BlackBerry Torch costs $183 to produce; 150,000 units sold in first weekend

BlackBerry Torch Teardown
By Adam Zeis on 17 Aug 2010 11:45 am EDT
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Research firm iSuppli tore down RIM's latest device to see what was inside and find out the estimated cost of the inner workings. The total value of the Torch was estimated at about $171, plus $12 for manufacturing. The display and touchscreen came in at the high point of $34.85 while the memory chips came a very close second at $34.25. The rest of the breakdown goes like this:

  • Mechanical/enclosures: $23.35
  • Applications processor: $15
  • Radio/Wireless: $24.50
  • User Interface: $12.40
  • Battery/Power management: $15.90
  • Camera: $10.80 

So you can see there is not a terribly huge profit on each device. Pretty crazy huh?  [* update from Kevin: i'd better start proofing Adam's posts again. lol.  Adam forgot that carriers subsidize the RIM retail price of a device - they bring down the consumer price by getting you to sign a contract and recoup the discount over the month's they have you locked in.  There is a VERY good profit margin in device sales for RIM - just look at the off contract price!! *]. It was also noted that in the first weekend of sales, RIM sold around 150,000 devices, which shades in comparison to the 1.7 million iPhones sold in the first three days of launch. If you're eager for more on the inner goodness of the BlackBerry Torch, check out our Torch teardown photos and videos and see what makes it tick.

Source: WSJ

74 comments

XWolf

Be interesting to see how this compares to other models, such as the 9700 when it came out.

XWolf

We should boycott that store.

BBThemes

rather than make a totally silly comparison like say iPhone worldwide sales Vs one network, how bout this

iPhone availablilty was minimum 9 carriers at launch, 1.4 million split equally over 9 carriers (we`ll leave out the applestores) is 156,000. so torch is doing just fine, also for more REAL comparisons, storm1 on vzw at launch? 100,000 to 200,000, so not miles off that either.

id still love to see what the captivate sold at launch though. that would be a good indicator as both at+t only

devGOD

no the iphone only launched on at&t US the 2-3wks. it took almost a month before it was available to other carrier.

BBThemes

no it was released in 5 or 6 countries in one go.

alicklee

I think rim does need to open there launch a bit more then 1 carrier at a time. I'm in Canada and i cant get one from my provider until it comes out in the new year :(

triquetra

I saw a post saying Walmart had it for $99!

Garytheman03

Some places in the U.S. are selling it for $99. I'm in Virginia and we've got it for $99 everywhere here!

D_Town_Tony

It may be valued at $171, but dependent on the volumes and such it probably came in a decent amount less.

AgentScribe

I agree. I'm guessing $30-$50 FOB the manufacturer, plus up to $10 per unit in incidental costs such as freight, R&D, marketing, etc.

If they sold 150,000 the first weekend (including mine) then you know the initial run was at least 300,000 plus they have a contract for at least 12 months on these.

I doubt that AT&T paid more than $100 to get that Torch to The Shack here in Central Florida.

thecrazyone1217

You say they have a good profit margin yet they may have spent a fortune to design and develop this hardware, not to mention the OS specialization on top of the OS costs with per phone licensing of random patents that rim uses.

zaersx

I like the way you said random patents; made me immediately imagine mike waking up at three in the morning right out of nowhere and saying "we'll patent that" and then falling asleep immediately afterwards, lol...

zaersx

I like the way you said random patents; made me immediately imagine mike waking up at three in the morning right out of nowhere and saying "we'll patent that" and then falling asleep immediately afterwards, lol...

kneeman

What would they charge us if there were no contracts at AT&T for phones? It wouldn't be cheaper than 499.00. So that 99.00 or 199.00 price you see really isn't that big of a savings in the real world, they just make you think it is by jacking up the stand alone price.

Also, 15.00 for the processor, 15.90 for battery and and power mgt (wonder what the battery is alone)
Who wouldn't have spent and extra 20.00 to get a faster processor and bigger battery? (please don't start the debate about processors here, just saying an opinion)

xiaohuaxing

Since they're making $300+ profit per phone, you'd think they could have upped the processor to at least 1ghz.

