iPhone 6s Plus innovations add $16 to component costs

The A9 processor, 3D Touch, upgraded camera, Gorilla Glass 4, strengthened aluminum frame and the new Taptic engine only add $16 to the overall bill of materials (BOM) of the new iPhone 6s Plus compared to the iPhone 6 Plus.

apple iphone 6s plus expanded
IHS

The A9 processor, 3D Touch, upgraded camera, Gorilla Glass 4, strengthened aluminum frame and the new Taptic engine only add $16 to the overall bill of materials (BOM) of the new iPhone 6s Plus compared to the iPhone 6 Plus, claims a new teardown.

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The teardown, carried out by IHS Technology, claims that the BOM for a 16GB iPhone 6s Plus stands at $231.50, with assembly and testing adding another $4.50 to the bottom line. This is $16 more than the iPhone 6 Plus BOM was estimated to be at launch.

"3D Touch and Apple's Taptic engine are among the more notable feature upgrades found in this latest round of iPhones," said Andrew Rassweiler, senior director of cost benchmarking services for IHS Technology. "With each generation the company makes measured, incremental technology improvements to its iPhone line, and this time around those changes are increasing Apple's per-unit material cost."

The bulk of the $16 increase in the BOM is the 3D Touch system.

"The 3D touch system is novel, and when combined with Apple's Taptic Engine, these features add about $10 to the total bill of materials cost," Rassweiler said. "Haptic systems are fairly low-tech and forms of haptic feedback like this have been implemented for years in other devices using traditional vibration motors, but the iPhone's implementation of this feature is unique."

The upgraded front and rear cameras, which are now 5-megapixels and 12-megapixels respectively, drew praise from IHS for being significant upgrades.

"These are major upgrades for the iPhone, which has often lagged behind other leading edge flagship phones, where camera resolution is concerned," Rassweiler commented. "Apple's focus has always been on image quality and camera speed over megapixels, but the iPhone is now on par with its rivals, in this regard."

Another of Apple's innovations - albeit one that benefits Apple more than the consumers - is the way it has streamlined the hardware design so it can manufacture one handset for all markets, this saving money on production costs.

"Apple distinguishes itself by supporting all wireless bands in a single hardware version of the iPhone, which really helps Apple avoid having to manage so many different variations of the iPhone 6S line," Rassweiler said.

Apple's practice of milking cash from consumers who want more than the 16GB base storage model continues with the new iPhones.

"NAND Flash is now so cheap it's almost irrelevant, but Apple monetizes this difference with consumers, to the tune of $100 for each additional step up in memory capacity," Rassweiler said. "For example, a 64 GB iPhone now costs Apple about $17 more to make than a 16 GB iPhone, but Apple charges iPhone buyers $100 more for the increased memory. This is part of Apple's ongoing strategy to improve profits by selling a product mix that is heavier in the higher-end iPhones."

iPhone 6s Plus component costs
IHS

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