release carriers were selling the Moto X 2013 for 70% more than what they paid for them. That is imo, a good chunk of money.


    Sent from my Verizon Samsung Galaxy Note 3

    They were charging 70% more than what they paid for them or what we would pay for them elsewhere? Either way, the carriers must not have really wanted to sell that phone. The only phone that we have actually seen estimated numbers talked about is the iPhone. I don't have any sources on-hand, but carriers have mentioned making at most $100 on an iPhone, and in a lot of cases, losing money on the sale of an iPhone. I know T-Mobile's CEO John Legere has mentioned many times that we are essentially buying the device from the manufacturer, and they are only providing you a place to buy the phone so you can use their services--where they get their money from. I would think that carrier phone sales is more of a commission based system, rather than them making much on markups.
    10-08-2014 10:05 AM
  12. dpham00's Avatar
    They were charging 70% more than what they paid for them or what we would pay for them elsewhere? Either way, the carriers must not have really wanted to sell that phone. The only phone that we have actually seen estimated numbers talked about is the iPhone. I don't have any sources on-hand, but carriers have mentioned making at most $100 on an iPhone, and in a lot of cases, losing money on the sale of an iPhone. I know T-Mobile's CEO John Legere has mentioned many times that we are essentially buying the device from the manufacturer, and they are only providing you a place to buy the phone so you can use their services--where they get their money from. I would think that carrier phone sales is more of a commission based system, rather than them making much on markups.
    Motorola sold the Moto X to att for $350. At release Att sold it to customers at $200 on contract or $600 off contract.

    http://m.androidcentral.com/stock-talk-economics-moto-x

    For iPhone, would agree that carriers make little to no profit. And every time I was in the Verizon store, I saw them trying convince someone to NOT get the iPhone. I am sure Verizon is only selling it because they don't want to lose customers. In any event carriers make up for it in monthly fees.

    Sent from my Verizon Samsung Galaxy Note 3
    10-08-2014 10:18 AM
  13. itsnotmeitsyou's Avatar
    Motorola sold the Moto X to att for $350. At release Att sold it to customers at $200 on contract or $600 off contract.

    Stock Talk: The economics of Moto X | Android Central

    For iPhone, would agree that carriers make little to no profit. And every time I was in the Verizon store, I saw them trying convince someone to NOT get the iPhone. I am sure Verizon is only selling it because they don't want to lose customers. In any event carriers make up for it in monthly fees.

    Sent from my Verizon Samsung Galaxy Note 3
    Are they estimating that AT&T paid $350 for the phones from Motorola because that is what customers were paying for them? I haven't seen any sources of the $600 off-contract price tag, but if that is the case, they must have been indirectly saying "if you don't want a contract, go buy it from Google/Motorola."
    10-08-2014 10:25 AM
  14. dpham00's Avatar
    Are they estimating that AT&T paid $350 for the phones from Motorola because that is what customers were paying for them? I haven't seen any sources of the $600 off-contract price tag, but if that is the case, they must have been indirectly saying "if you don't want a contract, go buy it from Google/Motorola."
    At the time of the article, the full retail was around $600. It did drop at a later date. Just a minor correction, att full retail was $580. So att markup was 66%,not 70%. Verizon and tmobile full retail was $600



    http://www.technologytell.com/gadget...-underway-yet/

    Sent from my LG G Pad 8.3
    10-08-2014 10:42 AM
  15. Gator352's Avatar
    Like I said, that's way off. I'll just keep it simple. There's no way that Samsung would allow their middle man to make double the amount of money they do on each phone. Like you also mentioned, there are other costs added on top of that $260. Not to mention that the carriers have continuously stressed that they make little or nothing on selling phones.
    My estimates are not "way off". They are in the ball park. Sure there are other costs involved so 260 probably isn't accurate....that's why I said "It's not accurate". Besides no one knows what kind of "contract" the manufacturers have made with the carriers....

    Carriers making little to nothing selling phones? That's for a two year subsidy but they are going by by's here pretty soon. On Payment plans or buying them outright, you're paying full retail and there's one hell of a markup.
    10-08-2014 02:54 PM
  16. itsnotmeitsyou's Avatar
    My estimates are not "way off". They are in the ball park. Sure there are other costs involved so 260 probably isn't accurate....that's why I said "It's not accurate". Besides no one knows what kind of "contract" the manufacturers have made with the carriers....

    Carriers making little to nothing selling phones? That's for a two year subsidy but they are going by by's here pretty soon. On Payment plans or buying them outright, you're paying full retail and there's one hell of a markup.
    I completely understand where you're coming from, but I'm talking about the the $450 price you are saying the carriers pay being too low. Until we (probably never) see official numbers, it's impossible to say. So, until then, we can just agree to disagree, shake hands, and be forum friends

    Sent from my LG-D851 using Tapatalk
    Katrina White1 likes this.
    10-08-2014 07:32 PM
  17. deparson's Avatar
    Going to guess that you need to add another $25 / unit for distribution and service (import, stocking, shipping, returns, shrinkage) + $10 for capital costs of manf. + $5 3rd party IP + $25 for fixed overhead and corporate allocations.

    So, $260 + $65 = $325/unit fully loaded cost. They are selling these to carriers and retailers in the $550-$600 range though some side channel arrangements might drive that down to $525-$550 or so over time at volume. Carriers sell for between $250 and $850 depending on contract status, etc.

    Also note that Samsung is kicking back a lot of money to consumers on the pre-orders with the $200 min. trade in deal. I expect some sort of ongoing promotion shortly after launch to move units similar so they are not making a ton of profit on each device. Consumer electronics is a hard business.
    monsieurms likes this.
    10-08-2014 09:07 PM

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