You can say that it's on the software loaded on the phone that determines the user experience, but I just went into a store to play with one and it LAGS. When you swipe the menus, photos, etc. across, it stutters a lot. The transition is nowhere near as smooth as with the Captivate. If it weren't for the lack of a keyboard on the Captivate there would be no competition whatsoever between the two phones.

BBThemes

ok, so heres my theory on why they havent updated the processor. Firstly its nto as easy as hrowing another processor in, possibly a better PCB would be needed too, meaning more costs.

the other thing, which im thinking it could be more to do with, is frequency. by this my best example is the palm pre, its can be overclocked to 800Mhx, it could go faster but it screws with the output frequency, which in turn messes up the radio stack, meaning a newer radio stack is needed (or at least a re-developed version) which again is gonna increase ya costs.

thats my theory, or it could just be that the BlackBerry OS just isnt as heavy on the processor as android phones.

im not saying any of the above is justification for putting out a processor that all 9700 users havent moaned about at all, paired with a screen of the same resoloution that the storm 1/2 is which also nobody has ever moaned about, but it could be some of the reasoning behind it.

xiaohuaxing

I suggest RIM skip 1ghz for the next iteration of the Torch that is bound to come out (aka stop playing catch-up) and design around something like this instead:

http://www.wirelessweek.com/News/2010/08/Qualcomm-Chip-Sample-Year-End-Devices/

Mushu118

a pretty accurate cost for this phone. Now to say that there is no profits is just hilarious becuase they are probably sold to AT&T for about $400 at least

MILLYBLICK

There goes that joker selling fake clothing and sneakers... there is no way possible a real pair of Jordans is $30. Who are you gassin up?

jlb21

I think what this continues to show is that it is not so much the revenue from the phones that the carriers are looking for, but rather getting new, and keeping existing, subscriptions and any fees they get for overages and the like. Perhaps AT&T was well aware of the limited sales niche of that phone and struck the deal with RIM to attempt to win over a few new people and to keep some existing people.

I could be way off-base, but it could be the case.

Joe257

Apple had the iPhone on every TV just weeks before they launched. They created a stir in the community for and iPhone, so folks were greased and prepped to line up just to get one. RIM needed to do something similar. I didn't see any TV ads leading up to the launch. The only people excited about BlackBerry 6 & the Torch were BlackBerry forum readers. The rest of the world was in the dark about it... many are still in the dark.

I love the new AT&T ad, and I think more of the same is necessary to raise the profile of the new OS and the new device(s) here now & coming.

admsteck

Maybe RIM decided to spread out the interest by waiting until the phone was out before starting their media push. Less stress on AT&T stores, RIM's manufacturing line, and no backorders.

devGOD

oh come on... don't make excuse like that for RIM. The company does not know how to advertise to the consumer they never have and never will. There're a strictly business company that is clueless. Every company wants a demand / backorder that generates more hype and desire for your product. very few people out side of the BB forums knew about the 9800 launch and that's very sad.

gregorylkelly

Maybe you aren't a business person, but many people I know and/or work with knew about this phone. It had a lot of hype in the business community. You just have to realize that business people aren't going to camp outside of an AT&T store for a phone. They are going to wait a couple weeks and buy one when they have free time. This is why the Curve is consistantly the biggest selling phone in America, because people buy them steadily throughout the whole year instead of on release day.

admsteck

I don't think the math is correct if you are saying there isn't a very large profit on this device. If it only costs $183 to make, let round up to $200 for a little packaging, advertising, etc. Lets not forget that the no-contract pricing is $499! That's $300 profit per phone! Sure, you may only have to pay $199 with a two year contract, but the carrier isn't eating $300 on every phone they sell. They subsidize the that money into your plan every month.

NoKittyNo

$499.99 off contract? Surely that is only an American thing, Lol. Any Canadian Devices exceed 400.00 easy. When I bought and unlocked a Storm2 off Telus, it was like 599, or 649 plus taxes. $499.99 would be awesome, Lol. Here's for blindly hoping...

