Camera components represent 9.5% of total iPhone 7 material cost

It's probably in the ball-park of what the parts for a small-sensor compact camera cost, as remember they still need a processor, screen, case, controls and if you work backwards from the selling price you're not likely to get more than $26 for sensor+lens.

Oct 22, 2016permalink

aris14

Cost...? I guess they mean CIF price..!

Oct 22, 2016permalink

WilliamJ

Speak sweet about me, speak evil about me, but anyway speak of me, that's clearly the hype items policy and in that matter the iphone is king !

Oct 22, 2016permalink

tabloid

You must take into consideration research and development (past , present . future). This can cost millions.

Oct 22, 2016permalink

Photoman

But they reap billions for the millions and avoid taxes to make more billions.

Oct 22, 2016permalink

tabloid

The formula is simple..

pay tax and employ less people...who will go on the dole.
Pay no tax and employ a lot of people who pay tax.

Every university student who studies economics knows this basic formula.

Not a wise thing to get your 'miss-information' from the tabloid press.

Oct 24, 2016permalink

Photoman

So "miss-information" means I could pay more tax than million/billionaires...that sounds fair...

Oct 24, 2016permalink

tabloid

It means that you have a job.

Oct 29, 2016permalink

dansclic

Why are people wondering ? Loudspeakers for example made in China that a distributor would pay 36 usd are sold for 400 to the end consumer in Europe , and those 36 USD are not even the real costs of the speakers ..... many people have no idea....

Oct 22, 2016permalink

if i had to guess a meaningful percentage of the utility and importance to the average apple user of the camera part of the i phone i would say it surely is more than about 9 .5% ....sadly for photography the i phone is the defacto and ONLY camera many own and it seems will ever own...

when you spend a total of 26 dollars for a sensor, a processing path ,& a stack of plastic lenses, you end up with a sorry excuse for a camera ..

imagine a proper sensor of 30 to 50 sqmm ? instead of less than18 iphones have which is entirely possible ...... imagine a decent glass lens??? other do it with great success to the embarrassment of the iphone ....apple does the least it can get away with...

to their credit they do alot with that 26 dollars .... i think they've optimized and squeezed every ounce of goodness from their components... and been efficient
and done a good job with things like whit bal...just imagine

a camera worth 50 or 75 usd ....wow, bigger sensor, glass lens?

Oct 22, 2016*permalink

User7614191060

How we aloud to corporate rip of scum like Apple to over charging us. We should pres our politicians to stop corporate scum to ripping us of. Rumor sagest that iPhone bring to Apple close to $600 billions. How is that possible. If it is true that sagest that Apple is noting more then rip of scum. We should openly boycott rip of Apple...(unbelievable $600 billion profit...).

Oct 22, 2016permalink

photo perzon

The x2 jpegs are not good yet. Please fix them, Apple

Oct 22, 2016permalink

JSmitty

The best camera in the world only costs $26! Now THAT is a bargain! Well done, Apple.

Oct 22, 2016permalink

Combatmedic870

IPhones haven't had the best cameras in quite a while.

Oct 22, 2016permalink

justmeMN

Cost aside, those "cameras" don't look real impressive.

Oct 21, 2016permalink

JSmitty

Image Quality is what the artless obsess over.

Oct 22, 2016permalink

(unknown member)

@JSmitty - that is GOLD! I hope you don't mind but I am totally going to steal that phrase.

Oct 22, 2016permalink

Mike FL

How doe this guys know the price that APPLE pays?

Makes no sense at all.

Oct 21, 2016permalink

Mike FL

It is just like that you look the Dell PC and price all the parts (+ SW), the whole PC will be cheaper than you buy parts from open market.

BTW, I do not think even Dell knows the price other PC makers pay for the very same CPU foe example.

Oct 21, 2016*permalink

Haim Hadar

Exactly what I thought. Especially with Apple that is known to be brutal negotiating prices with their vendors. Very hard to believe that they pay anything close to $40 for their CPU.

