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146 comments

OhmyGOD yes!!! (-1, Offtopic)

Anonymous Coward | about 2 years ago | (#40627671)

Finally! A first post!!! Jesus, I've been trying to have one for years. =^.^=

Re:OhmyGOD yes!!! (0)

Anonymous Coward | about 2 years ago | (#40627719)

Congratulations on your life's greatest achievement. You can now die happy.

On a side note, I'm not quite sure how they "break even" on a material cost of $151.75 for the 8GB version when selling at $199. To me, that sounds like a profit of $47.25. (Though I'm sure some of that goes to ASUS.)

Re:OhmyGOD yes!!! (5, Informative)

DC2088 (2343764) | about 2 years ago | (#40627743)

Shipping, packaging, advertising, and continued tech support costs are probably factored in.

Re:OhmyGOD yes!!! (1)

DC2088 (2343764) | about 2 years ago | (#40627851)

Scratch shipping.

Re:OhmyGOD yes!!! (1)

Applekid (993327) | about 2 years ago | (#40628041)

All individual parts are rarely made in the same place, so even if they plan to do drop shipping, chances are at some time at some location, something was shipped, and was counted as a cost of production.

Re:OhmyGOD yes!!! (5, Funny)

tobiasly (524456) | about 2 years ago | (#40628149)

Shipping, packaging, advertising, and continued tech support costs are probably factored in.

Hello, 2010 called and they want their distribution model back. This is Google; as soon as the device is assembled by their robot army, Larry Page winks at it while wearing his Google Glasses and a nexus portal opens on your front doorstep (which was previously triangulated to within +/- 0.1m by a Google Street View car) where the tablet materializes.

In rural areas not covered by Street View, a team of Google Glass-wearing skydivers will drop it by.

A CEO's time ain't cheap (neither is airplane fuel) but given how many they can churn out in an hour (and the 99.99% Street View coverage) the extra $47 goes a long way. Of course until the first lawsuit is filed because a tablet materialized through someone's cat.

Re:OhmyGOD yes!!! (1)

Fwipp (1473271) | about 2 years ago | (#40627747)

There are costs besides those of the materials - like assembly, shipping, and storage.

Re:OhmyGOD yes!!! (3, Informative)

ColdWetDog (752185) | about 2 years ago | (#40628057)

You're forgetting hookers and blow.

Re:OhmyGOD yes!!! (5, Funny)

RenderSeven (938535) | about 2 years ago | (#40628367)

Any half-competent CFO knows that hookers and blow is overhead and deductible as an employee incentive under "medical expenses". And as a side note, I've always wondered why non-marring razor blades and plastic straws dont come standard with tablets and their conveniently-sized glass covers? There must be an app for that??

Re:OhmyGOD yes!!! (1)

MonsterTrimble (1205334) | about 2 years ago | (#40628437)

Why is this not +5, Informative?!?

Re:OhmyGOD yes!!! (2)

RenderSeven (938535) | about 2 years ago | (#40628987)

Because the pimps and Colombians dont have mod points, the software guys ran off to write an app for cutting lines on tablets, the vendors are repackaging razors and straws with Apple logos on them, and anyone in marketing is calling backpage.com looking for social media tie-ins. The conspiracy guys think I'm a DEA shill looking phishing for anyone that understood the joke. That doesnt leave many mods left!

Re:OhmyGOD yes!!! (1)

beaverdownunder (1822050) | about 2 years ago | (#40627753)

Er, they kind of have to pay for marketing, etc... a material cost is just... well, materials.

Re:OhmyGOD yes!!! (0)

Anonymous Coward | about 2 years ago | (#40627755)

There are lots of other costs besides the the components. Marketing, R&D, Overhead etc.

Re:OhmyGOD yes!!! (1)

O('_')O_Bush (1162487) | about 2 years ago | (#40627819)

In addition to the other points, if the tablets are being sold through other vendors (BestBuy, newegg) then Google only get wholesale (less than retail).

Re:OhmyGOD yes!!! (1)

Enry (630) | about 2 years ago | (#40627973)

And Google has been offering $25 in Google Play credit.

Re:OhmyGOD yes!!! (4, Interesting)

jellomizer (103300) | about 2 years ago | (#40628029)

Because you don't know anything about Business.

Break Even doesn't equal sum(part) Break Even = Sum(Parts)+(Labor Rate+Benifits)/(Number of units)+(Total R&D costs)/Projected Unit sales+(Facility Costs)...

At $151.75 of parts and selling for 199 actually shows a really good work flow process.

Back during 1990's .COM boom a lot of companies didn't really understand the full cost on how to run a business, The consumers got flooded with a lot of inexpensive stuff (Which seems good) but then the companies shortly went out of business. Leaving us with cheap products that have no future. Or services that we enjoyed that went away, or have quickly gotten very expensive.

