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The Palm Pre Costs Less To Build Than The iPhone, Storm And G1

The price point of the Palm Pre has been a much-debated topic ever since the phone was announced. iSuppli hasn't coughed up that nugget of information, but has estimated that the Pre costs a mere $138 to manufacture.
The price point of the Palm Pre has been a much-debated topic ever since the phone was announced. iSuppli hasn't coughed up that nugget of information, but has estimated that the Pre costs a mere $138 to manufacture.BusinessWeek has a write-up of the latest report issued by iSuppli. In the report, iSuppli estimates that the Palm Pre is costing about $138 to make.

Normally, iSuppli makes its estimates of cost after receiving a production unit. This time around, iSuppli is making some educated guesses based on what it believes to be current market prices for core components.

iSuppli believes the touch screen will be the most expensive portion of the Pre, costing Palm about $39.51 to add to the phone. The Texas Instruments OMAP processor will run $11, the memory chip about $16, wireless components $15, and the camera module about $12. Toss in a few other components, and iSuppli says $138 is the magic total number. That's less than it costs Apple to build the iPhone ($174), less than it costs RIM to make the BlackBerry Storm ($203), and less than it costs HTC to build the G1 Android phone ($144).

iSuppli suggests that it is cheaper because the cost for many of the key components has dropped in recent months, lowering the overall cost of materials.

Of course, none of that includes the cost to develop the phone itself or its operating system, webOS, which is assuredly massive.

How much will the Pre cost users? BusinessWeek believes that Palm will sell the Pre to Sprint for $300, which will in turn sell it to end users for $200 after a $100 subsidy.

None of that has been confirmed by Sprint, though.