3 ms·

> They have a similar (but smaller) advantage in phones, though that is also due to a very large die size as they can afford to spend more per product. Can App

> They have a similar (but smaller) advantage in phones, though that is also due to a very large die size as they can afford to spend more per product. Can Apple afford to spend more per product? There are plenty of other phones in the same price-bracket as the iPhone, and some like the Galaxy S-series phones surely have the volume, to justify a $10–20 increase in SoC cost to get competitive performance. I expect a larger part of it is there's no justification for Qualcomm to develop such a SoC, because it already gets the sales.

drags7er 8y ago
They probably pay less per SoC compared to most Android OEM (except maybe Samsung) since they design the chips in house as opposed to paying Qualcomm.
fipple 8y ago
Yes, because Apple has such a dialed-in phone manufacturing operation their gross margins are much higher than Samsung so they have more wiggle room on the core parts. Most estimates have Apple's gross margins on phones to be 1.5x-2x those of Samsung.
hevi_jos 8y ago
>Can Apple afford to spend more per product? Yeah, Apple has sucked almost all the profit of the Smartphone sector for a long time. It is just one thing: volume. Their volume is so great and prices so high that they get almost all the profit. Their volume also gives them terrible negotiation power with suppliers, they get the best there it is(like electronics), for cheap. The rest of the companies just fight for the spoils. https://appleinsider.com/articles/18/04/17/apple-grabs-86-of-smartphone-profits-globally-iphone-x-alone-seizes-35 https://appleinsider.com/articles/18/04/17/apple-grabs-86-of... Samsung while being the best in the competition, but is is very far from Apple.
- macintux 8y ago
  It's interesting that Apple now sells so many devices they're actually suffering from diseconomies of scale. It's hard to get high quality components produced at large scale in a useful timeframe.
Spooky23 8y ago
Apple’s magic is scaling a small number of SKUs. Dell has like 180 laptop SKUs. Apple has <30.

drags7er 8y ago

They probably pay less per SoC compared to most Android OEM (except maybe Samsung) since they design the chips in house as opposed to paying Qualcomm.

fipple 8y ago

Yes, because Apple has such a dialed-in phone manufacturing operation their gross margins are much higher than Samsung so they have more wiggle room on the core parts. Most estimates have Apple's gross margins on phones to be 1.5x-2x those of Samsung.

hevi_jos 8y ago

>Can Apple afford to spend more per product? Yeah, Apple has sucked almost all the profit of the Smartphone sector for a long time. It is just one thing: volume. Their volume is so great and prices so high that they get almost all the profit. Their volume also gives them terrible negotiation power with suppliers, they get the best there it is(like electronics), for cheap. The rest of the companies just fight for the spoils. https://appleinsider.com/articles/18/04/17/apple-grabs-86-of-smartphone-profits-globally-iphone-x-alone-seizes-35 https://appleinsider.com/articles/18/04/17/apple-grabs-86-of... Samsung while being the best in the competition, but is is very far from Apple.

macintux 8y ago
It's interesting that Apple now sells so many devices they're actually suffering from diseconomies of scale. It's hard to get high quality components produced at large scale in a useful timeframe.

Spooky23 8y ago

Apple’s magic is scaling a small number of SKUs. Dell has like 180 laptop SKUs. Apple has <30.