iPod nano hardware costs less than half retail price

I’ve made tentative plans to have my body opened up (after my death, of course) and each of the constituent parts valued; that way people will know just how much has been spent on me compared to my inherent worth.  After all, it’s an indignity most new iPod models suffer: research firm iSuppli have been poking around in the cramped innards of a new nano and found that, thanks to some canny parts juggling, Apple have reduced build cost by over $13 from previous models.  Turns out that the 4GB nano you pay $150 for has less than $60 worth of components, while the $200 8GB version has under $83.

Now I’m not suggesting that Apple are screwing people over; they price their products according to what the market will support, and there are obviously a fair few people out there willing to pay for the latest Cupertino toy.  The raw hardware figures don’t take into account research & development costs, either, nor the price of actually putting the thing together.  Still, rough estimates peg profit margins at 30 to 35-percent, with many of the savings made through rival component manufacturers vying for Apple’s attentions.

iSuppli predicts nano sales of 23 million by the end of 2007, with a further 28 million sold in 2008.

Business Week [via The Raw Feed]