The Microsoft Surface RT tablet bedazzles on the outside, but it's what's on the inside that counts for Microsoft's bottom line. A Surface teardown and component cost tallying from the analysts at IHS iSuppli suggest that unlike Amazon and its Kindle Fire tablet, Microsoft may just be making a nice chunk of change with each Surface sold: the components inside a $499 base version only cost Microsoft $271.
Of course, that figure doesn't include costs for R&D, distribution, marketing and the myriad other factors that work into hardware pricing, but that's nevertheless a healthy margin for Microsoft. Earlier this year, an IHS iSuppli teardown of the third-generation iPad with Retina Display put Apple's component costs at $316, and Apple definitively makes money on the iPad.
The smile on the face of Microsoft accountants grows larger if you opt for the company's innovative Touch Cover. The Touch Cover costs $120 as a stand-alone accessory or $100 if purchased as part of a bundle with the Surface tablet, but iSuppli's researchers calculate its manufacturing cost at only$16. Upping the on-board memory boosts Microsoft's bottom line, as well; doubling the Surface's NAND storage from 32GB to 64GB will set you and me back $100, but Microsoft only pays around $30 out of pocket for the extra hardware.
If you want to see what the guts of Microsoft's tablet looks like with your very own eyes, check out iFixit's teardown of the Surface tablet.
Via All Things D. Image via iFixit