AndrewMcHorney

I am sure the costs will come down as the production of this phone ramps up. It is not important that sales match or exceed the Iphone. The sales appears to be fine and I am sure will pick up. I thought it was crazy seeing people lining up for hours to be among the first to get the phone. I think they need to get a life.

Skeevecr

Not sure where you are getting the idea they aren't making much profit per device, all the hardware makers will be getting quite a bit more than $200 per device from the carrier because it is the networks and not the hardware companies that are subsidising the prices paid for phones on a contract since they are the ones that benefit.

Personally, I would be quite surprised if Rim and AT&T weren't happy with those launch weekend numbers, it is part of a range of blackberry handsets rather than the only one and also the business part of their sales will tend to upgrade a bit slower too and just because they are prepared for more sales doesn't mean they were expecting them all in the first week.

pkstanoev

...and now you can buy it from Amazon for $99... Just one week after the launch, RIM is selling it bellow the manufacturing cost? Not a good sign..:(

Skeevecr

You are mixing things up, Rim aren't selling anything below cost, this is simply a the subsidised price of a 3rd party for a phone with a contract undercutting the standard price being offered by at&t.

Kevin Michaluk

Just read Adam's post here. YIKES. I'll slap him on the wrist. I fixed up the post. There's very good margin in the phones for RIM. Just look at their financials!

gnahc79

Just a reminder that the $183 cost is not the total cost of the Torch or any device. There's all the development costs that went into the device, marketing, etc. The profit margin is probably still good, but don't base it on just the device itself. The physical cost of the device is nothing compared to paying all the people involved.

robarias

BIS/BES is really useless, and expensive. OS is old, devices are good, but with a crappy OS they are useless.
Who wants a Bold 9700? Im selling mine to jump into the iPhone train.

MrFadedGlory

I jumped ship from BB a month ago and I absolutely love the iPhone 4........you will not regret it!

Ki-Adi-Mundi

Because I'm about to jump too.

jjetson

Honestly....

iPhones are for 13 year old girls and sheep that just follow the flock without any knowledge of technology. Until Apple upgrades their glorified pause/resume multitasking and lets application really run in the background I'm not even putting it in the league of "SmartPhone". P.S. any phone that can be rooted (this means taken over by someone else), just by going to a website is a totally insecure POS, and should be removed from the market immediately. At least go buy a rootkit prone bloatware loving android. So that you can spend your contract having ads shoved down your throat by adsense and admob.

Signed
Do your research and get a clue

NoKittyNo

I am not jumping per say, but wading out into the water.

I've had countless BlackBerries, Qwerty, SureType and Touch and while BlackBerry held my interest, it slowly lost its efficiency appeal after the Storm1, countless Battery Pulls and that in conjunction with the Bold 9000's BB pulls and lack of memory.

I love their devices, for the most part, I think they are solid, I cannot tell you how many times I dropped my Storm 2, back down, face-down, sideways.. Downstairs. UPSTAIRS(lmao) even and it held its own! But I just wanted something a little more glamorous, and that is why I am waiting for Rogers too finally update their site with the Samsung Captivate.

I had an iPhone 3G for 3(2?) days and the experience was nice, the screen was so responsive it was awesome, the keyboard was FANTASTIC - and coming from one of the worst typers in this universe, the fact it could fix my mistakes was superb. The browser was immaculate, the browsing rendering, switching I looooooved it. But I missed the small things, that blink-y light of "You've got mail, text - missed call" my perrty Berry Weather App and the high customization, I sold my iphone 3G and my Rogers contract and am waiting for the right swooner.

I think the Torch has exactly what I want, Touch and Keys, but what it doesn't have it what bothers me, and honestly(I know all phones have their ups and down) I don't know if I want to go through another Year of Lag, drooling for incremental leaks and a browser that(true story) when I launch I put the phone away as it loads, cause I don't want anyone to see how slow it is(forging the "web kit")

I dunno guys, I Love Crackberry more than Icecream, and Blackberry more than Coffee..Okay, not coffee.. Donuts then(lmao, easier pick) .. But I want something that will run as smooth as it should, not barely making it.

Know what I am sayin?

