iPod Shuffle Costs $22 to Produce

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iPod Shuffle Costs $22 to Produce
April 14, 2009

" Apple's new iPod Shuffle has had a bit of controversy, ranging from its lack of physical buttons, restricted headphones, to the sheer (lack of) size of the device. This, certainly, isn't going to provide any good free advertising either. According to BusinessWeek, the latest iteration of Apple's smallest iPod only costs a mere $22 to create, but how much does it retail for? $79.

That's right, you're being charged almost an extra $60 to own one of these tiny creations, which to some people is an amount that is unacceptable. The main application chip of the Shuffle, which runs music controlling and other functions, is worth $5.98. To quote iSuppli analyst Andrew Rassweiler, "It's almost like six dollars worth of flash memory tied to some flash and a battery and not much else. It's very basic and downsized." As the BusinessWeek article states, "All told, the cost of the shuffle's components, the headphones, and the packaging it ships in comes to $21.77, according to iSuppli's estimates."

This suggests that, as many people assume, if the markup on this is that high, then others will be the same. For example, for the first iPod touch, manufacturing costs were $147 whereas retail prices were $299.

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:source: Source: Latest iPod Shuffle only costs $22 to manufacture

1) Build your own
2) ???
3) Profit!!!!!

People really can't be surprised by this.

Where do you expect Apple profit come from?

It's pretty simple... you either decide that $79 for an iPod Shuffle is a better choice than a competing model or building your own, and buy it, or you don't and you don't buy it. The overwhelming majority of people don't care about the people who find the price to be so unacceptable as to raise a fuss about it (not to mention write an article about it).

Personally I don't really like Apple's iPod Range. I'm looking forward to the new rival Sony Walkman