A teardown of the Samsung Galaxy Tab by iSuppli has revealed the true cost of the device, and it fails to explain why it is priced so high. The combined cost of parts and production of the tablet comes to $214, noticeably less than the cost of just the parts for the iPad which is $264.
Ever since the pricing of the tablet emerged many have said it is too expensive, especially when compared to the equivalent 16GB iPad. The lowest price for the device in the US is currently $400 from T-Mobile, although that's with a $50 mail-in rebate and a two-year contract.
This is compared to a contract-free iPad which would cost $499 for the Wi-Fi only version or $629 for the 3G model.
The lower total cost of components used in the Galaxy Tab is largely thanks to its smaller and lower resolution screen. The seven-inch TFT-LCD screen is the most expensive component at $57, the iPad's larger 9.2" IPS display is estimated to cost $98.
The next most expensive piece of hardware is the memory subsystem at $51 which consists of 16GB of SanDisk Multilevel Cell NAND flash memory as well as a Samsung multi-chip package. The third most expensive cost is represented by the mechanical and electromechanical components which comes to just $15.22.
“While the design approach makes the Galaxy less expensive to produce than the iPad 3G, it also makes for a product that lacks the same usability,” iSuppli's Andrew Rassweiler said.
“The Galaxy Tab's screen resolution, size and technology are not at the same level as the iPad. This is a critical difference, given the fact that the display is a key differentiating factor for the iPad,”
Rassweiler also confirmed that the Galaxy Tab is just an oversized smartphone, with many of the same components as the Galaxy S handsets.
The report mentions how the only real advantage that the Galaxy Tab has over the iPad is its two cameras and Flash support. It also points out that the Galaxy Tab includes a gyroscopic sensor for use in gaming which the iPad doesn't have.
Even though the teardown doesn't include licensing fees, software and royalties, it still makes the device seem overpriced for what it is.
As more tablets emerge with promises of more reasonable pricing and better specs without a contract, things look increasing bleak for the Galaxy Tab, especially with the impending release of the tablet friendly Android 3.0.