Annnnnnyway, regardless I think the idea is great, and if the Torch comes first I may pick it up before the Captivate drops, but there will always be that "... If only ..." feeling, and I don't wanna dwell on that with my phone for 3 years, Lol.

Do you?

jjetson

I'd rather have all those scenarios than an android or an iPhone that is hacked as easy as calling the phone or visiting a website.

Do you want your identity stolen? Or huge data plan bills because hackers are racking up your usage?

Make your choice.

Do your research it's as easy as the following google searches:

Android rootkit
Android bloatware
iphone 4 pdf exploit
iphone rootkit

then type in

blackberry rootkit

Don't listen to the fanboys/RIM haters and their 1 sentence this sucks, that sucks, RIM sucks. If you do remember the day I posted information for you to look at before you made your decision. Android/iPhone = INSECURE. The faster they are the faster your data plan will get racked up by hackers.

NoKittyNo

I am sure we all would, no doubt, but I also question sometimes the security of anything that saves passwords.

When I was using Opera Mini on my Storm2, and saw a general question pertaining to its security and cookies, got me thinking about in general 3rd party apps and browsers.

Also, Notice my comment was not a one sentence or one word-ed ipphonefanboy, I executed some valid two-sided points, as it should be done :)

STR8WESTCOAST

The sales are too funny and this phone is compared to the iPhone. I bet the doors were coming off the hinges on this release date. Way to go. This is like comparing Jay-Z to Jermaine Dupri

kattboxx

I don't understand why RIM decided to go exclusive with AT&T when AT&T really has an allegiance to the iphone 4. To me it would make more sense to go to a competitor like Verizon that boasts a better framework network for smart phone devices and is big enough to do a killer launch of the product and no iphone Apple competition on it's network! Please RIM listen to me bring the Torch to Verizon Wireless!

ottscay#CB

For starters, in case you haven't noticed, AT&T is running headlong from being dependent on iPhone exclusivity (probably because it's coming out on Sprint early next year...I don't believe for a moment it's coming to VZ in Q1 2011) but regardless sooner or later they will lose it and they need to diversify their smartphone portfolio or risk a major stock and revenue drop.

They were probably much more interested in ponying up marketing dollars (and store space) for a high profile BB, while (as you may have noticed) Verizon is spending their marketing dollars on Android. Indeed, given the success they are seeing, I suspect VZ has little interest at the moment in trying to pimp for new RIM products, aside from ones already contractually obligated to (the Storm series, mostly). The fact that the clamshell is apparently not even going to stay a VZ exclusive should show you how tepid their interest is right now.

The feeling may be mutual, since VZ's deals for early smartphone upgrades to Droid products has been really cannibalizing Storm customers (that's when I switched). I'd say the LTE Storm (not the Odin refresh) is probably the last major chance for a long-term relationship between RIM and VZ when it comes to high-profile phones. I for one hope the Storm LTE is an incredible phone.

ottscay#CB

150,000 is a solid set of sales numbers. If AT&T can shake off the reputation that their network has gained (fair or not) I bet they could pick off more than a few BB users from other networks. More important will be whether or not phone sales stay strong, or taper off quickly.

Also...yeah, plenty of profit there. And articles claiming that RIM is "cutting their prices already" are just silly; Amazon discounts phones beyond manufacturer pricing all the time, and this is just one example of that. I don't think we'll see a reduction in pricing with those sorts of sales numbers for quite some time.

Still, this phone won't be a panacea to RIMs larger strategic positioning problems in the smartphone business, so let's hope they have some exciting phones coming in the next year.

markccs

No point comparing 1 carrier sales to Icrap4 which was almost worldwide... Torch doing just fine so far.. wait until it reaches decent levels of penetration of the market (carriers)... and it is already very clear that the price tag is 499$, so the margin is fairly nice.. RIM people are not stupid, so let's wait and see

gregorylkelly

Also, the iPhone is the only Apple offering while RIM has many different BlackBerrys in many different shapes and sizes. They have high end, low end, touch, small (pearl), and now a slider.

xattica

WOW! No info on the specific processor so far. PXA930 or PXA935????

