iPhone 6 Plus carries hefty premium — IHS

iPhone 6 Plus carries hefty premium — IHS

24 SEP 2014

Apple’s iPhone 6 Plus is just $15.50 more expensive for Apple to produce than its smaller sibling, despite costing consumers an extra $100 to buy.

A teardown of the iPhone 6 bill of materials (BOM) by analyst firm IHS Technology showed that Apple is gaining a larger margin on the Plus version, by offering an extra 0.8 inches of screen.

The BOM for the iPhone 6 with 16GB of memory is $196.10, rising to $200.10 when $4 of manufacturing expense is added, according to IHS. For the iPhone 6 Plus, the BOM is $211.10, which rises to $215.60 with the addition of the $4.50 manufacturing cost.

The iPhone 6 is priced at $200 with an operator contract, while the Plus is $300. The unsubsidised prices are $649 and $759, respectively.

“Apple has always been adept at offering higher-end iPhone models with enhanced, desirable features—and then pricing those versions for maximum profitability,” noted Andrew Rassweiler, senior director for cost benchmarking services at IHS.

Rassweiler added that Apple has historically boosted margins on devices with greater memory capacity but appears to be doing the same with screen size.

The iPhone 6 has a 4.7 inch screen, compared with the 5.5 inches on the Plus. According to IHS, the difference in screen size comes at a cost of $7.50 — $45 versus $52.50.

The slightly higher-capacity battery in the Plus is $1 more expensive to produce than for the standard device, while the camera on the larger device comes in at $1.50 dearer.

IHS stressed that the teardown estimates are preliminary and only account for hardware and manufacturing costs, with software, licensing and royalties excluded.

In a related development, there have been reports that the structural rigidity of the new iPhone models appears to have suffered due to their thinner bodies and bigger screens.

A number of users claimed their device has become warped while they have bent down with the device in their front or rear trouser pocket. From the pictures posted online, the weakness appears to be around the volume buttons where the frame is thinnest.

The news comes is despite SquareTrade, which offers extended iPhone warranties, claiming that the new iPhone models are more robust than their predecessors.

According to The Guardian, other smartphones to have suffered from this type of weakness in construction include Sony’s Xperia Z1, Samsung Galaxy S4 and BlackBerry Q10. There have also been similar complaints about previous iPhones.

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Tim Ferguson

Tim joined Mobile World Live in August 2011 and works across all channels, with a particular focus on apps. He came to the GSMA with five years of tech journalism experience, having started his career as a reporter... More

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