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Wednesday, 06 October 2010 10:05

Apple TV is a cut price iPad

Written by Nick Farell
apple

Jobs' Mob earns more cash on same design
Fruity peddler of broken iPhones Apple is making more money out of its iPad and iPhone design by flogging the same gear as its set top box. According to analysts iSuppli the Apple TV is just an iPad without the touch screen and the stonkingly huge price tag.

The new Apple TV costs $63.95 to make, which means that Jobs' Mob is shipping it with a much lower mark up than its other toys. The Apple TV's price is about 35 per cent above its manufacturing cost.

Andrew Rassweiler, director, principal analyst and teardown services manager, for iSuppli said that the second generation Apple TV is more like an iPad or iPod Touch with no display. Under the bonnet is an A4 processor core, Wi-Fi/Bluetooth chip and power management chip which are the same building blocks used in the, iPad, iPhone 4 and iPod Touch.

Most of the hardware is made by its chum Samsung which makes the Apple-labeled A4 applications processor in the Apple TV, along with the mobile Double Data Rate (DDR) SDRAM.

Isuppli found that there was an empty slot on the Apple TV's Printed Circuit Board (PCB) that suggests Apple can at least double the NAND flash capacity.

The point is that the Apple TV is retailing at about $99 while the iPad is hitting the shops for more than $700. Even allowing for the cost of a touch screen, Apple is making a lot of mark up on the iPad.  If Apple's mark up logic was applied across the board, then the Apple TV would be retailing at about $500. A 35 per cent mark  up is nothing in comparison to the mark up on its other gear.

It seems that Jobs' Mob must be hoping to claw back money through content rental and other agreements. This means that your $99 investment might appear cheap, in the long term it could prove expensive.

Nick Farell

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