HTC_Droid_EvO

Because the torch sucks big time

jjetson

I agree, don't hate the iPhone because you like or dislike the torch. Hate the iPhone because every new user that buys one is another potential networked device that can be controlled by a bot master that will use it to send spam all over the world. Increasing the amount of spam you may get as well as increasing the cost of products since more r&d needs to go into them to weed out the spam and virus's. All because Apple can't release a secure OS. Also hate on android because Google isn't taking the time to code in security to keep apps inside their sandbox and therefore producing an influx of rootkits that as well are allowing bot/spam masters to control the devices and cost you money.

katiepea

i'd like to see more numbers like number of handsets produced, and number sold together, because i have a feeling they've made way more of these than they're ever going to sell

ajmac25

Come on RIM you can do better. OS 6 looks good. This fun is not. Touch screen is the way to go. Lets get a real Storm 3 with OS 6.

HTC_Droid_EvO

It is ...

Maybe they will upgrade when the storm comes around and finally catch up with Apple or Google

jjetson

Hopefully Apple and Google will upgrade their OS's and make them secure like Blackberry. That way Android/iPhone users won't get their identities stolen anymore.

I'm starting to think you're just a hacker trying to make more people buy crappy insecure phones so you can hack them and make money off of them.

gregorylkelly

I don't even know what the hell your post is really saying....anyways, I love my Torch. Its a Touch Screen with the best keyboard of any touch screen phone ever made and it has, in my opinion, the best OS evee made.

Maybe you should try one before bashing it. Phones aren't all about the specs writen on the box. Maybe one day all you fanboy tools will learn this.

HTC_Droid_EvO

http://www.phonearena.com/htmls/Wall-Street-firm-says-RIM-sold-150000-To...

Check the link the torch got blown out

Now you guys cab cheer on the clamshell...let's see what the storm 3 does until then change your skirt kid
:)

jjetson

Theres 150,000 users that don't have to worry about applications rooting their phone and stealing their bank credentials. Unfortunately thats not the case for how ever many new Android users their were that weekend. Those unlucky people are rolling the dice with insecure devices.

jjetson

http://www.zdnet.com/blog/gadgetreviews/sprint-corrects-statement-about-...

The EvO recorded the exact same amount of sales its first weekend.

LOL

HTC_Droid_EvO

Is in danger ...That's Samsung ..Apple..Google..LG ...and the list goes on. Oh yea let's not even talk laptops or now tablets

Please stay in your bubble ...if you come outside you might catch the swineflu ..oh yea big brother is watching and tainting your water

jjetson

You're right ALL phones running iOS or Android are in danger. Take your head out of the sand and read some tech news or some of the topics at defcon this year. You know how big of a business spam is? do you know how many devices are currently controlled by botnet owners?...obviously not! Or you would think twice about the device you browse the internet with. Actually for you..since you have an Android phone you should think twice about answering phone calls! THAT'S RIGHT! PHONE CALLS! Android phones can be taken over by the simple action of answering a phone call. But seriously keep promoting them, and everytime you do I'll be there to make sure users know just how easy it is to hack that crap OS. People need to be informed about the horrible security issues that Android has and how iOS and Android are decades behind RIM when it comes to security and protecting users and their privacy.

HTC_Droid_EvO

Dude made my night I should fear everything and hide behind a phone ...what you don't shop online, lol how many people use iPhone and Android , and never experience that ...more than those who do.

Maybe I shouldn't drive a car without a 5 star crash test rating ...maybe no one should ..they could die or something one day

:) you guys are pure comedy ...and the post speaks of 3 million iphones not the Droid Evo ...I have a Droid X. My name represents Droid the OS HTC the company and the ground breaking EVO ...unlike the torch

jjetson

Groundbreaking phone that sold the exact same amount as the torch in the first weekend LOL!!!! and you have absolutely no stats on how many Android and iOS users have been hacked! because 98% of them don't even know. But I know how many BB users are hacked 0! because there are no rootkits for BB! Hey I have an idea...lets send your phone number to some defcon presenters. Then we'll send my number. Lets see who gets hacked. Android SUCKS!

