Tuesday, July 03, 2012

Google Tablet Analysis Points to Thin Margins - Digits - WSJ

WSJ reports on commoditization of hardware in the Android kingdom. This development sets the stage for enterprise adoption of tablets because businesses care more about price/performance than user experience.


The research firm UBM TechInsights has come up with a $184 preliminary estimate for the costs of components in the Google tablet. That compares with its $153 estimate in November for the components inside Amazon.com's identically priced Kindle Fire.

Both Google and Amazon, as has been widely noted, have plans to make money beyond what they take in from the purchase price of their tablets, in Google's case from expected online advertising revenues. Apple, by contrast, gets more from the hardware; UBM puts the cost of components in a Wi-Fi only model of its new iPad at $278, indicating a fatter profit from selling the $499 tablet.

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