When Google’s Nexus 7 was announced last month, everyone was speculating on how much the tablet cost to produce, because let’s face it, at the price that it’s being sold for ($199) it’s almost like they’re giving it away, right? Well, it seems that Google isn’t quite selling the tablet at a loss – TechInsights has done a deep teardown of the device and has estimated the prices of the attached components and have come up with a production cost of $184 for the 8GB model – which is perilously close to the $199 sticker price on the device. $15 isn’t a huge profit margin, though TechInsights have estimated that Google and Asus make more money on the bigger, 16GB version of the tablet, which retails for $249, as it only costs $194 to produce, netting both firms a tidy $55 profit. Of course, the Google isn’t banking on the hardware profits on the Nexus 7 (though we’re sure they wouldn’t mind that one bit). Google is set to make money off of the wundertablet via sales of digital media, from movies, magazines and games which is at the heart of the device.
Source: TechInsights Via Android Community