How is a cheap iPhone "cheap"?

There are several rumours that the price of the cheap iPhone is less than $400, about RMB 2400, and about 2600. It's hard to believe that (although the credibility of cheap iPhones is very high, there are manufacturers in Shenzhen that have been making inexpensive accessories for the iPhone. ). But if a cheap mobile phone is used, where will Apple reduce costs? The first common reaction is the “screen, CPU, storage, enclosure, and packaging”. How much can these costs be saved?

Taking the iPhone 5 with 16G memory as an example, look at the components and costs of the iPhone. The total price is US$199. Among them, the bulky ones and the ones that may be replaced by cheaper components: the display is $44, the A6 processor is $17.5, the camera is 18 knives, the wireless group (RF, IF, baseband) is 34 dollars, and the storage is 21 dollars.

The rumors of the cheap version of the iPhone will be equipped with "4-inch screen, 9mm thickness of the fuselage, and equipped with a colorful body shell, and equipped with A6 processor, iOS 7 operating system, but in order to reduce costs, the cheap version of the iPhone may use plastic material "The shell" may not be true, but according to Apple's style, even if it is necessary to control costs, it will not use crude materials and labor. It seems that there are not many places that can be saved. According to understanding, the original iPhone 5 CNC aluminum alloy shell costs about 6 US dollars, and replaced by polycarbonate shell after the cost will be about 1.5 US dollars; if you replace the A6 chip Snapdragon, you can probably save 6,7 US dollars . The use of previous-generation components is a basic cost control method that can be used for bulk compression.

However, the total base cost of the component cost of 199 US dollars is here, saving half and only 100 US dollars, and this is basically unlikely. The cost of mobile phones consists of such major components: component purchase costs, foundry processing costs, packaging material costs, production losses, supplier R&D expenses, molds and other one-time cost amortization, after-sales service charges, and sales expenses (warehousing logistics fees , collection fees and insurance, etc.), hardware and software R & D costs, labor costs, various taxes and fees, etc., there are some fixed expenses there is "one point can not be less." But after all, the mass production for so long, as long as Apple seriously want to push a low-end mobile phone, some of the early investment into the cheap iPhone can be distributed here, does not include the cost of cheap iPhone.

In this way, the basic cost of the entire mobile phone production can be reduced considerably. But for Apple, the significance of the productivity boost brought by the cheap iPhone is crucial, and the optimization of the supply chain - after all, when the capacity reaches 1 million, the cost of the 100th millionth handset will be almost negligible - The resulting increase in financial turnover is far more important than the cost of a low-end mobile phone. If it is a strategic product, Apple has every reason to use the income of other places to subsidize the cheap iPhone.