Re:OhmyGOD yes!!! (-1)

Anonymous Coward | about 2 years ago | (#40628075)

still, not try to imagine how much profit apple is doing on morons who don't know crap about technology, who buy stuff based on hype instead of feature.

Re:OhmyGOD yes!!! (1)

MonsterTrimble (1205334) | about 2 years ago | (#40628511)

Break Even doesn't equal sum(part) Break Even = Sum(Parts)+(Labor Rate+Benifits)/(Number of units)+(Total R&D costs)/Projected Unit sales+(Facility Costs)...

Just to nitpick (because overall your post is solid): Break even means your selling price equals your costs, which in general means selling price = material + labor + overhead. Facility costs, R&D, shipping, office staff and all of that is generally rolled into overhead.

Doomed competition (4, Interesting)

MightyYar (622222) | about 2 years ago | (#40627737)

Of course this doesn't bode well for competitor tablets. How many Google/Amazon business models are there that can afford to subsidize the tablets?

Re:Doomed competition (2, Informative)

Anonymous Coward | about 2 years ago | (#40627763)

That's the point. Google's not having to subsidize their (Samsung's) tablet.

Not Sumsung. Asus is the fabrication partner. (2)

Picass0 (147474) | about 2 years ago | (#40627831)

FYI

Re:Doomed competition (2)

Nursie (632944) | about 2 years ago | (#40627835)

Why would you say Samsung when the Nexus 7 is made by Asus?

Re:Doomed competition (0)

Anonymous Coward | about 2 years ago | (#40627897)

Uh, because I was wrong. Had Samsung on the mind. Statement stands, different manufac. partner notwithstanding.

Re:Doomed competition (1)

Anonymous Coward | about 2 years ago | (#40627787)

Amazon new this going in (obviously) which was why they were willing to do it. They expected no real competition at the low end price point. I imagine they surveyed who their competitors could be and saw that none of the hardware makers stood a chance. They probably figured Google didn't want to get into the market again after their earlier forays into direct sales and lack of any perceptible support didn't go so well. But you are right - there really isn't anyone else that can make up the lack of profit on the initial sale with tie in sales in their own markets / stores.

Re:Doomed competition (4, Informative)

gl4ss (559668) | about 2 years ago | (#40627893)

I'd take the bill of material analytics with a grain of gunpowder and salt. and anything iSuppli says anyways.
neither amazon or asus is paying list pricing for components and iSuppli doesn't know amazons or asus manufacturing expenses. furthermore they have no idea when each company bought the parts they bought.

what they work as is a list of chips inside both devices.

Re:Doomed competition (0)

Anonymous Coward | about 2 years ago | (#40628015)

This is exactly what I say every time. The "parts cost" from this website is just this side of a wild-ass guess and certainly has more than an $18 margin of error.

Re:Doomed competition (2)

pepty (1976012) | about 2 years ago | (#40629207)

They expected no real competition at the low end price point.

That may not be relevant. Amazon's business model for the previous kindles was to use it to get people to buy more stuff from Amazon and to collect usage records for marketing analysis. I have to think that's one reason they've been so generous about replacing broken kindles: working kindles keep generating revenue, broken ones don't. Even though the Fire and its competitors will be acccessing a much smaller percentage of their content from Amazon than previous kindles, Amazon's vertical (close enough)monopoly will still turn a profit on each Fire that's initially sold at a loss.

Re:Doomed competition (2)

synapse7 (1075571) | about 2 years ago | (#40627807)

Unless they are giving it away for nothing, I'll still be buying a tablet with an SD slot of some type.

Re:Doomed competition (1)

GodInHell (258915) | about 2 years ago | (#40627939)

Why the obsession with physical media?

Both the Kindle and Nexus 7 assumes that you are consuming media from the net.

Re:Doomed competition (4, Informative)

Andy Dodd (701) | about 2 years ago | (#40627965)

Because you often use a tablet like this in places (buses, trains, planes, cars you are not behind the wheel of) where there is no network connection.

Even for those situations listed above where you could tether to a smartphone, extremely low data caps (you'd kill your data allowance on most carriers with a single 720p movie for example) mean that cloud storage of video is nowhere near ready for mobile devices, and even cloud storage of music is a bad idea. (Streaming music frequently is a good way to hit your data cap.)

Re:Doomed competition (4, Insightful)

TheGratefulNet (143330) | about 2 years ago | (#40628285)

its refreshing to hear from the side that realizes 'the net' is not everywhere and always on at all times.

younger developers are too spoiled and assume too many things when they design things.

I don't have a 'data plan' and until they are affordable, I won't pay for one. if I'm out and about, its *not* assumed I'll have any kind of data connection. local storage always always works - WAN networks, well, not so much.

Re:Doomed competition (0)

DC2088 (2343764) | about 2 years ago | (#40629365)

Hello 2005

Re:Doomed competition (0)

Anonymous Coward | about 2 years ago | (#40630151)

Ah yes 2005, when you could still get unlimited Internet.

