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Google Glass Parts May Only Cost $80, Google Calls Report “Absolutely Wrong”

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Google Glass is incredibly expensive. At $1,500, the Explorer Edition is a product aimed at at a select group of developers and tech enthusiasts who want to be a part of one of Google’s visions for the future. In other words, it’s not meant for the regular Joe, unless the regular Joe has a ton of cash to blow. The odd thing is, that most of the parts that make up Glass are pretty old at this point and probably not worth their $1,500 price tag.

According to a teardown of the wearable by Teardown.com, the sum of the parts may only add up to around $80. Let me say that again – $80. 

If you consider the ancient TI OMAP 4430 processor (similar to the one found in the 2011 Galaxy Nexus), small battery, WiFi and Bluetooth modules, and low-end camera, the part list certainly doesn’t add up to much. From the outside looking in, only the prism used as the overhead display on Glass seems like the expensive component.

Google has already denied this dollar value, stating that the figure is “absolutely wrong.” So there’s that.

The number does seem quite low, especially when you factor in manufacturing costs and the level of engineers who have worked on the product. I’m not saying that $1,500 is justified, but $80 in parts doesn’t quite seem right. Teardown.com also noted that this figure was a “rough estimate” and that it may change after they finish a thorough breakdown.

If you bought Google Glass, I hope you didn’t just read this.

Via:  TeardownWall Street Journal
  • socalrailroader

    That just proves Google is as greedy err I mean hungry as the other companies out there. Apple, Google, Microsoft, they’re all the same, despite what they preach.

  • http://www.ytmnd.com MH

    4430 was in the bionic. 4460 was in the Razr and Gnex.

  • kashtrey

    People really just don’t get it. The price of the product now isn’t to recoup development costs (that’s not how product pricing works FYI), pay for brand new offices, or pad Google’s pocketbooks. The price is mainly used as a barrier to entry to limit demand to only those with a serious interest in working with and developing for the Glass platform.

    There’s obviously a lot of pent up demand to try this product and if the price were lower, withing the $500 range, a ton more people would splurge on the device. Having a ton of early adopter types buy into a platform that isn’t fully developed and doesn’t have an app ecosystem or a solid foundation would lead to bad initial experiences, terrible word of mouth, and kill all of the buzz and hype about the product. So Google prices the hobbyist out of the market and makes it so only those truly passionate about it (who would understand it’s potential and accept its current limitations) can buy. At the same time this also leads to more hype and an air of exclusivity which never hurts.

  • sggodsell

    Has anyone bothered to even look at the source. They list the display screen which has a resolution of 640×360 and the touchpad components as only $3.00. I would easily pay 30 times that for those components and make my own version of Glass for less then $100. Also I noticed another component BB+XCR is listed as free. Please can I have that manufacturers name. I would love to get some of those free components myself.

  • RAZR_FANN

    I believe the TI OMAP 4430 was used in the RAZR and the Bionic.

  • https://www.facebook.com/christopher.johnsc chris_johns

    oh google…you and your silly glasses…cant even read power levels ppft

  • John Clausen

    The parts may only be $80, but also included in the price is the R&D, and EVERYTHING ELSE that comes with developing a 100% new product that has only existed in science fiction up to this point. And look at how many they’re producing. It’s not many. Once they start churning these things out, price/unit will fall, so the sale price will fall with it.

  • n900mixalot

    Yes Google has all of these overhead costs but they’re better able to foot the bill. Their budget is built with R&D and manufacturing included. All they’re doing is making you pay for everything; i.e., the project funds itself. Google isn’t putting a single dime into it.

    Not saying it’s bad or good. Just saying you’re footing the bill and they’ve reduced their financial risk to basically $0.

    If they decide to squash the project entirely they lose nothing.

  • JordanMcRae

    Direct materials are only one part of the cost of the product. You also have to account for direct labor and manufacturing overhead. And they certainly are not producing at scale which makes the costs per unit even higher.

    • n900mixalot

      1500% higher?

      • sirmeili

        No, but there is a high barrier to entry meaning that those that are going to buy them are more likely to use them and google wants the people buying them to use them. It makes complete sense to me. I honestly believe there is more to this than just the cost of manufacturing and parts. I think there is a cost to being an early adopter and having that privilege.

        • n900mixalot

          They have $0 cost of manufacturing and parts with that high of a markup.

          • sirmeili

            Wrong. No matter how much you charge for something, there is still a cost to manufacturing and parts. They don’t just get them for free because they charge a lot. It may be a small %, but as I stated, I don’t think the cost is to cover the device, but to get the user vested in it’s use and help push it along. Also see my other response to you where I discuss other costs, like the engineers who are likely putting a % percentage of time into this product and likely get paid a lot of money. For all intents and purposes, this product is still in the R&D stage and Google just allowed people to buy into that stage and give their input. Nothing wrong with that as long as the users knew that going in, and in fact they did.

