Overview / Main Features
The 2nd generation Apple iPod Touch is currently being offered concurrently with Apple's flagship 3rd Generation iPod products in the 8GB capacity. As with the 1st generation iPod Touch, the 2nd Gen device shares the same user interface, application platform and operating system as the company's more successful iPhone line. As an iPod model introduced between the Apple iPhone 3G and the 3GS, the [2nd Gen] iPod Touch offers telltale signs of design evolutions like the integration of the WLAN and Bluetooth functionalities and upgrades in apps processor performance that also appears in the iPhone line. Overall, the size and dimensions remains exactly the same as the first iPod Touch introduced in late 2007. The primary display on the media player is still a 3.5-inch with a capacitive touch overlay also found in the Apple iPhone.
Pricing and Availability
At the time of writing the 8GB version of the iPod touch sells for $199. Apple also have the 3rd Generation iPod Touch at 32GB and 64 GB capacities selling for $299 and $399 respectively.
For the purposes of this teardown analysis, we have assumed a lifetime production volume of 10M 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 increment by an order of magnitude. Minor changes in volume (say 1 million vs. 2) rarely have a large net effect on our final analysis.
Main Cost Drivers (Representing ~90% of total materials cost)
$17.50 - Display Module Value Line Item - 3.5" Diagonal, 16M Color TFT LCD, 320 x 480 Pixels, Widescreen
$16 - Samsung Semiconductor - K9HCG08U5M-LCB0 - Flash - NAND, MLC, 8GB
$15.60 - Touchscreen Assembly - 3.5" Capacitive, 2-Layer Glass, Black Painted, w/ Flex PCB and Board to Board Receptacle Connector
$7.30 - Murata - WLAN/Bluetooth/FM Radio Module - WLAN IEEE802.11b/g, Bluetooth V2.1+EDR, FM Radio Receiver
$6.13 - Samsung Semiconductor - Video / Applications Processor - ARM Core, PoP
$3.70 - Hynix - H5MS1Gxxxxx - SDRAM -
$2.35 - Battery - Li-ion Polymer, 3.7V, 730mAh, 2.7Whr, w/ Power Managemnet Circuit & Interconnect Flex PCB
$1.95 - 2-Layer - Flex Kapton, Lead-Free, Halogen-Free
$1.80 - Touchscreen Controller Module
$1.45 - Enclosure, Main, Bottom - Machined Stainless Steel, 13-Piece, 88 Spot Welded Points, Polished, Printed
$1.05 - Headset - Stereo, 3.5mm, w/ Clear Plastic Packaging Sleeve
$0.88 - Intersil - ISL59121 - Video Driver - 3 Channel, w/ LPF (Based on ISL59123)
$0.80 - Dialog Semiconductor - D1759A - Power Management IC
$0.75 - Cirrus Logic - CS42L58 - Audio Codec - Stereo, w/ Headphone Amplifier
Total BOM Costs$89.82
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 costs. 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.
Country of Origin / Volume Assumptions
Apple has historically produced its iPod product lies with a number of EMS providers / partners:
iPod Shuffle: Asustek
iPod Nano: Hon Hai, Inventec Appliances
iPod Video: Quanta (and possibly Inventec Appliances)
iPod Touch: Hon Hai
These manufacturers produce the bulk of the iPods in China.
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 assumptions relate directly to the associated cost of manufacturing, where calculated by iSuppli. In the cases of "finished" sub-assemblies (such as the touch sensor, touch assembly PCB, TFT and the integration of these elements), 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.
The Apple iPod Touch features a total component count of 515 components (not including box contents & accessories), of which 101 components are mechanical in nature. This represents a decrease from the 580 number of the 1st generation iPod Touch.
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.
The iPod Touch is uniquely designed to optimize the space, volume and costs. The core silicon (Samsung apps processor packaged on package with Hynix SDRAM) has been updated from the first generation iPod Touch apps processor [which hints at the evolutionary direction as in the Apple iPhone 3G which shares much of the design DNA]. Also, in the 2nd gen iPod Touch, Apple has replaced the Marvell WLAN chip with an integrated Broadcom Bluetooth/WLAN chip with, interestingly enough, FM functionality (packaged by Murata). [Interesting in that the current firmware for the iPod Touch does not yet support FM radio functionalities. However, Apple is known to later announced support for new features after production introductions.] We've seen an uptick in the use of Broadcom solutions in many other Apple products analyzed in the recent year - especially in touchpad and touchscreen controllers - an indication of Apple's preference towards this component supplier. Another design change to note is the switch from TSOP flash memory package to the denser BGA package [from the 1st gen to the 2nd generation].
Here's a summary of the Apple iPod Touch 8GB (2nd Gen) design:
- Video / Applications Processor - Samsung Semiconductor, ARM Core, PoP
- SDRAM - Hynix - H5MS1Gxxxxx, Mobile DDR, 1Gb, PoP
- Flash -Samsung Semiconductor - K9HCG08U5M-LCB0, NAND, MLC, 8GB
- Power Management IC - Dialog Semiconductor - D1759A
Audio Codec - Cirrus Logic - CS42L58, Stereo, w/ Headphone Amplifier
Accelerometer - ST Microelectronics - LIS331DL, MEMS, 3-Axis, 2g/8g, Digital Output
- WLAN/Bluetooth/FM Radio Module - Murata - WLAN IEEE802.11b/g, Bluetooth V2.1+EDR, FM Radio Receiver (contains Broadcom BCM4325GKWBB)
- 3.5" Diagonal, 16M Color TFT, 320 x 480 Pixels
- Touchscreen Assembly - Polycarbonate, w/ PCB
- Same technology as iPhone - however different implementation
- Battery - Li-Ion Polymer, 3.7V, 730mAh