AC

Re:Doomed competition (1)

Mike Buddha (10734) | about 2 years ago | (#40630299)

Ah yes 2005, when you could still get unlimited Internet.

...at 128kbps.

Re:Doomed competition (1)

Black LED (1957016) | about 2 years ago | (#40630407)

Where? Podunk? I had 500kbps cable modem internet access back in '98 when I lived in the Bay Area.

Re:Doomed competition (1)

Black LED (1957016) | about 2 years ago | (#40630427)

That should read 500KBps (kilobytes per second, not kilobits).

Re:Doomed competition (4, Insightful)

Anonymous Coward | about 2 years ago | (#40628661)

Because you often use a tablet like this in places (buses, trains, planes, cars you are not behind the wheel of) where there is no network connection.

I just checked my (wifi-only, 16GB) iPad (with about 3 GB free on it at present). I have ~24 hours of music and podcasts (~4 GB), 6 hours of tv shows (~3 GB), an iOS programming course (~3 GB), 142 Books (in the Kindle app), and 8 games on it (~2 GB). None of them require a single bit of over-the-air data, because everything is synced to my ipad's internal storage. And if there's something I REALLY REALLY WANT, I have never been UNABLE to wait a few hours until a wifi signal is available, and download it then, onto the ~3GB of internal storage *still left* on the model of iPad with the *smallest* internal storage that they sell.

Could you explain to us exactly what sort of bus ride, train ride, plane ride, or car ride you're taking that would legitimately require MORE internal storage than that?

Or are you REALLY so disorganized that you can't manage to keep a few "current, interested in listening/watching/reading/playing these things" items on your tablet to keep you busy for 5-6 hours on a trip? And if you are... how exactly does an SD slot fix that problem? You'll just end up with a fucking empty SD slot which you forgot to load shit on for your long bus/plane ride, too.

Can this myth of "without removable storage your tablet is worthless" finally fucking die? PLEASE?

Re:Doomed competition (2)

Black LED (1957016) | about 2 years ago | (#40628979)

You miss the point. It's not about needing all of that stuff in a single trip, it's about having specific things available when you want them and not having to constantly juggle data back and forth between the tablet and a PC or internet.

For me, 16GB (more like 12-14GB user accessible) would barely hold two HD movies, at about 5-6GB each. My music library takes up over 120GB and the average "AAA" mobile game is 1-2GB now. A 16GB storage limit doesn't offer a lot of on-the-fly selection.

Re:Doomed competition (0)

Anonymous Coward | about 2 years ago | (#40630323)

I have a couple memory cards that I swap out depending on what I will be doing. Popping a card in and out is a hell of a lot faster and easier than swapping a whole bunch of stuff back and forth.

You feel the way you do because you don't know what you're missing. Sometimes happens to zealots... also morons.

6 hours ? (0)

Anonymous Coward | about 2 years ago | (#40630399)

On e.g. flight that lasts 11 hours ? I would like a little bit more than that, and a choice in what I want to watch... 16GB is nothing: I normally take a 40GB HDD and 2 32GB SD cards with me in my TF101 Transformer tablet package.

Re:Doomed competition (0)

Anonymous Coward | about 2 years ago | (#40629029)

I was figuring something like MyFi would be a good option for these things. Gotta look for one with a pay as you go kind of plan if they'd do that.

Re:Doomed competition (1)

dAzED1 (33635) | about 2 years ago | (#40629679)

time management? Planning for those trips to abandoned underground bomb shelters that can't get signals, and thus putting the stuff on your device before you go, instead of relying upon a bunch of external physical media? I used to love my floppies too back in the day, but they make a little pill for that now in this century...

Re:Doomed competition (0)

Anonymous Coward | about 2 years ago | (#40629849)

You may enjoy wasting hours trying to anticipate what you'll want to bring, then picking and choosing the exact content that you can fit into 16GB of space but I'd rather just have all of my stuff always available and ready to go. In addition, unless you like to go on trips to or camping outside of your local Starbuck's, good luck finding a wifi connection.

Re:Doomed competition (1)

synaptik (125) | about 2 years ago | (#40630147)

What is the difference between these two outcomes:
1. Realizing you will later be on a bus/train/plane/car/deserted island with no connectivity, and preloading your sd card with content to consume during your adventure
2. Realizing you will later be on a bus/train/plane/car/deserted island with no connectivity, and preloading your device with content to consume during your adventure

?

Or, are you bemoaning the loss of opportunity to swap pre-loaded sd cards with your fellow travellers/castaways? Because if so, you could just do one of the following:

a. Trade devices for a while
b. Swap the files via NFC or bluetooth

Re:Doomed competition (1)

Black LED (1957016) | about 2 years ago | (#40630201)

The difference is with a large enough SD card, you don't have to custom tailor what you have on it. You just throw it all on there and leave it be so it's ready all of the time.

