ISuppi has revealed the estimated manufacturing costs of yet another widely popular electronic device, Amazons Kindle 2. After performing a teardown, the firm concluded that each Kindle 2 runs approximately $185.49 to produce in-total, or 52% less than its MSRP of $359.
Engineered to conserve battery life and reduce eye strain, E Inks $60 display module is said to consume the greatest cost-percentage (41.5%) of any other component on the bill of materials. This isnt a surprise given the displays electrophoretic bistable technology, which allows it to show an image regardless of whether or not power is present. It also supports 16-level grayscale images, whereas the previous Kindle supported a mere 4-level. Ditching the first-generations integrated wireless chipset, the next greatest cost factor in the Kindle 2 is Novatel Wireless Inc.s $39.50 turnkey wireless broadband module.
Although its easy to deduce that the Kindle 2s profit margin is pretty large, iSupplis analysis is forced to negate the costs associated with intellectual property, royalties, licensing and other fees.