The current issue of EETimes gives us a good look at the innards of the new iPod Nano. Earlier posts on the new iPod have noted the “Apple”-branded chips, which are identified in this teardown. PortalPlayer had supplied the media processor for the original Nano, and has been replaced in the 2nd generation design:
An Apple-labeled ASIC, the S5L8701- B05, comes from Samsung and is responsible for all audio and still-image decoding. Other than the Apple proprietary markings on the Nano’s CPU, labeling tells of an ARM core within the Samsung chip, under 6 x 6 mm in die size, and packaged in an underfilled ball grid array package similar to the Nano’s PortalPlayer-based predecessor. Unlike the first-generation design, which had a separate NAND controller component from SST, the Samsung CPU appears to have integrated the NAND interface directly, reducing cost and complexity.
The article estimates the build cost at $65 to $132 depending on the amount of flash memory, leaving a healthy margin.
Add it all up and the 2-Gbyte second-generation Nano is estimated to have a direct production and materials cost in the range of $65, inclusive of the accessories (earbuds, USB cable, dock adapter). Assuming a slight premium for higher-density NAND stacks, we estimate the 4- and 8-Gbyte versions would have a materials and production cost in the range of $87 and $132, respectively. With retail prices of $150, $200 and $250 for the three models (2 Gbytes, 4 Gbytes, 8 Gbytes), gross margins look good, ranging from 56 percent at the low end to 47 percent at the high end. Of course, other indirect costs related to product development, marketing, shipping and any software licenses are absent from these figures, but the story remains pretty positive no matter what.
I just replaced the battery in my wife’s iPod Mini this weekend, but we’ll probably end up with a new Nano shortly.
See also: Apple’s new iPod family — who benefits? (AppleInsider)