Re:Doomed competition (1)

larry bagina (561269) | about 2 years ago | (#40630411)

Assuming I'm on a deserted isle and assuming I get to pick my fellow castaways, I'd be too busy fucking to worry about SD cards.

Re:Doomed competition (2)

Chrisq (894406) | about 2 years ago | (#40627997)

Why the obsession with physical media? Both the Kindle and Nexus 7 assumes that you are consuming media from the net.

He wants his pron collection to be quickly disposable.

Re:Doomed competition (0)

Anonymous Coward | about 2 years ago | (#40628097)

Mostly because you have less reason to password protect the measley 5GB of data you are publishing to the rest of the world, who will steal it, misuse it or lose it.
My angry birds high score list is sensitive info.

Re:Doomed competition (2)

BradleyUffner (103496) | about 2 years ago | (#40628319)

Why the obsession with physical media?

Both the Kindle and Nexus 7 assumes that you are consuming media from the net.

Because when my phone / tablet dies I would still like to be able to get the data off of it by removing the memory card. This also makes swapping devices trivial because you can just move your memory card around.

Re:Doomed competition (1)

swillden (191260) | about 2 years ago | (#40628561)

Why the obsession with physical media?

Both the Kindle and Nexus 7 assumes that you are consuming media from the net.

Because when my phone / tablet dies I would still like to be able to get the data off of it by removing the memory card. This also makes swapping devices trivial because you can just move your memory card around.

For music (which is the biggest consumer of storage on my devices), just upload it all to Google Music. Then when you switch devices just let it download onto your new device over Wifi (which it will do automatically in the background, whenever you have Internet). The download isn't as fast as just moving an SD card, of course, but it also means that your music can easily be on multiple devices at once, and you don't have to worry about losing your SD card.

Re:Doomed competition (0)

Anonymous Coward | about 2 years ago | (#40628881)

Why does the data only exist on your tablet device in the first place?

Also, be more careful and avoid destroying your $200 tablet constantly, and this ceases to be a pressing concern.

Just Wow! Too Much Cloud Kool-Aid. (2)

luis_a_espinal (1810296) | about 2 years ago | (#40628743)

Why the obsession with physical media? Both the Kindle and Nexus 7 assumes that you are consuming media from the net.

Jesus's clone riding a genetically resurrected dinosaur in the name of logistics, man. Are you aware that net access is not omnipresent, and despite the media/geek-wannabe hype, it will not be for years to come? It might be omnipresent in our cubicles and wired dwellings, but once we step into the sunlight (${DEITY:-FSM} knows some of us do), we don't even get a guarantee of cell phone signal everywhere.

Do you think wifi fares better?

Let's forget the hyperbole for a second. You want to have access to your media anywhere. When you are a car passenger. On a train. On an airplane. When you are camping, or at the beach. To read your books or play videos to entertain/control/mind-numb-into-submission your toddlers. That's why you need permanent storage.

It is one of the reasons I've been hesitant to buy the Kindle Fire or similar devices without a micro-sd port. I do frequent trips (mostly to Japan), and I want to have access to my media (for the same reasons outlined above) when having a 16+ hour flight coupled with 2+ hours in the train upon arrival (or when I'm in a train between cities.) I can't do that unless I purchase a WIFI receiver (typically with a monthly subscription). That's a situation that repeats itself when traveling overseas (or even when traveling within the country).

So physical media matters for practical reasons. It is unpractical for Amazon and Google to presuppose users will have access to the net anytime anywhere. There is a reason why tablets and netbooks either have a usb/micro sd port, or manufactures like Apple and Samsung provide usb/micro sd adapters for their devices.

Lay the infrastructure that makes this possible first, and then we talk about replacing physical media with oooooooooo the cloud. This should be an obvious thing for the ./ geekterati. Don't know why it is not.

Re:Just Wow! Too Much Cloud Kool-Aid. (-1)

Anonymous Coward | about 2 years ago | (#40629125)

When you are camping, or at the beach

Wow, just wow. I have a better solution to your problem:

Pop the good Lady Media Consumption's tit out of your mouth now and then and disconnect. Staring blankly at a screen with a slack jaw while you do EVERYTHING is unhealthy. Learn to enjoy the places and moments you're living in, rather than needing to be staring at a high-def video constantly, or pacifying your children using the same technique.

8 GB storage is more than enough for any conceivable amount of reading you're going to do on a trip that's shorter than a few months. You can fit days worth of music into 8 GB. Your supposed use cases are so unlikely, or so esoteric, that they can be safely ignored as a primary driver in the purchasing decision for these products.

Re:Just Wow! Too Much Cloud Kool-Aid. (1)

Jeremy Erwin (2054) | about 2 years ago | (#40629987)

> 8 GB storage is more than enough for any conceivable amount of reading you're going to do on a trip that's shorter than a few months.

