Gizmodo writes: Someone needs to make a good $100 tablet.
I feel that pain, but it’s not going to happen this year. Or necessarily next year.
When you read the reviews of sub-$200 tablets, the biggest complaints are about the tablet being DOA, having difficulty getting one particular thing to run on it, the tablet just overall feeling cheap, or the screen. Better quality control can fix the first two things. But a good-quality capacitive touchscreen costs $63.50. For the tablet to retail for $100, it needs to cost less than $63 to make the whole tablet.
The isuppli teardown of the ill-fated HP Touchpad gives a good idea of just what goes into a tablet.
At the top of the hit parade is the display and the touchscreen, which, combined, tally up $132.50. That’s why cheap tablets have an old-school touchscreen that requires a stylus. As best I can tell, those screens cost under $40.
The Touchpad also had $23 worth of flash memory and $26 worth of DRAM. I don’t think isuppli is right that it contains 8 GB of DRAM. Other sites say 1 GB, which sounds more reasonable. Perhaps those amounts could be halved for a budget tablet to save $24 in manufacturing costs.
The processor is an eye-opener. Twenty lousy bucks gets you a dual core 1.5 GHz Snapdragon? Most budget tablets have CPUs in the 800-900 MHz class. Perhaps those sell for under $10.
Tallying up the rest of the stuff–support chips, enclosure, glass, battery packs–nets another $89.65.
Let’s address the other complaints about cheap tablets.
$30 of what went into the Touchpad is the enclosures. If current $100 tablets feel cheap and flimsy, it’s partly because they’re skimping on the $30 that it costs to make something that feels solid, using more plastic and less metal, thinner plastics, cheaper plastics, and the like.
HP spent $12.50 on chips that do nothing but manage battery power. I’m no EE, and I don’t know the specs on the chips, but my crude analysis suggests a cut-rate manufacturer might be able to eliminate all but the charger chip and the LED driver to cut costs by $10, perhaps more, and just let the unit run the batteries down how it will. That seems a pretty obvious place to cut.
And HP uses $19.40 worth of Li-Polymer batteries. Using older technology, or lower capacity batteries would be another place to cut costs considerably. Some of the cheap tablets use 3200 mAh batteries, nearly half the capacity of the HP.
So, let’s tally up what would have to do into a half-as-good tablet.
charging circuit $2
ui circuit $8
screen driver $11.75
So I get $141.75, total. Figure $10 in manufacturing costs, and you could make a half-as-good tablet for $152.
So while I agree tablet computers are overpriced, making a “really good” $100 tablet seems very difficult in 2011. Cheapening HP’s tablet yields a formula that would get you near or possibly even below $200, and the result probably wouldn’t qualify as “really good” by anyone’s standards.
Subbing in a cheaper screen for the HP Touchpad but leaving the CPU, memory, and battery alone might be good enough for some people. That would drive the cost of manufacturing below $200, but it would have a hard time competing with Amazon’s highly subsidized $249 tablet.
We’ll get to $100 of course. A few short years ago, a $399 laptop seemed impossible, and now we’re well below that.