MacNN | Apple TV selling for razor-thin margins?
MacNN | Apple TV selling for razor-thin margins?
"The Apple TV may be selling near break even or potentially at a loss, according to a new study by iSuppli. A breakdown of the stanard 40GB media hub's component costs suggests that a finished device costs $237 to produce; this leaves just $62, or less than 21 percent, of the selling price to be recouped by Apple. However, the figure is said to omit the necessary marketing costs for the device, suggesting that the actual revenue per device is either slim or may actually incur a slight loss."
I don't know that I buy iSuppli's #s, do they appropriately factor in Apple's bulk discounts? But Steve Jobs said at the D Conference that AppleTV is a hobby, whereas computers, iPods, and soon phones are businesses. Is that a tacit admission that it isn't working out as well as they wanted it to? Or merely that they recognize the market isn't ready to go big with this kind of tech and approach?