Wouldn't you want to have your entire library with you, so that you can cross reference, scan through, or reread your favorite novels when the mood strikes you?

> Your supposed use cases are so unlikely, or so esoteric, that they can be safely ignored as a primary driver in the purchasing decision for these products.

That explains things. You're an alien. "Use cases." "Primary driver in the purchasing decision". What about "the serendipity of reading?"

Re:Doomed competition (1)

Black LED (1957016) | about 2 years ago | (#40628857)

I nearly pre-ordered one until I noticed it was lacking an SD slot. I would happily pay an extra $50 for a model with one instead of for the 16GB model. Unless/until they offer that, no sale.

Re:Doomed competition (0)

Anonymous Coward | about 2 years ago | (#40630479)

Unless they are giving it away for nothing, I'll still be buying a tablet with an SD slot of some type.

Probably not what you're looking for, but I wonder if a USB key (with adapter) would work on the Nexus' USB port? Not quite as nice since it would be hanging out of the thing, but it would be removable storage. :/

I don't know why they don't just put on on there either, especially since the Nexus tops at a measely 16GB. Fortunately for what I use a tablet for, I would almost always have WiFi access.

Re:Doomed competition (1)

Tough Love (215404) | about 2 years ago | (#40629463)

Of course this doesn't bode well for competitor tablets. How many Google/Amazon business models are there that can afford to subsidize the tablets?

Au contraire. The only competitor netpad this displaces is Amazon's, and only the currently shipping version. Google's tablet accomplishes two things: 1) together with Amazon's to-be-discounted Fire and Fire's successor, this will establish Android as the netpad leader and thus bring in the developers (developers, developers!) 2) it establishes a minimimum hardware spec for the $200 netpad segment.

Frankly, Moore's law says that in six months this hardware doesn't need subsidizing. At that point Google's hardware partners will entry (Amazon isn't one) and Google will step back.

Re:Doomed competition (1)

MightyYar (622222) | about 2 years ago | (#40629661)

Frankly, Moore's law says that in six months this hardware doesn't need subsidizing. At that point Google's hardware partners will entry (Amazon isn't one) and Google will step back.

Why wouldn't they come out with a better unit at the same price point?

Re:Doomed competition (1)

Tough Love (215404) | about 2 years ago | (#40630381)

Frankly, Moore's law says that in six months this hardware doesn't need subsidizing. At that point Google's hardware partners will entry (Amazon isn't one) and Google will step back.

Why wouldn't they come out with a better unit at the same price point?

They would only do that if their partners need another kick in terms of specs. Which is unlikely. Remember, Google's business is selling ads, not hardware. Google is only selling hardware at the moment to prevent Apple from setting up toll booths around the netpad segment. The big downside of Goolge refreshing its product at the 7 inch form factor is, what a great way to scare off hardware partners. IMHO Google will instead introduce a 10 or 11 inch netpad, extending Android firmly into that space, then get out entirely after that takes hold. Well, it's entertainment now, just sit back with popcorn.

Re:Doomed competition (3, Insightful)

symbolset (646467) | about 2 years ago | (#40630219)

These tablets have limited time to establish dominant mindshare. If Google subsidized each tablet $10 for 100 million tablets a year, that would be the$1B/yr level Microsoft is subsidizing Nokia. This isn't business any more, except to the extent that as always - business is war. The goal here is to kill the PC outright before Microsoft achieves their avowed goal of killing Google.

Stick, razor (5, Insightful)

Anonymous Coward | about 2 years ago | (#40627777)

This makes sense.
Andriod is really a platform for Google to sell their services (or promote ad based ones). It's not surprising they'll sell an at-cost device. They're also really nice machines, and set the bar for what a "low cost" device should really have. Fast quad core, latest OS, plenty of ram, access to google play(store). Great way to bump inferior devices off the market that would degrade user experience and cost them service revenue.

Even the small storage and lack of sd card is a "feature". - It provides a place to differentiate other tablet makers, who can add a card slot and more storage and charge a price premium over the nexus. (Well, that and the low storage encourages users to get their data from google online services rather than store it locally)

I recently picked up a galaxy tab 2 7.0 (Before google announced their offerings). Great little device. I love it, but clearly inferior to the new google equivalent. Sorta wished I waited.

Re:Stick, razor (4, Interesting)

ifiwereasculptor (1870574) | about 2 years ago | (#40627813)

This makes sense.
Andriod is really a platform for Google to sell their services (or promote ad based ones). It's not surprising they'll sell an at-cost device. They're also really nice machines, and set the bar for what a "low cost" device should really have.

Very true. I wish they also did something similar with phones. Right now Android is perceived by a lot of people as kind of crappy because the phones they buy are kind of crappy. Maybe Google realized that the lower end is a better place to insert the Nexus reference and kill bad products by offering better alternatives.

