The Palm Pre is expected to help clean up the red-ink in both Palm and Sprint’s accounting books. Time will tell if the Palm Pre and the all-new WebOS can live up to that task. What we do know, however, is that the Palm Pre hardware components cost less than those in the BlackBerry Storm, Apple iPhone 3G and the T-Mobile G1. A new report from the bill-of-material analysts at iSuppli suggests that each Palm Pre costs about $138 in parts. If true, Palm is on track to take advantage of some seriously favorable profit-margins with the Palm Pre.
It’s pure speculation at this point, but iSuppli expects Sprint to pay Palm $300 for every Palm Pre, subsidizing the smartphone in order to sell the Palm Pre to customers for $200. At that price-point, Palm may be working with a 56% margin on the Palm Pre, before figuring in patents, royalties, manufacturing and shipping costs. Extend those numbers over (hopefully) millions of units, and Palm may just pull of this year’s most profitable handset launch!
The Pre’s components are largely comprised of relatively cheap processors, like the $11 Texas Instruments OMAP processor. The 8GB of internal storage will run $15.96, while the 3.2-megapixel camera is expected to cost $12.39. The stand-out cost for the Palm Pre is the 3.1-inch capacitance touchscreen display, which weighs in at a hefty $39.51 per unit.
All eyes are on Sprint and Palm at the moment. June 7th, anyone?