Apple iPad's manufacturing cost lies below $260

If you  thought that Apple's 16 GB iPad at a price of $499 was value for money, then think again. The real price for manufacturing the iPad is around a half that price according to research agency iSuppli as we found out on Engadget. iSuppli dismantled the iPad and had a thorough look at what lies inside. According to their best estimates, the price of the materials used in the 16 GB iPad do not go a cent over $259.60. This includes $95 for screen and $26.80 for the A4 processor. The shiny aluminum exterior costs $32, while the battery costs $21. The only reason Apple is likely to quote for the huge price premium is the "research and development" cost. One thing that iSuppli did note was that the iPad was more complicated than it appeared as they found there were three chips controlling the touchscreen. iSuppli had previously researched the cost of the iPhone 3G and had come to a similar conclusion. So now you know the magic formula Apple uses to price its products.