Cheap Google phone doesn't make sense (1)

k(wi)r(kipedia) (2648849) | about 2 years ago | (#40627919)

Very true. I wish they also did something similar with phones. Right now Android is perceived by a lot of people as kind of crappy because the phones they buy are kind of crappy.

In some countries Samsung is already selling Android (2.2) phones not much more expensive than an feature phone. So I doubt anybody can sell any cheaper that and still get some measure of quality. And I doubt that Google would be interested in selling cheap smartphones since that segment is already well taken care of by the cellphone service providers (via smoke-and-mirrors subscription plans).

Re:Stick, razor (1)

GodInHell (258915) | about 2 years ago | (#40627961)

Except that the best deal will probably still be whatever tablet goes on clearance.

Re:Stick, razor (1)

Andy Dodd (701) | about 2 years ago | (#40627989)

They are doing this with the Galaxy Nexus - yes it's more expensive because sticking an extra radio into a smaller device will drive costs, but still - $350 for an unsubsidized flagship smartphone is dirt cheap compared to the rest of the industry.

Re:Stick, razor (1, Informative)

GodInHell (258915) | about 2 years ago | (#40627945)

Andriod is really a platform for Google to sell their services (or promote ad based ones). It's not surprising they'll sell an at-cost device.

/cough/ This isn't actually a Google product -- ASUS producing and selling the device, it's just google branded. (See also, *Samsung* Galaxy Nexus).

Re:Stick, razor (2, Insightful)

Anonymous Coward | about 2 years ago | (#40628035)

That sound you heard was the point of this conversation flying over your head. (And whoever modded you up)

Yes, Asus makes it.. But it's clearly a google product. That's how google is promoting it in every shred of marketing material I've seen.. The at-cost price would not make any sense whatsoever for Asus because they don't run the revenue generating end-user services. Google does.

Re:Stick, razor (1)

GodInHell (258915) | about 2 years ago | (#40629587)

Yes, Asus makes it.. But it's clearly a google product.

That would imply that the profits from the sale are Google's - which isn't actually the case. Google isn't hiring ASUS to build these and distribute them at cost, Google partnered with ASUS to produce an officially branded tablet. The Nexus 7 is the new flagship Android tablet -- but it's not their product.

Re:Stick, razor (1)

Anonymous Coward | about 2 years ago | (#40629705)

$200 was the price point I fully expected the original iPad to debut at. There was absolutely no conceivable use case (to me) that would make it worth more than what I'd spend for, say, a video game console -- the thing is a toy/consumption device.

When the iPad's price was announced, I figured it would flop. I guess I greatly underestimated people's willingness to pay for yet another way to put an insipid glowing rectangle in front of their faces for more hours of the day. I do tend to give people too much credit at times.

costs (1)

Muramas95 (2459776) | about 2 years ago | (#40627789)

Is this taking in consideration of bulk part order?

Re:costs (1)

alexander_686 (957440) | about 2 years ago | (#40627907)

Kind of. Nobody knows what bulk cost is. The devices often have custom pieces. Big contracts for standardized items are almost always individually negotiated. So the piece quotes on these are always based on rules of thumb – which assumes some discount for large orders.

snarkiness (1)

drinkypoo (153816) | about 2 years ago | (#40627793)

I'm pretty sure that these devices have more than 1 and 2MB of storage. I don't expect editors to edit or anything, but are nerds seriously still having problems with the idea that the abbreviations for units are case-sensitive? K is not k and b is not B and so on?

Re:snarkiness (0)

Anonymous Coward | about 2 years ago | (#40627839)

I'm pretty sure that these devices have more than 1 and 2MB of storage.[...] K is not k and b is not B and so on

And G is not M ?

Re:snarkiness (1)

drinkypoo (153816) | about 2 years ago | (#40628973)

Er, yeah. That's what I get for being an asshole, I guess. Irony FTL.

Re:snarkiness (0)

Anonymous Coward | about 2 years ago | (#40627863)

But certainly G is not M. 8Gb is still equal to 1GB not 1MB

Re:snarkiness (4, Funny)

CanHasDIY (1672858) | about 2 years ago | (#40628111)

I'm pretty sure that these devices have more than 1 and 2MB of storage. I don't expect editors to edit or anything, but are nerds seriously still having problems with the idea that the abbreviations for units are case-sensitive? K is not k and b is not B and so on?

Dude, I have had people (I assume they're people, then again this is /.) argue with me about whether or not it's proper to capitalize the letter i when using it in self-reference (i.e., "I'm not so dumb as to think I don't need to capitalize i when I self-reference"). Same goes for capitalizing the first letter of a sentence, and proper nouns. The way some folks bitch about having their capitalization corrected, you would think the Shift key killed their family and raped their dog...

Keeping that in mind, are you really all that surprised?

