Samsungs Galaxy S5 Costs About $256 to Build

Discussion in 'Frontpage news' started by Hilbert Hagedoorn, Apr 18, 2014.

  1. Hilbert Hagedoorn

    Hilbert Hagedoorn Don Vito Corleone Staff Member

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    It is always funky to see what a device initiallyis costing to produce with the knowledge that you know what you pay for in the stores.The Galaxy S5, Samsung’s new flagship smartphone, c...

    Samsungs Galaxy S5 Costs About $256 to Build
     
  2. scoter man1

    scoter man1 Ancient Guru

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    Wow, there's a pretty big profit margin on that.
     
  3. zzzaac

    zzzaac Member

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    You should see Apple's, the iPhone 5 is estimated to be $199

    EDIT: To Be fair though, as stated, it doesn't take into account marketing costs and R+D.

    I feel that smartphones are getting harder to "put something new". So far the new phones (S5, HTC) don't bring anything new to the table.
     
    Last edited: Apr 18, 2014
  4. Tat3

    Tat3 Ancient Guru

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    Working link: http://www.guru3d.com/news_story/samsung’s_galaxy_s5_costs_about_256_to_build.html

    256€ excluding R&D, marketing, costs not directly related to that product like keeping they phone division running and so... Like zzzaac said.

    Still... As long as people find it worth the $600 price tag, it's not too expensive. In the end it's still a company which is trying to make profit and pay to people who have invested in the company.
     

  5. miffywiffy

    miffywiffy Master Guru

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    Why I bought an Xperia Z1 compact, only £360 (barely more than the Nexus 5) and it has all the specs of the £500-600 phones.
     
  6. Jahooba

    Jahooba Member

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    This is pretty much what it comes down to. The cost of individual components is not a good metric for understanding what a phone is worth. Factory retooling, R&D, marketing, paying employees to build it - all of these things chew into that 60% increased sale price. How much they make on each phone is probably marginal, seeing how much smartphone competition is out there.

    Usually a company will take a hit on hardware sales in order to sell their software, which is crazy cheap to copy a few million times and distribute. iTunes alone would keep Apple afloat on billions in profit each year, for example.
     
  7. eclap

    eclap Banned

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    not really. I thought they cost a lot less to make, I'm surprised Samsung isn't selling these for more.
     
  8. Lane

    Lane Ancient Guru

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    And imagine the chinese company out there, who now sell worldwide their 5" high end smartphone..

    you have a 100$ smartphone with the exact same hardware of 600$ ones..

    I dont say the quality is excellent, but this explain too why they are now in the top 5 of smartphones producers..

    Dont forget, in reality they use hardware they are producing, the cost indicate is the price Samsung is selling them to other company, not the price they are really cost them. ( nand, display, even the qualcomm processors are made in their fundries ).. The cost are anyway in other places, fundry, research and developpement of technology process etc.

    Samsung is today the only complete vertical company..
     
    Last edited: Apr 18, 2014
  9. schmidtbag

    schmidtbag Ancient Guru

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    The profit margin on this isn't that high. There's more than just individual parts you have to pay for.

    Also, as long as they have something to offer that (most) others don't, the higher premium is fair.

    I'm not sure about Europe, but in the US you can often get nice phones like this for either (relatively) very cheap or even free, depending on your plan.
     
  10. Denial

    Denial Ancient Guru

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    Well, that phone is definitely being payed for in the cost of the contract. It's the reason why my T-Mobile plan is $70 for unlimited everything but I payed full price for my phone and my sisters Verizon plan is $120 for unlimited talk/text but only 6GB of data, yet she only payed $100 for the "subsidized" LG G2.

    You actually end up paying for more in that model anyway for less service. She payed $100 when it launched for $600 phone but she's paying $50 more a month. Essentially paying off the cost of the phone in 10 months but she signed a 2 year agreement for that cost. Oh and she only gets 6GB of data. So essentially she's paying $700 more to be on verizon with less data. The only advantage is network coverage. In NJ T-Mobile is generally fine everywhere, but go outside and T-Mobile is ****. Whether or not that functionality is worth $700 is up to the consumer I guess, I feel like it's not.
     
    Last edited: Apr 18, 2014

  11. eclap

    eclap Banned

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    where in the article is that said?
     
  12. Brasky

    Brasky Ancient Guru

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    that annoys me, "about 199$" they couldn't round up because 200 looks like such a fantastic number? what am i being sold a value meal?
     
  13. FerCam™

    FerCam™ Master Guru

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    This galaxy must cost 100$ if not less to samsung, the 256$ they are saying is just to make people believe that plus R/D, the selling price is not that high.
     
  14. Denial

    Denial Ancient Guru

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    wut.

    When these type of breakdowns first got posted, literally the exact opposite was said. People were convinced that Samsung was making $400 on each phone. Hell just go read the reddit/r/android thread where this was posted. Almost 90% of the initial posts were people complaining about the cost of smartphones and that Samsung makes too much money.

    Also if you actually had read the entire report (which is behind a paywall unfortunately) they show how they arrived at the total cost with actual sources. As oppose to just pulling a number like "$100 if not less" out of thin air.
     
  15. Dyseman

    Dyseman New Member

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    Yeah, 1000's of Samsung Employees, Utilities, Mortgage/Lease, Advertising, Patent Licensing is all free. No need to charge more than parts cost.

    Geeeeze people
     

  16. ---TK---

    ---TK--- Ancient Guru

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    Don't really care about all that. Just wish I can upgrade more often with a new verizon contract. Currently on the note 2 for a whole year and 12 months more to go. Without paying full price on the phone. Maybe ill be able to jump on the note 4 next year. I'm not paying hundreds of dollars on a new cell phone.
     
  17. schmidtbag

    schmidtbag Ancient Guru

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    oh boo-hoo. Poor thing, having to use an "old" phone for a year.

    Some people really take availability of technology for granted.
     
  18. ---TK---

    ---TK--- Ancient Guru

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    Is that an attempt at a troll post or what? Its generally hard to tell from new members as they are in generally speaking wankers.
     
  19. schmidtbag

    schmidtbag Ancient Guru

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    No, I just think you're being whiney and spoiled - a case of 1st world people problems.
     
  20. ---TK---

    ---TK--- Ancient Guru

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    Yep pegged you right in my previous post. Ill just skim past all your comments from now on. You do not seem to have any info knowledge insight experience etc that I may need anyways.
     

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