Comments on: Real Kindle cost is $309 – this estimate is closer to reality http://www.teleread.org/2009/04/26/real-kindle-cost-is-309-this-estimate-is-closer-to-reality/ News & views on e-books, libraries, publishing and related topics Sun, 22 Nov 2009 17:56:03 -0500 http://wordpress.org/?v=2.8.4 hourly 1 By: Garson O'Toole http://www.teleread.org/2009/04/26/real-kindle-cost-is-309-this-estimate-is-closer-to-reality/comment-page-1/#comment-1046158 Garson O'Toole Wed, 29 Apr 2009 01:53:40 +0000 http://www.teleread.org/?p=20917#comment-1046158 The New York Times has an interesting article that provides another perspective on the cost of building a device like the Apple iPhone which can be used as an ebook reader. Vendors in China are selling counterfeit Apple, Nokia, Motorola and Samsung phones. The NYT article <a HREF="http://www.nytimes.com/2009/04/28/technology/28cell.html" rel="nofollow">”In China, Knockoff Cellphones Are a Hit”</A> says that even Chinese mobile phone producers are losing market share to underground companies. Many costs are avoided: taxes, regulatory fees, safety checks, design work fees, patent payments and other license fees. <blockquote>The factory production costs for a typical “shanzhai,” or fake cellphone in China run about $40, although very low-end fakes may be made for half that. A typical shanzhai phone sells at retail for $100 to $150. … “I saw iPhone pictures on the Web; it’s so cool. But it costs over $500 — too expensive,” says Yang Guibin, 30, an office worker from Chongqing. “So I decided to buy a shanzhai iPhone. I bought it in a digital market here; it looked exactly like the iPhone.” … Since it is the SIM card that makes a phone run in China, as in most places other than the United States, all you have to do is insert a valid SIM card into a shanzhai phone and it works. … Designs and brand names were copied identically or simply mimicked. (Sumsung for Samsung or Nckia for Nokia.)</blockquote> A sidebar presents a breakdown of the costs of various components in a cellphone. The New York Times has an interesting article that provides another perspective on the cost of building a device like the Apple iPhone which can be used as an ebook reader. Vendors in China are selling counterfeit Apple, Nokia, Motorola and Samsung phones. The NYT article ”In China, Knockoff Cellphones Are a Hit” says that even Chinese mobile phone producers are losing market share to underground companies. Many costs are avoided: taxes, regulatory fees, safety checks, design work fees, patent payments and other license fees.

The factory production costs for a typical “shanzhai,” or fake cellphone in China run about $40, although very low-end fakes may be made for half that. A typical shanzhai phone sells at retail for $100 to $150. … “I saw iPhone pictures on the Web; it’s so cool. But it costs over $500 — too expensive,” says Yang Guibin, 30, an office worker from Chongqing. “So I decided to buy a shanzhai iPhone. I bought it in a digital market here; it looked exactly like the iPhone.” … Since it is the SIM card that makes a phone run in China, as in most places other than the United States, all you have to do is insert a valid SIM card into a shanzhai phone and it works. … Designs and brand names were copied identically or simply mimicked. (Sumsung for Samsung or Nckia for Nokia.)

A sidebar presents a breakdown of the costs of various components in a cellphone.

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