Google Nexus 7 teardown reveals £5 cost difference between high and low end models

By Peter Gothard
13 Jul 2012 View Comments

A ‘teardown' of Google's Nexus 7 tablet by research company IHS's has revealed that the company seems to be using the decision not to include SD card support on the machine to its distinct advantage. The $50 (£32.17) retail price difference between 8GB and 16GB versions of the machine can be broken down into a manufacturing cost gap of only $7.50 (£4.82).

The bill of materials (BOM) price of the Asus Nexus 7 is $159.26 (£102.46) for the 8GB model, while the 16GB edition weighs in at $166.75 (£107.28). All components, finds HIS's study, are identical bar the storage space loadout, which comes in at $13.50 (£8.70) for 8GB and $21.00 (£13.51) for 16GB in accordance with current costs of solid state storage.

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This sees the Nexus 7 making a retail profit of $42.50 (£27.34) per 16GB model at retail, as Google adds $50 retail value for $7.50 worth of storage space.

Though limiting end users' abilities to add their own storage solutions is in line with a marketing trend made popular by Apple - and has been common in Android tablets since Samsung's Galaxy tab was released - senior director of teardown services at IHS, Andrew Rassweiler, sees the Nexus 7 pursuing a different direct rival:

"Google's Nexus 7 represents less of an attempt to compete with Apple's market-leading iPad, and more of a bid to battle with Amazon's Kindle Fire," said Rassweiler.

The two platforms are similar in many regards, including the use of the 7-inch display, the eschewing of 4G wireless connections in favor of Wi-Fi, support for virtually identical battery lives and the same pricing for the entry-level models."

A comparison sheet with the Nexus 7 teardown sees major similarities between the two tablets, with Nexus 7 coming out slightly ahead on account of a higher-resolution display and the inclusion of Nvidia's Tegra 3 processor, which makes the Kindle Fire's Texas Instruments OMAP 4430 look suitably aged. The Kindle Fire, however, retails at the same $199 (£128.02) RRP in the US as the 8GB Nexus 7.

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