            You, however, don’t seem to want to get that. It’s ok though. You don’t have to buy it at $1,500… You just don’t have to buy it.

        • n900mixalot

          So now we have Epson with their glasses that cost $699. That makes me even more skeptical toward Google’s pricing.

  • MasonMathews

    Maybe I missed something, but wasn’t the reason the Galaxy Nexus never got an upgrade to KitKat because TI didn’t make new binaries(or something) to support KitKat, yet Google Glass using the same processor is able to run KitKat? If that’s the case, things are not adding up!

    • n900mixalot

      They aren’t adding up anywhere other than in Google’s bank accounts.

  • rebecajay

    Ya beacause theyalready cost like a millon they should give it $50.00

  • Coinmanmat

    I still say despite development costs and manufacturing costs, Google still makes a $600-700 profit

  • https://twitter.com/AndroidRevenge Mike Sullivan

    They didn’t take Into account the pixie dust and unicorn farts!

    • http://www.naskaras.com/ Thanassi Karageorgiou

      Unicorn farts alone are worth $400 an ounce.

  • Chris Bice

    This would be why I won’t spend money on the first versions of any product – Arnold is right… And the consumer version will most likely have better hardware than the explorer edition by the time its released.

    • flosserelli

      That is precisely why I didn’t get Google Glass last week. No point in dropping that kind of cash on hardware that will be a dinosaur when the “consumer” version is released for less money, and will undoubtedly run better, last longer, have more apps, and be more practical in general.

  • jb

    Only an idiot would believe that manufacturing costs are directly related to sales price. This article is a complete and utter waste of time. The article could have just as easily been something like: “Newsflash! Businesses operate to make as high a profit as possible!” and it would have been the same level of “NO **** SHERLOCK!”

    • n900mixalot

      U mad bro?

      • jb

        You unoriginal bro?

        • n900mixalot

          It reeeeally seemed to fit there. U just seemed mad there … bro.

    • JRomeo

      How much profit do you think Google makes on the Nexus phones it sells?

      • jb

        As much as they think is possible, given their goals. Same as any other product. For any other company. Ever. It’s called capitalism.

        • JRomeo

          Google deliberately decided to make a lower profit than they could have when selling the Nexus5. there are millions who prefer a Nexus phone simply because it eliminates lag, its sim-unlocked world-phone, and its pure google stock experience. (no bells and whistles to clutter your experience), and many of them would have paid higher prices for the Nexus phone. I know I would have. I believe Google lowered the price on Nexus in part due to them wanting to infiltrate the android operating system even further into the ecosystem. but that wasn’t the reason I purchased it.

          • jb

            Google chose that price for a reason. Based on their marketing data, that phone at that price would sell X number of units and provide Y profit overall and Z profit per unit. It would also achieve other non-monetary goals as well. Of course they could have charged more per unit to try and increase Z, but perhaps Y would have decreased because X would DEFINITELY decrease. That’s supply and demand my friend (along with basic principles of economics like economies of scale, etc). There are (almost) always fewer buyers at a higher price.

  • Elmer Fudd

    As Microsoft so elegantly schooled IBM in the 80′s. It’s not the hardware that’s importantr.

  • Patrick Crumpler

    At this point these are almost custom made. So any price can be justified, within reason. A lot of people said they would buy if these were around $800 or would consider. My guess is these cost about $400. That prism and the fact that there is no assembly line means a lot if the parts are either modified or just not mass produced. It keeps costs high. In comparison, I would imagine that the circular screen on the Motorola 360 will be the most expensive part. Easily $150. For the first year. 360 will probably be around $500. And Glass will probably be about the same price when it goes mainstream.

    • n900mixalot

      How much was the Aura when it came out with its circular screen?

  • Hershel

    of course they will deny it….

  • Simon Belmont

    I doubt it’s only $80 in parts. We also can’t forget the cost of R&D, development of the software, assembly, etc, but yeah, $1500 is probably still WAY more than all of that put together (and we’re only talking BOM costs here in this case).

    Even when they had the public offering for a day I had no interest. I’ll be more interested when they finally offer the consumer version that will likely be quite a bit less than a third of that price (just a guess).

    • Keith Hollis

      no, no, no….businesses are supposed to provide jobs and services to the people of their communities to improve all our lives. Congress needs to stop this insanity at once. If the parts cost $80, they should be selling them for $90 tops.

