Overview / Main Features
The Apple iPad is a 9.7-inch tablet device that was designed with an entirely new usage scenairo in mind (more info-tainment than computing) to address an emerging market for devices that intends to give consumers a great experience in viewing and interacting with their content. On the surface, the ½ inch thick device carries the very recognizable Apple iPhone design DNA and at cursory view, one may assume that it is nothing more than just an oversized iPod Touch. However, looking beyond that over-simplification, the iPad design speaks to the attention Apple paid to creating a truly "magical" user experience. The iPad was designed to be a very personal device with its nearly 10 inch immersive AFFS color display and equally large and accurate capacitive touchscreen overlay. Underneath the all-glass and aluminum enclosures, is an Apple first; a custom apps processor (A4) developed to be both computationally powerful and power efficient. Coupled with a dual cell 25 Watt-hour battery and 802.11n networking, the iPad is capable of 10 hours of continuous operations.
Per press releases, first release on April 3rd, 2010.
Pricing and Availability
Pricing - This specific model of the iPad (MB292LL/A, WiFi only model) with 16GB of storage is sold for $499. The 32GB and 64GB versions sells for $599 and $699 respectively at the time of writing.
Availability - Currently exclusive to the US, however, will likely be offered globally within the year.
For the purposes of this teardown analysis, we have assumed a lifetime production volume of 5M units.
As a reminder, teardown volume production assumptions are primarily used for our cost analysis in terms of amortized NRE and tooling costs, especially for custom components specific to the model being analyzed (mechanical components especially). Unless assumed volumes are different by an order of magnitude, minor changes in volume (say 1 million vs. 2) rarely have a large net effect on our final analysis because of this.
Refer to BOM (XLS file) for detailed analysis
Main Cost Drivers (Representing ~83% of total materials cost)
$65 - LG Display - LP097X02-SLA1 - Display Module Value Line Item - 9.7" Diagonal, 262K Color TFT, AFFS Technology, 1024 x 768 Pixels
$60 - Wintek - WT-1294-01 - Touchscreen Assembly - 9.7", Capacitive, ITO Glass on Glass, Painted, w/ Plastic Mounting Bracket
$29.00 - Samsung Semiconductor - K9LCG08U1M-LCB0 - Flash - NAND, 64Gb, MLC, DDP (Qty:2)
$23.75 - Dynapack - Battery Pack - Li-Ion Polymer, 3.75V, 6600mAh
$10.74 - Samsung Semiconductor - Application Processor - ARM Core, PoP
$10.55 - Enclosure, Main, Bottom - Machined Aluminum, Anodized, Etched, Printed, w/ 7 Spot-Welded Metal Tabs, & 6 Threaded Metal Inserts
$8.00 - Bluetooth / WLAN Module - IEEE802.11a/b/g/n, Bluetooth V2.1+EDR, Contains Broadcom BCM4329XKUBG
$6.70 - Samsung Semiconductor - K4X2G643GE-JGC8 - SDRAM - Mobile DDR, 2Gb, PoP
$4.88 - AT&S - 10-Layer - FR4/RCF HDI, 1+8+1, Lead-Free, Halogen-Free
$4.03 - AC-USB Adapter - 5.1V, 2.1A, w/ Clear Plastic Sleeve
$2.28 - Broadcom - BCM5973KFBGH - Microcontroller - for Touchscreen
$2.22 - Dialog Semiconductor - Power Management IC
$1.90 - Texas Instruments - CD3240A1 - Touchscreen Driver
$1.25 - Broadcom - BCM5974CKFBGH - Multitouch Controller - Capacitive, 0.13um
$1.22 - Samsung Semiconductor - ASIC, LCD Timer Controller
Direct Materials $258.69
Direct Materials + Manufacturing $268.01
What Is Not Included in our Cost Analysis
The total materials and manufacturing costs reported in this analysis reflect ONLY the direct materials cost (from component vendors and assorted EMS providers), AND manufacturing with basic test. Not included in this analysis are costs above and beyond the material manufacture of the core device itself - cost of intellectual property, royalties and licensing fees (those not already included into the per component price), software, software loading and test, shipping, logistics marketing and other channel costs including not only EMS provider and the OEM's margin, but that of other resellers. Our cost analysis is meant to focus on those costs incurred in the manufacture of the core device and exceptionally in some circumstances the packaging and literature as well.