In what quantity? (4, Insightful)

cdrguru (88047) | about 2 years ago | (#40627849)

What quantity is this costing based on? Something tells me that Samsung gets different prices that some Joe on the street, especially when buying something in millions of units at a time. Sure, a processor chip might cost $50 if you buy one and $10 if you buy 1000. What happens when Samsung buys a million of them, which could be the entire output of the manufacturer for several months? At those quantities you also have fun things like the buyer demanding that they get the right to go to other fabs so they can get the quantity they need - they essentially license the rights to produce the chip themselves.

Of course, it is then a short hop down the road to the manufacturer simply being added to the stable of companies owned by Samsung. Or not quite owned but invested in such that the manufacturer can produce the quantities that Samsung desires.

Such cost estimates are garbage because Samsung isn't talking about what they are really paying for parts. So all you have is guesswork based on public information. I would offer that neither Amazon nor Samsung is paying the sort of prices that are publicly available and special deals are being cut in exchange for who-knows-what.

In electronics there are three quantity levels that count: one, 1000 and the entire output of the manufacturer for months. When you scale up to the last one, the buyer gets to dictate what the price is going to be and the seller is pretty much at the mercy of the buyer.

Re:In what quantity? (2)

fast turtle (1118037) | about 2 years ago | (#40627959)

In order to get an Apple to Apple comparison point, they probably look at the cost per thousand. This at least allows them to provide some kind of estimate that compares across multiple brands when they use the same/similar parts

Of course it is by no means an accurate comparison for the reasons you stated - There's a lot of difference between Google and Samsung in quantities purchased though the comparison is far more close between Amazon and Google based on initial quantities manufactured

Re:In what quantity? (2)

devitto (230479) | about 2 years ago | (#40627975)

Yeah, you really need to understand electronic manufacturing.
You don't really get massive mark-downs for volume - maybe 70% difference from 1 to 1 million.
It's like kit-cars, they are not 1000 times the price of a comparible Ford, even though Ford make a 100 million more that you do.

Hence being able to price up the hardware in these teardowns. Yeah, maybe they are 10% out, but they're not 30% out, and both teardowns will be wrong by the same degree...

Re:In what quantity? (5, Informative)

jrumney (197329) | about 2 years ago | (#40628425)

You don't really get massive mark-downs for volume - maybe 70% difference from 1 to 1 million.

I don't know which branch of electronic manufacturing you're talking about, but the one I'm familiar with has a MASSIVE per unit cost difference between buying one off components and buying them by the reel, and another big cost drop once your volume becomes high enough that the component manufacturer will deal with you direct instead of having to go through a distributor.

Re:In what quantity? (1)

Pax681 (1002592) | about 2 years ago | (#40628071)

erm.... always with "samsung" .. THE PARTNER FOR THESE IS ASUS...... NOT SAMSUNG" ...
i am far from the first person to point this out here

Re:In what quantity? (0)

Anonymous Coward | about 2 years ago | (#40628139)

Mmm-hmm, because there's nobody that ever thought of that before. Nobody else in the history of civilization has ever worked on a high volume consumer electronics product ever and have done these volume purchase deals and would be able to give good estimates. There are no engineers anywhere who have any idea what the BOM to make these individual components are or could extrapolate from the base quoted $/M price and what a large volume purchaser would get. And even if somehow these mythical experts existed, professional analysts like iSuppli would never ever think to hire them.

Sit down and shut up.

Re:In what quantity? (0)

Anonymous Coward | about 2 years ago | (#40628243)

Standard 'rule of thumb' is whatever it costs you to build 2x that and you will 'do ok'.

In econ terms it is MR=MC. But you do not exactly have perfect view of what demand looks like (unless you are a monopoly/oligopoly).

I suspect the reason we are not seeing a more profound secondary market to the ipad is not because of crummy hardware/software or anything like that. I suspect it is because of a lack of some key parts. And 1-2 players are buying up those parts. The same sort of thing happened in the atari 2600 era. They would buy up entire runs of parts that could be made into another console just to keep the manufacture busy and deny competitors the chance to buy them. They would then toss out the parts quietly, or just not take delivery, or change the specification...

Re:In what quantity? (1)

MonsterTrimble (1205334) | about 2 years ago | (#40628617)

When you scale up to the last one, the buyer gets to dictate what the price is going to be and the seller is pretty much at the mercy of the buyer.

Almost. When you get to the last one you get really the best price possible but it's not like you can get a billion processors for a penny each. There is always a limit and there is always the option to walk away. It's often hard, but if you're going to lose money on a piece of business, you're generally not going to do it unless there is something else at play.

Apple & Amazon have own retail channels (1)

peter303 (12292) | about 2 years ago | (#40627963)

Google will have to pay its retailers about 20% retail markup and definitely lose on each sale. Apple and Amazon wont have to pay the retail markup.

