Report: Amazon's $359 Kindle 2 costs $185 to make

April 22, 2009 By RACHEL METZ , AP Technology Writer
Kindle 2

(AP) -- If you aren't sure whether Inc.'s latest Kindle electronic reading device is worth its $359 price tag, an analysis by research firm iSuppli may shed some light.

It broke down the device's components and determined that the gadget costs about $185 in parts and manufacturing, or about 52 percent of the total price.

ISuppli estimated that the cost of parts to build the totals $176.83, with $60 going toward an E-Ink Corp. display and $39.50 toward a module from Novatel Wireless Inc. to permit wireless downloads over Corp.'s EV-DO data network.

ISuppli believes that, when including manufacturing and battery costs, the device costs $185.49 to build.

By comparison, iSuppli estimates that Apple Inc.'s 3G costs $174.33 to build. The product sells for $599 or $699, depending on its , when purchased from wireless carrier AT&T Inc. without a service contract. They cost $199 or $299 when purchased with a two-year contract.

Amazon, which began selling the Kindle in late 2007, started shipping the second version of the device in February. The Kindle 2 includes numerous upgrades, such as a skinnier body, the ability to store more books and a screen that can display 16 shades of gray, compared with four shades on the first Kindle.

Amazon has not released Kindle sales figures, but Citi Investment Research analyst Mark Mahaney has estimated that the company sold 500,000 of them in 2008.

©2009 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.

Explore further: Amazon lets authors mute Kindle books read-aloud feature

Related Stories

Discovery sues over Kindle patent

March 17, 2009

(AP) -- Discovery Communications Inc. says the Kindle electronic book readers from Inc. violate a patent that Discovery registered in 2007. Discovery sued Amazon in Delaware on Tuesday.

Sony e-book reader gets 500,000 books from Google

March 19, 2009

(AP) -- Google Inc. is making half a million books, unprotected by copyright, available for free on Sony Corp.'s electronic book-reading device, the companies were set to announce Thursday.

Kindle 2 will no doubt find lots of new fans

April 1, 2009

The Kindle 2, the second version of Amazon's breakthrough electronic book reader, is cheaper ($359), thinner (0.36 inches), can hold more books (more than 1,500 compared with 200), and has a longer battery life (Amazon says ...

Group protests Kindle e-reader's read-aloud limits

April 7, 2009

(AP) -- A group representing the blind and other people with disabilities protested limitations to the new read-aloud feature on Inc.'s latest Kindle electronic reader Tuesday, arguing that the restrictions unfairly ...

Recommended for you

Internet giants race to faster mobile news apps

October 4, 2015

US tech giants are turning to the news in their competition for mobile users, developing new, faster ways to deliver content, but the benefits for struggling media outlets remain unclear.

Radio frequency 'harvesting' tech unveiled in UK

September 30, 2015

An energy harvesting technology that its developers say will be able to turn ambient radio frequency waves into usable electricity to charge low power devices was unveiled in London on Wednesday.

Professors say US has fallen behind on offshore wind power

September 29, 2015

University of Delaware faculty from the College of Earth, Ocean, and Environment (CEOE), the College of Engineering and the Alfred Lerner School of Business and Economics say that the U.S. has fallen behind in offshore wind ...


Adjust slider to filter visible comments by rank

Display comments: newest first

4 / 5 (1) Apr 27, 2009
What about R&D costs? It costs money to design this stuff. Not to mention marketing costs.
not rated yet Apr 27, 2009

Please sign in to add a comment. Registration is free, and takes less than a minute. Read more

Click here to reset your password.
Sign in to get notified via email when new comments are made.