And it doesn't matter how many people shop online etc. Thats like saying I cross the road once a day and have never got hit so maybe I should run back and forth threw traffic all day long. Don't be upset you're phone is probably hacked already. Who's controlling your device? I know I'm the only one controlling mine. Do You? Get ready for the big data usage bill. LOL Android SUCKS!

IrieBro

Please cite the source of your phone call hack. I searched the phrases you suggested from another piece of FUD in this thread and cannot corroborate ANYTHING you have posted. Is this what you're taking about?
"Once it's INSTALLED on the Android phone, the rootkit can be activated via a phone call."

I suspect you don't know the number of Android/iOS users are hacked either. 98%? What else can you pull from your ass? It is entertaining to watch this community during RIM's decline. The excuses and apologies are really flowing now.

jjetson

Don't be upset the OS you love is riddled with security holes. And I never said 98% of users were hacked I said 98% that were wouldn't know it. Get your reading glasses on. You're on here saying I'm full of it but at the same time quoting a source that an android rootkit can be activated via a phone call. LMAO Android is a joke. Developers are so pissed at google and all the companies using android that their leaving in waves. Cross/Forward compatibility is an absolute joke on that platform. The Security is non-existant. Every company is changing the OS to suit their certain hardware.

It doesn't matter anyways. You're probably not even in control of your phone...a bot master is.

green_ember

Is it any wonder that the sales numbers weren't higher? They released it exclusively on the only network that carries the iPhone, and just had hundreds of thousands of people sign new contracts not even two months ago to get the newest model. Who on AT&T was even still eligible for an upgrade? I think we will see sales go up nicely when Rogers and the other Canadian carriers start offering the device...

HTC_Droid_EvO

Except the hack-proof blackberry...good luck telling your wife girlfriend and kids or friends ...that there phone sucks that ONE DAY you might get hacked, or you might already be hacked...but all that smooth scrolling and watching videos ...hi res screen...is gonnnnnaaa coooosssttt yoooouuuu....

LMAO...keep going guy PLEASSEEE

BWHAHAHAH

jjetson

You can talk about hardware all day long. But the fact is, Android OS is complete crap. It's overflowing with bloatware, and rootkits are taking it over. I don't care how pretty a screen looks, if theres someone else using the phone for illegal purposes without me knowing.

lilsquirt47

I have not owned a Blackberry, as they are expensive, but would love to, maybe I will WIN one. Thank you.

eeellis08

I know you need to make a profit but 500 from 183 its a lot of money for a regular working american,

moe4646

The reason I visit this site is for my wife's 9700. I am here today to see when os6 will be released for this handset. You see, it freezes, locks, and basically stops working 2-3 times/day. I thought perhaps the new os would fix this issue. And, yes, I have a replacement on the way. My concern is that a friend at work has the same problem with his Tour...exactly the same. I also see posts all over the web about similar issues.

My point is I come across this feed and see one guy claiming an iphone can be overtaken by "hackers." The next guy states 150,000 units sold "is good." I own an iphone 4 and have zero issues with it, nor with my 3gs, nor with my 3g. Never...one...issue (even the foolish "death grip" that was so silly ot os now laughable). My wife wanted the physical keyboard, so here I am with RIM.

I use an old Curve for work email. Along with my wife's Bold, I am very, very familiar with Blackberry. In no uncertain terms, it cannot hold a candle to iphone. There is no comparison. There is a reason why the Torch sold 150,000 units and the subsidized price is down to $99 almost immediately; it can't compete with iphone. It's not that I dislike RIM, it's that comparing the 2 is like comparing apples to dump trucks. Once RIM realizes that a great user experience is not sub-menu after sub-menu, perhaps they will build a device as elegant, intuitive, and useful as Apple's.

DaveGravy

Its great hardware and feels good a real quality build however,Super Amoled Screens and 1Ghz Processors Seem to be the standard nowadays, RIM missed the boat like HTC did When They Released the HD2 on t-Mobile with wm6.5 Then anounced Windows Phone 7, I think RIM has something up their sleeve, no way they plan to eat the costs on this...I don't recon the death star will either.