      • n900mixalot

        Because Bay Area engineers are so downtrodden and poor and great talent is so hard to come by up there.

      • Keith Hollis

        just for the record, that was sarcasm

  • morgan boyle

    its worth $80 in parts when its being mass produced. without ECONOMIES OF SCALE all of our electronics would be outrageously expensive.

    • morgan boyle

      and R&D, Marketing, etc all get calculated into economies of scale when the final product rolls of the assembly line.

      • n900mixalot

        Okay then what about wild risky products like Nest? Or, I dunno, the Galaxy Gear? Or … the Pebble? Based on your (and Google’s) version of Economies of Scale, those devices should cost ten times what they do.

        • morgan boyle

          what?

  • Good_Ole_Pinocchio

    Doesn’t matter that it costs $1500. It’s not a consumer product yet. You want it now? Pay $1500 and don’t complain…..or wait for a consumer release.

    • Hershel

      and pay only 1400

      /s

  • S9779

    I do think care what it cost. Really should anyone be surprised. It’s not like the hardware was a secret. I work with people that do not blink at spending 500 bucks on sneakers. What is the bill of materials on that.

    An items value is exactly what someone is will to pay for it. Not more or less.

  • Arnold

    I bet the consumer version retails for either $399 or $499. It’d probably be in the $200-$300 range to produce.

    • Simon Belmont

      I bet you aren’t far off the mark. Though, I imagine with fine tuning their actual BOM costs will be under $200, by a tad.

      Like I said above, though, that doesn’t account for R&D, assembly, eventual advertising, and upkeep up of the software. They all factor in.

      • n900mixalot

        So then … you’re saying that $1,300 per device is reasonable to cover those costs? Okay, then why did Chromecast cost only $35 bucks? Or Google TV was only a few hundred, and yet somehow this is $1,500? And holy moly, what about other manufacturers who create devices like the Nest, who only charged a few hundred dollars at the outset?

        I’m more onboard with the high cost of entry argument and their desire to keep “riffraff” out of the ranks of their Glassh*le army … There is NO WAY R&D and other costs add up to $1,300 per device … or $1,400 per device if we accept $80 for parts.

  • sciwizam

    “Display/Touchscreen/Glass ~$3.00″

    Yes, a 640×360 0.5″ screen that’s never been done before is worth 3 bucks…..

  • JuanL

    ya but its parts ($80) + sucker tax ($1420) = $1500.

    • cwillen

      I forgot about the part where R&D, engineering and labor were free… $1,420 sucker tax… Good call.

      • n900mixalot

        You seriously think that crap costs $1,420?! And for Google? Hah! Apologist.

        • sirmeili

          No, but as I put above, they intentionally put a high barrier to entry on this to keep every Tom, Dick, and Harry from buying one. If you spend $1,500 on a device like this, you are likely very heavily invested in it’s success and are more likely to put the time in to use it and test it appropriately.

          The cost makes absolute sense to me from this perspective. It’s not about being a Google Apologist, it’s about a smart business move on their part.

          • n900mixalot

            My bad, I shouldn’t have called you that. My point was poorly attempted, but it was that Google is basically pushing ALL of the risk onto the people who pay that $1,500, and then some. They don’t stand to lose anything at all at by charging that price.

          • sirmeili

            You didn’t call me that, I just responded to your comment ;)

            I also think you’d be surprised how much money it takes to continuously develop a product like that with such a small user base. The people working on this project I would guess make over 50k/year if not 100k+/year EACH. How many Google Glass do you think they’ve sold? (I really have no idea on how much they sold)

          • n900mixalot

            Sorry to bring this back up … but Epson’s glasses are aimed toward a narrow market, and they cost $699. Now I’m even more skeptical toward Google’s pricing.

            http://www.epson.com/cgi-bin/Store/jsp/Product.do?sku=V11H560020&BV_UseBVCookie=yes

  • Anon

    . . . yeah, because the sum of parts is the only thing involved when calculating how much something costs. What about the R&D time, design, programming etc. . . none of that is free.

    • Maxim∑

      Oh so now 1,500$ glasses are justified yet you complain of a +649$ phone

      • cwillen

        To be fair, there’s an element of volume that you’re not taking into consideration when you bring a $650 phone into the equation. Glass isn’t even CLOSE to the mass production numbers of even an unpopular phone from one of the OEMs; let alone something like the S5.

        Comparing the markup in Glass to that in a phone is apples and oranges.

        • Gamerboyb1

          You mean apples to Samsungs lol!

