Main Features / Overview
IP Phone - because of the nature of the product it is very customizable and can be updated and administrated via LAN. The Cisco 7960 IP phone has been around for some time. In fact the model we have torn down seems essentially identical to those used at iSuppli, which were purchased mid 2000. Although design revisions may have been made over time - from the outside, it appears virtually identical. It seems that this phone has a rather lengthy lifecycle.
For the purposes of this cost analysis, we have made an assumption that the lifetime production volume for this particular model would be 2.5M units. This figure cannot be considered to be necessarily "market accurate" but an estimate used only for the purposes of calculating certain costs which are modeled (ASICs, PCBs, plastics and custom mechanical components). Volume assumptions can have a minor affect on our cost analysis, however for the most part, for products where production volumes are at this level, fixed costs such as non-recurring engineering (NRE), tooling and other set-up costs which must be amortized over the assumed production volume. In other words, if the volume assumption is 2.5M or 5M, this typically only changes the sum total of the analysis by pennies. The volume assumption only becomes more critical in the case of very low volume productions.
This phone has a lot of mechanical components - and specifically a lot of discrete plastic parts and assemblies. In fact at a high level, plastics and other mechanical components and hardware are the largest single cost driver in the phone and weigh in at about $15. Most of the mechanical components are custom elements, and are therefore modeled using our proprietary plastics and metals models.
Mechanical components aside, however, from an electronic perspective the whole deisgn is relatively integrated with almost all of the cost and the bulk of the processing occurring in two key ASICs from Texas Instruments (private labeled as Cisco parts). In fact the main PCB represents all of the functional electronics in the phone and itself represents a total materials cost of about $35 of which the core TI/Cisco Asics are about $11, representing nearly one third of the BOM cost of the main PCB. Most other components, on an individual basis, are obviously cost contributors, but no one component really stands out past the first few lineitems. All of the electronic costs used here do not represent the "bleeding-edge" of market price as we see it, but rather represent a competitive high volume cost. That we would expect for Cisco.
Main PCB ~$35
Texas Instruments / Cisco ASIC
PCB substrate - 4 layer FR-4~$4.50
Analog Front End Chip<~$2
Display Module (5.3" Diagonal Monochrome)~$14
Enclosures - Plastics, Metals, Hardware, Etc.~$19
Subtotal Main Cost Drivers~$68
Total Materials Costs~$75
Manufacturing and Materials*~$84
* - The total materials and manufacturing costs reported in this analysis reflect only the direct materials cost (from component vendors and assorted EMS providers), manufacturing and test. Not included in this analysis are costs above and beyond the manufacture of the core device itself - cost of shipping, logistics, marketing and other channel costs including not only the EMS provider's and 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 any literature, packaging, and accessories supplied with the phone itself.
Country of Origin / EMS provider
The phone was labeled as made in Malaysia, and the handset / receiver came bagged as a finished unit labeled "Made In China". Both locations have been used, applying local loaded labor rates to calculate manufacturing of the PCBA and final assembly (both assumed to be Malaysia), and used China for the manufacture of the receiver and all of the custom plastics and mechanicals.
Overall - coming in at a component count of 671, the Cisco CP7960-G phone is relatively complex but falls in line with devices such as mid-range handsets (portable phones). It is hard to find a directly comparable point of comparison considering that we have not specifically torn down other IP phones.
From a mechanical perspective, at 135 components this model could probably stand a few improvements to lower the assembly cost. For example we were a little surprised to find out that every single rubber pushbutton in this desin was it's own discrete part. It is more common in cell phones, or even other designs such as the user interface of set-top boxes, to connect such buttons together on a sheet or interconnected using molded fingers or links to keep a cluster of related buttons together and oriented properly. This facilitates manufacturing greatly, but Cisco's EMS provider may have found some clever assembly techniques that make this a minor adder.
- Texas Instruments - F731891PDV - ASIC
- Texas Instruments - F731532APGE - ASIC
Other Major Chips
- Broadcom - BCM5912KQM - Ethernet Transceiver - Dual
- Analog Devices - AD73311L - Analog Front End - General Purpose, Single Channel, 3V
- Cypress - CY7C1041CV33-10ZC - SRAM - 4Mb (256K x 16)
- AMD - AM29LV800DB-70EC - Flash - 8Mb, 3V, 0.23um, Bottom Boot
- Primary: 5.3 Inch, STN Monochrome