Nexus One Has a $174 Bill-of-Materials

The folks at IHS iSuppli have wasted no time in ripping apart a Google (Nasdaq: GOOG) Nexus One to put a dollar figure on the cost of materials used to build the phone.

The El Segundo, Calif.-based analysts say that the phone's bill of materials runs $174.15. This total comprises only hardware and component costs for the Nexus One itself and does not take into consideration manufacturing, software, or other costs, such as royalties.

Google sells the phone, made by High Tech Computer Corp. (HTC) (Taiwan: 2498), for $529 unlocked, so that can users can choose which which GSM network to run it on. Otherwise, T-Mobile US Inc. is offering the device on a two-year contract for $179 upfront. (See Nexus One Won't Support AT&T's Fastest 3G Data Services.)

The Qualcomm Inc. (Nasdaq: QCOM) 1GHz Snapdragon processor used in the Nexus One is the most expensive single element of the phone, according to iSuppli, which pegs that component at $30.50.

With the inclusion of the Snapdragon and the associated power-management and RF (radio frequency) transceiver chips, Qualcomm commands 20.4 percent of the Nexus One’s bill, giving it the biggest dollar share of any single supplier, iSuppli contends. This may help explain why Qualcomm CEO Paul Jacobs was so keen to highlight his company's work with Google at his CES keynote last Friday. (See CES 2010: Qualcomm Polishes Chrome.)

iSuppli suggests that the Active-Matrix Organic Light Emitting Diode (AM-OLED) display sported by the phone is the next most expensive item on the list, at an estimated cost of $23.70. The AM-OLED display is supplied by Samsung Mobile Display Co. Ltd., iSuppli notes.

The other uncommon feature on the Nexus One is the unibody construction. A single-piece body tends to "provide greater structural rigidity... On the other hand, a unibody tends to drive up manufacturing costs," the analysts say. This is one feature that Google -- and HTC -- have copied from the Apple Inc. (Nasdaq: AAPL) iPhone.

Overall, the analysts think the Nexus One is "a remarkable feat given the product's BOM is similar to comparable products introduced during the past year." — Dan Jones, Site Editor, Unstrung

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