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How much does it cost to build a Kindle 2?

According to iSuppli Corp., only $185.49. The research and analysis firm says it has done a "teardown analysis" of Amazon's popular electronic reader (which retails for $359) and estimates its material and manufacturing costs to be $185.49.

However, materials and manufacturing costs are not all that is involved in creating and pricing the Kindle 2. As iSuppli points out, "Not included in this analysis are costs above and beyond the material manufacturing of the core device itself – i.e., the cost of intellectual property, royalties and licensing fees; those not already included in the per component price – software, software loading and test, shipping, logistics marketing; and other channel costs."

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These are not included, the group adds, because "teardowns cannot reveal this type of information."

You can bet, however, that Amazon's rivals (or potential rivals) are hard at work determining the answer.


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