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Breakdown: The Bold Costs RIM $170 To Make

iSuppli is at it again. This time, it got its mitts on a BlackBerry Bold smartphone, dismantled it, and came up with the cost of materials. The sum of parts, labor and testing is about $170. Reports suggest the phone will sell for $300 when it arrives in the U.S. That's some healthy margins for RIM.
iSuppli is at it again. This time, it got its mitts on a BlackBerry Bold smartphone, dismantled it, and came up with the cost of materials. The sum of parts, labor and testing is about $170. Reports suggest the phone will sell for $300 when it arrives in the U.S. That's some healthy margins for RIM.iSuppli loves to take things apart and tell us all about their guts. They've taken apart the iPhone, the iPhone 3G, and myriad other devices. iSuppli then analyzes the materials inside and comes up with an estimated cost for those materials. In the BlackBerry Bold, iSuppli says the materials alone cost $158.16. Labor and testing adds $11.25 and brings the total cost to $169.41.

BusinessWeek offers a nice analysis of how this cost will affect RIM's bottom line in the quarter to come. Writer Arik Hesseldahl says, "RIM is certainly spending more on the components of its most recent line of phones, a reflection of the high price of competing with Apple. RIM spent $103 in materials and assembly cost for the Curve, RIM's older mainstream device that works on an older network technology than the Bold."

Despite the large rise in cost for making the Bold (compared with the Curve), the suggested retail price of $300 leaves RIM plenty of room to earn some money on the device. However, Hasseldahl notes that the estimates from iSuppli fail to tally the expense of creating the software, the cost of marketing the device, and shipping it from its point of manufacture to points around the globe. Those will definitely eat into what could otherwise be close to $130 in profit for the device.

Still, RIM and U.S. carrier partner AT&T need to get the device to market before anyone is going to make any money selling it. At this point, no one knows exactly when that will be.

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Sara Peters, Editor-in-Chief, InformationWeek / Network Computing
John Edwards, Technology Journalist & Author
John Edwards, Technology Journalist & Author
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