Oct 21, 2016permalink

justmeMN

That's why they call it a cost *estimate*.

Oct 22, 2016*permalink

they pay for none of those things .... its costs ....and are all written off. all.... theres a reason fascist corporate america pays no taxes

Oct 22, 2016permalink

PVCdroid

Screw the vendors and overcharge the customers. Win/Win

Oct 22, 2016permalink

HeyItsJoel

How's this any different from another industry, like for instance, diamond? You didn't really think that a piece of shiny rock that DeBeers didn't even "make" but just dug off the ground, cut, polished and marketed as the greatest thing since slice bread--is really worth a man's 3-month salary did you?

Oct 21, 2016permalink

(unknown member)

To say nothing of distribution, staffing, stores, rent/leases, utilities, warranty, cost of keeping stock on hand, display units that get damaged, shelving/stands for stores, packaging, advertising/marketing, staff uniforms/shirts, insurance, and on and on and on...

But welcome to the interwebs where so much has been written by so many with so little knowledge of what they are writing/commenting about.

To the folks thinking an iPhone 7 should be sold for a few bucks over build cost, the next time you walk into ANY store or commercial entity, start doing some quick maths and add up those things,.

Oct 21, 2016*permalink

HeyItsJoel

You mocking me?

Oct 21, 2016permalink

User7614191060

Mr. Heyltsjoel, He is not mocking you, he just do not know what is talking about. If you consider that apple make over 250 billion last year sagest that they rip us of big time. Goofy idiot Mr. "Interestingness" think it is ok to pay $600 for iPhone 5, and $1000 for iPhone 6. Because we have those idiots with distorted perception, the rip of corporate scum do not hesitate to over charge us. The sad think is that our be-loving government aloud to corporation to use mafia methodology of charging.....

Oct 22, 2016permalink

in fact,....they pay for none of those things .... its costs ....and are all written off. all.... theres a reason fascist corporate america pays no taxes

Oct 22, 2016permalink

(unknown member)

@HeyItsJoel - hardly! I am mocking the armchair MBA's who think they know what they are talking about though. Good thing most of these folks don't actually run a company, it would be bankrupt in no time.

Oct 22, 2016permalink

Banhmi

Besides if ya didn't have the rabid consumer demand to rock a wicked-high 33% EBITDA margin, how would ya get the cash to so-totally-disrupt the watch & automotive industries, build-out a colossal castle of an office (just our humble HR strategy, ya know?), and sell your cool-aid drinking investors on how you're gonna save the world through renewable energy? Consumers should be THANKING Apple for these high prices!

Oct 23, 2016permalink

thank you apple for high prices

Oct 23, 2016permalink

Yake

It's the best $26 camera for sure!

Oct 21, 2016permalink

supeyugin1

But you can't buy it for $26, you pay much more than that.

Oct 21, 2016permalink

Yake

True!

Oct 22, 2016permalink

at the end of the day , its your 26 dollar camera , and it looks the part based on the images it produces

Oct 22, 2016*permalink

photosen

Which is why Tim Cook is Apple's CEO; but there is a huge cost in coming out with a working ecosystem, including a stable, user friendly OS, the right incentives for Apps, filtering and managing them, beyond the device's design and engineering, and the risk of the whole project. How many of these has Samsung aka Kaboom! mastered? Google itself? I don't even use an iPhone, but there needs to be some recognition where it's deserved, particularly for a company who almost went down several times following these notions.

Oct 21, 2016permalink

Lars V

As a comparison, the rumor was that the camera parts for the 41MP camera in the Lumia 1020 cost over $100.

Oct 21, 2016permalink

tkbslc

Apple buys hundreds of millions of units, so with quantity discounts it is probably difficult to compare.