OEM/ODM/EMS Relationships / Manufacturing
Apple has historically produced its portable product lines with a number of EMS providers / partners within China. For first generation of the iPad, Apple likely sourced the manufacturing to one of the more mature EMS providers such as Hon Hai (Foxconn).:
Furthermore, we have assumed that custom mechanicals (plastics, metals, etc.) were also sourced in China, as well. Sub-assemblies may also come from other countries of origin, but for the purposes of this analysis, when there is no proof to the contrary, we have stayed with this assumption (China being the country of origin) for all levels of assembly.
Country of Origin / Volume Assumptions
Based on markings, the unit was assembled in China. Furthermore, we have assumed that custom mechanicals (plastics, metals, etc.) were also sourced in China.
Country of origin assumptions relate directly to the associated cost of manufacturing, where calculated by iSuppli. In the cases of "finished" sub-assemblies (such as touchscreen assembly), we do not calculate internal manufacturing costs, but rather assess the market price of the finished product in which case country of origin assumptions may or may not have a direct effect on pricing.
Remember also that labor rates are applied directly only to hand inserted components and systems in our bill of materials, and although regional assumptions do, these new rates do not have a direct effect on our modeled calculations of placement costs for automated SMD assembly lines. "Auto" inserted components (such as SMT components) placement costs are calculated by an iSuppli algorithm which allocates a cost per component based on the size and pincount of the device. This calculation is affected by country or region of origin as well.
Design for Manufacturing / Device Complexity
The iPad has an overall component count of 1288 (excluding box contents), of which, only 151 are mechanical in nature. This complexity level places the iPad between the complexities of average smartphone to an average netbook.
Component counts have a direct bearing on the overall manufacturing cycle times and costs, and also can increase or decrease overall yields and re-work. Our calculations of manufacturing costs factor counts and more qualitative complexities in the design. The cost of manufacturing is also, to some extent, decreased in this case because of assumed labor rate applied for China.
Note that manual labor has a much smaller effect on auto-insertion assembly lines (for the Main PCB, for example), where manufacturing costs are much more capital equipment intensive and driven by these investment costs.
With the new Apple iPad, we anticipated to see common electronic components and designs carried over from both the iPhone and the iPod Touch. With exception of the 9.7 inch AFFS display, corresponding touchscreen overlay, larger battery pack and the introduction of the new A4 apps processor (which appears to be manufactured by Samsung and comes with a similar 256MB multi-packaged mobile DDR as with the iPhone 3GS), the prevailing theory was that there weren't much differences beyond those items.
To our surprise, we discovered 3 discrete ICs associate with the capacitive touchscreen functionality. There is a TI touchscreen driver and well as a pair of Broadcom Microcontrollers. Likely theory as to why there were 2 Broadcom ICs is that due to the large size and accuracy requirements of the touchscreen, Apple designers may have needed to split the controlling functionalities along the X and Y axis of the touchscreen. In fact, the iPad, unlike many other devices that came before it, is heavily invested in User Interface elements/components unlike traditional designs where costs centered around computational functionalities on the main PCB.
Returning to design commonalities, the iPad continues the use of Dialog Semiconductors in Power Management and we see the re-appearance of the Broadcom BCM4329 WLAN chip which first appeared in the 3rd Gen iPod Touch. The difference here with the iPad, is the full implementation of 802.11n and full antenna diversity.
Here is a summary of the major components used in the Apple iPad design:
- Display Module - LG Display - LP097X02-SLA1, 9.7" Diagonal, 262K Color TFT, AFFS Technology, 1024 x 768 Pixels
MPU / Memory
- Application Processor - Samsung Semiconductor, ARM Core, PoP
- SDRAM - Samsung Semiconductor - K4X2G643GE-JGC8, Mobile DDR, 2Gb, PoP
Battery / Power Management
- Power Management IC - Dialog Semiconductor
- LCD Timer Controller - Samsung - S6T2MLC
- Touchscreen Driver - Texas Instruments - CD3240A1
- Microcontroller - Broadcom - BCM5973KFBGH
- Multitouch Controller - Broadcom - BCM5974CKFBGH
- Audio Codec - Cirrus Logic - CS42L61
- Display Multiplexer / Demultiplexer - NXP Semiconductors - CBTL06141EE/G
- I/O Expander - Texas Instruments - TCA6408ARSVR
- Accelerometer - ST Microelectronics - LIS331DLH
- Electronic Compass - AKM Semiconductor - AK8973S
- WLAN/Bluetooth/FM Transmitter/Receiver - Broadcom - BCM4329XKUBG
- Touchscreen Assembly - Wintek - WT-1294-01, 9.7", Capacitive, ITO Glass on Glass, Painted, w/ Plastic Mounting Bracket
- Battery Pack - Dynapack, Dual Cells, Li-Ion Polymer, 3.75V, 6600mAh