Re:Apple & Amazon have own retail channels (1)

alen (225700) | about 2 years ago | (#40628047)

not like apple stores are free to run
they still have to pay credit card fees, rent, salaries, etc

Re:Apple & Amazon have own retail channels (1)

aardwolf64 (160070) | about 2 years ago | (#40629043)

Google pays a fee on every device they sell, cutting into their profit the same regardless of the quantity purchased.

Apple/Amazon have fixed costs for the stores, etc. Selling additional units lowers the per unit cost attributed to the store, etc... So greater quantity quickly increases the profit margin.

Re:Apple & Amazon have own retail channels (0)

Anonymous Coward | about 2 years ago | (#40628345)

FWIW, I'm a technology buyer for a retail channel and hardware markup is about 5% which will come to about $190 give or take.

Price a little higher than originally estimated (0)

Anonymous Coward | about 2 years ago | (#40627981)

I got a pre-order email that quoted a price of $249, $50 more than the pundits were estimating. That dampened my enthusiasm just a tad, might wait for Kindle Fire 2.

Re:Price a little higher than originally estimated (2, Informative)

Anonymous Coward | about 2 years ago | (#40628135)

The 8GB unit is $199 and the 16GB unit is $249. I guess you just misread somwhere and presumed the 16GB version would be $199.

It's nice that the UK versions are priced at £159 and £199 respectively instead of the direct replacement of the US dollar sign for a UK pound sign that some manufacturers have historically done.

Re:Price a little higher than originally estimated (1)

Mike Buddha (10734) | about 2 years ago | (#40630355)

The price has alway been $199 for the 8Gb and $249 for the 16Gb from the day they were announced at Google IO.

Amazon & Apple make 30% on Media/App sales (1)

peter303 (12292) | about 2 years ago | (#40627991)

The make 30% of each book, movie, song, and app sold. So Amazon can essentially give its tablets away at cost and still make lots of money. I wonder if GooglePlay has similar profitability.

Re:Amazon & Apple make 30% on Media/App sales (1)

ZombieBraintrust (1685608) | about 2 years ago | (#40628067)

Amazon looses money on many of its book sales as well. They sell new releases for $9.99 below the wholesale price. Many of their app sales are also discounted.

Re:Amazon & Apple make 30% on Media/App sales (1)

paulpach (798828) | about 2 years ago | (#40629019)

My game [amazon.com] made it to top 25 in the first month. I can tell you from experience that this model is a win for everyone involved:
  1. 1) Kindle fire users get a tablet at very low cost, with tons of apps available
  2. 2) Amazon makes 30% of all the sales, which are substantial.
  3. 3) We (developers) don't have to worry about distribution, refunds, credit cards, or anything like that. We do what we are good at: make a game.
  4. 4) We (developers) are exposed to tons of users that bought the cheap tablet

I can only hope more companies do the same.

NOt so surprising (1)

blind biker (1066130) | about 2 years ago | (#40628505)

According to some reviews, the Nexus 7 is the fastest Android tablet to date. Add the retina display, and you got yourself an expensive little piece of kit.

Clearly EVUL! (-1)

Anonymous Coward | about 2 years ago | (#40628557)

HOLY SHITTING DICKNIPPLES!!!1! This clearly PROVES Google is teh EVULZ! See how evil they are? SEE? ISN'T IT OBVIOUS? I certainly can't explain... er, I mean don't NEED to explain it to you, but I'm certain someone will be by shortly to explain in detail just how EEEEEEEVIL this is, complete with snarky references to Google's motto of "do no evil"*! It'll be so clever!

*: Despite the fact it's actually "don't be evil", but that's just too inconvenient a phrase for the smart kids with too much snark on their hands.

Volume discount? (1)

sjbe (173966) | about 2 years ago | (#40628651)

The problem with most of these sorts of analysis is that they have no real way to know what sort of volume discounts Google or Amazon are getting. You can ask what the prices are but when you start getting into millions of units that usually takes more than a phone call. Pricing on electronics components is strongly a function of volume. (I know because I buy them daily in my day job) Spot market rates aren't usually the same as contract rates either and for the sorts of volumes Google would deal in we're probably talking contract rates.

In short, they may have made some assumptions about volume discounts but unless they have inside information they cannot possibly actually know what Google is paying.

Where's my Nexus 7? (1)

hendridm (302246) | about 2 years ago | (#40630115)

Apparently, to Google, "pre-order" means you're the last person to get one. They're supposed to hit retail stores today and they're already on eBay. Meanwhile, I check my "Google Wallet" account and it just says that Google "received my order" since June 28th. No updates, no shipping information, no reply to my e-mail, nothing.

The very least they could do is provide some damn communication on why they're shitting on their pre-order customers.

If the Nexus 10 ever becomes a reality, don't "pre-order" it! You'll get it sooner from Gamestop apparently. Fuckers!

Maybe that's why it doesn't have HDMI? (1)

Galestar (1473827) | about 2 years ago | (#40630277)

And why I will never buy one
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