      • WickedToby741

        It’s not a consumer product. It’s not yet meant to be a consumer product. The $1500 price tag is not likely an accurate reflection of how the final product will be priced. Also keep in mind that Explorers who have been in the program from the start have received a few different hardware revisions already, so they didn’t pay $1500 for a SINGLE pair of Google Glass.

        • ThomasMoneyhon

          and Im not going to suggest they would, but knowing how much money google is sitting on they could do all the explorers a solid and ship them final retail hardware first, for free. Microsoft routinely gives out free copies of software to beta testers, however that is software and not hardware.

      • Cowboydroid

        The PRICE of a good is a function of supply and demand. Production costs only factor into the margin of profit on the good produced.

        • germknoedel

          Wow, the marketing people at Google must be awesome. The price of the Google glass has not changed once, they must have sset it JUST right.

          • Cowboydroid

            Do you even economics, bro?

      • JRomeo

        I wonder how much profit is made on the Nexus5 phones google sells.

      • Fatty Bunter

        That’s a terrible comparison. Smartphones are commodities. Google Glass is the polar opposite.

    • Kevin

      What about it? No where in this article did it say it’s the total cost just the parts alone. Not including the labor etc.

      • sirmeili

        I would have to say it is brought up because the article implies that the cost of parts is the only part of the equation, which it not the case.

    • Alex Boro

      Yeah. I know labor is mad expensive, like 1425 dollars expensive.

      • BAoxymoron

        Have you ever payed a team of some of the most over qualified engineers in the entire world… I mean we’re talking about a company that has IT people who have doctorates in telecommunication engineering…. sounds like someone who’d work for minimum wage. Also everyone seems to be missing the fact that silcon is cheap… it’s manufacturing the silicon that is expensive as hell and you have to factor in all of the chips which fail and thus must be thrown away which will be a fairly high amount particularly when the new SOC is initially being made and the recipe of which temperature, how much dopants and other factors are still trying to be figured out for the optimal yield. I could go on for quite awhile about the ignorance of the claim of “cost” but either you understand how much goes into making your device or you don’t…

    • Nowai

      Everybody keeps forgetting distribution, manufacturing contracts and labor in that too

  • Tony Byatt

    If that is the cost or if it’s double that then it bodes well for the retail version…

    • n900mixalot

      No it doesn’t. Glass is still going to be very expensive when it comes to market.

      • sirmeili

        So you assume.

        • n900mixalot

          Nope, I’ve been on all of those hangouts with Explorers and none of them will tell you that they believe the price of Glass will come down much from what it is now.

          • sirmeili

            Do they explicitly say that it won’t, or do they just never say anything about it? If they never say anything about it or ignore the question, you are still making an assumption. I really don’t know either way, but I think even Google knows that at $1,500 this will not have mass appeal, and if so, they may be ok with that.

      • Tony Byatt

        We’ll see…I hope it’s not…

  • robvargas

    It’s a prototype. The gadget equivalent of a concept car.

    Its value is based on its exclusivity. It can’t be exclusive if everybody can afford it.

    The consumer version will not have such restrictions.

    • Patrick Crumpler

      Exactly.

    • Keith Hollis

      my 1st thought exactly. prototype cars cost millions to make, but then the final production car might only sell for $30k. Nothing to see here.

      • michael arazan

        The resale on the First Generation is going to be awful when the consumer version comes out too.

        • http://www.naskaras.com/ Thanassi Karageorgiou

          Maybe they’ll end up in auctions, museums and ridiculous ebay auctions…. provided that Glass becomes a huge hit and revolutionizes the way we compute/interact. But I don’t think that’s gonna be the case. I still think it’s the glasses version of wearable bluetooth douchebaggery. Only time will tell.

  • Ian

    Then we can hope for $99 retail right?

  • Nicholas Ruiz

    80 dollars seems wrong but it probably isn’t too expensive to make

  • Justin Foster

    ROFL. “Okay google, compare google glass to Chinese batteries.”

    All results have been hidden for duplicate entries.

  • brkshr

    I think Google is aiming for a specific group to represent Google Glass. That’s why they have the high price tag and the initial invite only system. With privacy fears and the whole “Glasshole” thing. They are trying to make sure that Google Glass users are upstanding citizens that give people the right initial impressions of Google Glass.

    • Ray

      Just because you spend $1500 on these doesn’t mean your not a D*ck head

      • brkshr

        I agree, but it sure will eliminate a lot of them. A $1,500 price tag eliminates a ton of kids right off the bat.

        • n900mixalot

          Not really. I see as many “kids” with them as I do adults.

  • Ray

    Google says $80 is wrong but wont say the actual price.

    • Blake

      I don’t imagine many companies quick to chime in actual build costs. From what I’ve seen it’s in the $200-300 range for BOM.