Apple's New iMac Costs $873 To Manufacture

SAN JOSE, Calif. — Apple Computer Inc.'s first desktop PC based on Intel Corp.’s microprocessors also includes other devices and displays from ATI, LG.Philips, Maxtor and Samsung, according to iSuppli Corp.

Sources also reportedly believe that the new Apple machine includes a CMOS image sensor from Micron Technology Inc. This enables the PC to support an integrated PC camera, which provides video conferencing and related functions, according to sources. Apple’s so-called iSight camera is built into the thin bezel just above the display.

The new Apple iMac desktop PC, introduced at last week's MacWorld Expo, is based on Intel's Core Duo microprocessor. The Core Duo is Intel’s first dual-core product designed for notebook PCs. The total bill of materials (BOM) for the entire system is $873, according to preliminary data from iSuppli’s Teardown Analysis Service. Apple is selling the low-end version of the Intel-based iMac analyzed by iSuppli for a suggested retail price of $1,299. Apple’s new machine marks a major departure for the company, which has never used an Intel-made microprocessor in its PCs. In the past, the company used PowerPC chips made by IBM Corp. and Freescale Semiconductor Inc. over the past decade. iSuppli's teardown of the new iMac revealed that Apple also is using Intel's mobile 945 core-logic chipset to support the Core Duo microprocessor, according to the market research firm. iSuppli estimates the cost of the microprocessor is $265, while the two-device chipset carries a cost of $45. Together, the Intel microprocessor and Mobile 945 chipset account for 35 percent of the new iMac's total BOM, according to Andrew Rassweiler, teardown services manager and senior analyst for iSuppli. Other major elements contributing to the iMac's BOM cost include the following: LG.Philips LCD's 17-inch wide-format LCD panel; Maxtor Corp.'s DiamondMax 10/6L160M0HDD 160Gbyte SATA hard disk drive; ATI Technologies Inc.'s Radeon X1600 graphics processor; and Samsung Electronics Co Ltd.'s Double-Data Rate (DDR) SDRAM. Above the $873 BOM, the iMac carries a $25 manufacturing and test cost, adding up to an $898 cost. This cost estimate does not account for other items included in the box with the iMac, including the keyboard, the mouse and documentation.