iSupply worked its magic on the new iPhone 3G? and found it only costs a few bucks more to manufacture than last year’s 8GB iPhone 3G that it replaces.  Interestingly, the iPhone they tore apart contained Flash memory from Toshiba where Apple generally gets its Flash from Samsung (and had a multi-Billion dollar up front deal with the vendor).  The other three biggest changes were the new Arm Cortex Samsung processor, new autofocus 3-Megapixel camera and the Broadcom Corp. single-chip Bluetooth/FM/WLAN module.  The latter replaces two chips.

"The entry-level, 16Gbyte version of Apple Inc.’s new iPhone 3G S carries a Bill of Materials (BOM) cost of $172.46 and a manufacturing expense of $6.50, for a total of $178.96," said Andrew Rassweiler, director and principal analyst, teardown services, for iSuppli. "This is slightly higher than iSuppli’s estimate of $174.33 for the original 8Gbyte iPhone 3G based on pricing in July 2008. Although the retail price of the 16Gbyte iPhone 3G S is $199, the same as for the 8Gbyte version of the original iPhone 3G, the actual price of the phone paid by the service provider is considerably higher, reflecting the common wireless industry practice of subsidizing the upfront cost of a mobile phone and then making a profit on subscriptions."

Breakdown chart below:



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