Tablet Wars: HP's TouchPad, Apple iPad 2 Have Similar Costs

While this is similar to the analyst's estimated cost of $326.60 for the Apple iPad 2, IHS iSuppli said a couple of major differences in materials and features, particularly the material Apple uses to make its ultra-thin case, differentiate the two devices.

IHS iSuppli on Wednesday released its preliminary analysis of the cost breakdown for HP's new TouchPad tablet PC, and estimated the 32-GB version carries a total bill of materials (BOM), including components, manufacturing costs, and packaging costs, of $318.15.

The El Segundo, Calif.-based analyst firm also estimated a total BOM of $296.15 for the 16-GB version of the TouchPad. The $22 difference between the two is based on the cost of the SanDisk NAND Flash memory used to manufacture the two models. The 32-GB model retails for $599, while the 16-GB model retails for $499.

This compares to a total BOM of $336.60 for the GSM/HSPA version of the 32-GB Apple iPad 2, $333.25 for the CDMA version, IHS iSuppli estimated in March.

The HP TouchPad tablet PC uses the same LG display that Apple used in its original iPad, and features Wi-Fi as its only wireless technology, IHS iSuppli.

However, while Apple makes extensive use of exotic materials including aluminum to produce an enclosure that makes the iPad 2 tablet only 7 mm thick, HP uses plastic, which results in a device which is almost twice as thick at 13.7 mm, the analyst firm said. As a result, the HP TouchPad is less rigid than the Apple iPad 2, but its components are less densely packed, giving the TouchPad room to add other features including more wireless options including 3G, IHS iSuppli said.

Another difference between the two companies' devices is the addition of an inductive loop or coil in the rear of the TouchPad, called the Touchstone, which recharges the battery when the TouchPad is placed on top of an optional inductive charger, IHS iSuppli said.

For the TouchPad, the biggest expense is in the display. IHS iSuppli estimates that the 9.7-inch display costs $69, while the touch screen assembly costs $63.50.

The memory is the second-highest cost factor. IHS iSuppli estimates the cost for the 8 GBs of Samsung DRAM to be $26. The NAND Flash memory for storing data costs an estimated $45 for 32 GBs and $23 for 16 GBs, the analyst firm said.

The Qualcomm APQ8060 dual-core processor, which operates at 1.5-GHz, costs $20, making it the next-highest cost component. IHS iSuppli said this is the first time it has seen that processor without the usually accompanying 3G wireless components, but those components could be added in a future version of the TouchPad. Qualcomm also supplies the components for the Bluetooth LAN connection.

The TouchPad battery is a two-cell lithium-ion model from Amperex Technology, and probably cost HP about $19.40, IHS iSuppli estimated.