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Display tech, 4G hikes iPhone 5 cost to $199

The iPhone's cost to Apple is up marginally from the iPhone 4S, with cost increases coming from new display tech, 4G LTE silicon, and Apple's new A6 chip, said IHS iSuppli.

Brooke Crothers Former CNET contributor
Brooke Crothers writes about mobile computer systems, including laptops, tablets, smartphones: how they define the computing experience and the hardware that makes them tick. He has served as an editor at large at CNET News and a contributing reporter to The New York Times' Bits and Technology sections. His interest in things small began when living in Tokyo in a very small apartment for a very long time.
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The iPhone 5's new display, 4G LTE silicon, and A6 chip add cost compared to the iPhone 4S, said iSuppli
The iPhone 5's new display, 4G LTE silicon, and A6 chip add cost compared to the iPhone 4S, said iSuppli. Apple

A preliminary analysis puts the iPhone 5's cost at $199, slightly more than the iPhone 4S.

The virtual teardown by IHS iSuppli puts the bill of materials, or BOM, at $199 for the low-end model with 16GB of NAND flash memory.

After factoring in the $8 manufacturing cost, the cost to produce the phone increases to $207, iSuppli said.

The BOM jumps to $209 for the 32GB version of the phone and $230 for the high-end 64GB version, the market researcher said.

IHS iSuppli

"The iPhone 5's components are expected to be slightly more expensive compared to the iPhone 4S model," Andrew Rassweiler, an iSuppli analyst, said in a statement. The low-end iPhone 4S with 16GB of flash storage carried a BOM of $188, according to a preliminary estimate done by iSuppli in October of last year.

New display tech: The costliest subsystem in the iPhone 5 is estimated to be the display with in-cell touch sensing. "At $44.00, this subsystem is pricier than the combined total of $37.00 for the iPhone 4S display with separate touchscreen based on pricing from October 2011. This is due to the iPhone 5's larger display -- at 4.0 inches diagonally, compared to 3.5 inches for the iPhone 4S -- and the inclusion of the new in-cell touchscreen technology."

4G LTE: The addition of 4G LTE technology is also driving up the cost of the iPhone 5 to $34, compared with about $24 for the iPhone 4S, which was 3G only.

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A6 chip: Another big upgrade of the iPhone 5 is Apple's spanking-new A6 processor. The A6 is estimated to be slightly more expensive, at $17.50, compared with $15 for the A5 in the iPhone 4S.

Flash storage: Flash storage cost is way down, according to iSuppli. The 16GB of flash in the entry-level iPhone 5 is estimated to cost $10.40, down dramatically from $19.20, based on pricing in October 2011, iSuppli said.

"NAND flash continues to come down in price as manufacturing processes for these memory chips become more advanced," Rassweiler said. "And because it is the world's largest buyer of NAND flash, Apple gets preferential pricing. Apple's massive leverage in this market is reflected in our price estimate."

Watch this: iPhone 5: Hands-on at CNET