THE EYE OF THE (BLACK BERRY) STORM
For starters, both devices boast a touch screen, forgoing the buttons found on more conventional phones. But the more important comparison, from the bottom line perspective, lies in which device carries a fatter margin. And on a cost per unit basis, the advantage for the moment appears to belong to Apple (AAPL). A new analysis of the BlackBerry Storm by market research from iSuppli indicates the cost of components and manufacturing for RIM (RIMM) is slightly less than $203. By comparison, those costs for Apple’s iPhone 3G, the second iteration of the device, are less than $175. ISuppli’s estimates factor in only the cost of components and assembly and don’t include estimates for the cost of software, licensing of patents, or distribution. But they do help fill in the blanks on how profitable a device may be.
Though it has yet to disclose official sales data on the Storm, published reports say RIM sold half a million during its first month on the market. In August-September 2007, the first two months the first-generation iPhone was on the market, Apple sold 1.1 million units. Apple quickly ramped up sales and moved more than 2.3 million during the following quarter. RIM declined to comment for this story.
Apple in Hot Pursuit
Rapid-fire sales are bringing the iPhone to within spitting distance of the BlackBerry, which has been on the market for about a decade. During the quarter that ended on Dec. 2, RIM added 2.6 million new accounts and sold 6.7 million devices, bringing the total of subscriber accounts worldwide to 21 million. In its most recent quarter, Apple sold 4.4 million iPhone, bringing its total to more than 17 million.
Verizon Wireless, a joint venture of Verizon Communications (VZ) and Vodafone (VOD), sells the Storm for $249 in the U.S. and then offers a $50 mail-in rebate, reducing the purchase price to $199 for customers who agree to a two-year wireless plan. AT&T (T), Apple’s exclusive partner in the
Storm Suits More Carriers Than iPhone
What helps make the Storm’s? Screen work is a $15 screen overlay device from Synaptic (SYNA), a maker of touch-interface technology that at one time supplied some of the click wheel technology used on Apple’s iPod music players. Andrew Rassweiler, teardown manager at iSuppli, said the device used in the Storm is a first for Synaptic. “It seemed for a while that Synaptic was getting edged out of phones, but now we think we’re going to see more of these in other phones,” he says.
The most expensive component in the Storm is a $35 chip from Qualcomm (QCOM) that may give it an edge over the iPhone. Currently the iPhone only works on so called GSM-GPRS technology based wireless networks, which in the
Buying from Qualcomm is a departure for RIM, which usually uses chips from Marvell (MRVL). While that makes it easier to manage the phone for carriers with different needs, putting one chip in charge of so much can have some drawbacks, Rassweiler says. “You’re burdening one processor with all the important tasks,” he says.
“That can ultimately slow things down when push comes to shove.” The Storm has at least one other advantage over the iPhone: It sports a better camera. Rassweiler says it’s not clear who built the full camera module assembly; he estimates it added about $13 to the cost to build the Storm. But Omni vision (OVTI) supplied the key camera sensor chip. The camera takes pictures at a resolution of 3.2 megapixels vs. the iPhone’s 2 megapixels. It also has an auto-focus feature, which the iPhone camera lacks.
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