Oct 21, 2016permalink

Lars Rehm

never heard that rumor but totally possible...when I talked to some Nokia engineers a couple of years back they basically admitted that the 1020 was simply to expensive...one of the reasons why it was a commercial failure.

Oct 21, 2016permalink

It had a huge sensor (in comparison to other phones) and needed a larger lens too, plus lots more image processing hardware, so I really wouldn't be surprised.

Oct 22, 2016permalink

J A C S

"the total bill of materials for the iPhone 7 with 128GB of built-in memory to be $275. $26..."

This sentence does not make much sense.

EDIT: Maybe because there is a new sentence starting with the $ sign.

Oct 21, 2016*permalink

The cost is considerably higher, the yield on the camera modules is only about 14% for a modern smartphone...

Oct 21, 2016permalink

Androole

That seems impossibly low. Do you have a source for that number?

However, if it's that low, a standard 300mm CMOS wafer can fit over 4000 iPhone sized sensors, so even with the abysmally bad 14% yield, that would be nearly 600 sensors.

Even at a generous $5000 per wafer, that's still under $10 per sensor.

Oct 21, 2016permalink

Is that to do with assembly, as that error rate on a wafer would make larger sensors unmanufacturable, and at these volumes they must be using the latest and greatest processes?
I'm afraid I don't find that believable without some more info, sorry.
Also if they are paying $26 for sensor + attached lens + flexi at 14% yield that's $3.64 sale cost per module so manufacturing cost will start with a 1.

Oct 22, 2016permalink

A "camera module" is a sensor and lens assembly. The lenses are each double-sided aspherics with very poor alignment tolerances. The lens elements are very difficult to reliably fabricate, and then they are very difficult to align. The yield for the iPhone 5 camera module was 14%; I do not expect it has gone up with the increasing complexity.

You can find reports on these things in the IEEE Photonics journal, or in papers at the international optical design conference, IODC.

Oct 22, 2016permalink

By "assembly" I did mean the whole module, as I explained why I thought it wasn't the chip. I also assume at 14% they just keep throwing lenses on top of them until it passes. Certainly back when I was looking at buying modules (and the company was buying modules) the prices couldn't support those yields as we were using quite expensive 1/3.2" sensors and we knew what the sensors cost alone (the modules not coming from the sensor company).

Oct 22, 2016permalink

Assemble, test, discard if it fails. It costs more time to attempt a second alignment or assembly than it does to produce an entirely new module.

Oct 22, 2016permalink

Are the sensors really that cheap, if so we're getting ripped off for all the APS and FF cameras...

Oct 22, 2016permalink

http://www.techtimes.com/articles/141123/20160316/how-much-does-it-cost-to-build-a-samsung-galaxy-s7-255-worth-of-materials.htm

A full-frame gen2 exmor chip costs about $70 to purchase.

Oct 22, 2016permalink

Old Cameras

Cut. It. In. Half!!!!

Oct 21, 2016permalink

match14

Wonder if the component costs for other manufacturers flagship phones are similar.

Oct 21, 2016permalink

Michael Long

As I pointed out below, a Samsung Galaxy S7, which retails at a similar price point, costs less at $255. The camera costs $14.

Oct 21, 2016permalink

tkbslc

Keep in mind quantity discounts. Apple sells a LOT of each model.

Oct 21, 2016permalink

Marty4650

I think most people don't understand that once you reach a certain quantity, any further discounts are just a fraction of a cent.

Apple sells more phones than Samsung does, but they both sell in the tens of millions. They both get the same, or very similar volume discounts.

This is why small car companies like Suzuki or Kia can compete with Toyota. Toyota certainly does sell more, but once you order 50,000 of anything, you are paying the rock bottom price, and it doesn't get very much better if you order 500,000.

Oct 21, 2016permalink

tkbslc

Probably, but I was thinking Apple vs someone like LG or HTC.

Apple further capitalizes on economy of scale by only producing 2-3 models at a time that use nearly identical hardware.

Oct 21, 2016permalink