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Wednesday, November 12, 2008
T-Mobile G1 Android Phone Costs Carries $144 in Materials


The T-Mobile G1 smart phone, the first wireless handset to be based on Google?s Android mobile operating system, carries a Bill-of-Materials (BOM) cost of $143.89, according to a virtual teardown conducted by iSuppli.

Part of the new generation of so-called "iPhone killers," the HTC-manufactured G1 combines voice communications with a host of other capabilities, including e-mail, Internet access, camera and music playback. Along with many fellow phones of its generation, the G1 includes a high-resolution display and a QWERTY keyboard. Like the iPhone, the G1 includes a touch-screen interface.

"The G1?s differentiation resides in its use of the Android operating system, which has won praise for its ease of use, but whose major advantage is its integration with Google Internet services and its capability to accommodate the flood of free applications that are becoming available," said Tina Teng, senior analyst, wireless communications, for iSuppli.

Inside the G1

iSuppli determined the $143.89 BOM based on information from its Mobile Handset Cost Model (MHCM), which provides detailed analysis of present and future expenses to build mobile phones with any possible feature set. This estimate includes only the component and material costs for the G1, and doesn?t account for other expenses including software, research and development, manufacturing and accessories. iSuppli hasn?t yet conducted an actual physical teardown of the G1. iSupply had also estimated back in June that the iPhone had a initial hardware Bill Of Materials (BOM) and manufacturing cost of $173.

The most costly segment of the G1 is the baseband, at $28.49, or 19.8 percent of the G1's total BOM. Similar to other recent handsets from various brands examined by iSuppli, the baseband employs a combination of an ARM11 microprocessor for multimedia applications and an ARM7 core for modem functions.

The next most costly section of the G1 is the display, at $19.67, or 13.7 percent of the BOM. The G1?s display is a 3.2-inch TFT-LCD flat touch-sensitive screen with HVGA resolution, at 320 by 480 pixels. The display uses projective touch-screen technology.

The camera represents the next most expensive segment, at $12.13, or 8.4 percent of total BOM costs. The camera has a 3 megapixel resolution and an autofocus feature.

The fourth most expensive segment is the Radio Frequency (RF)/Power Amplifier (PA) portion, which costs $9.84, representing 6.8 percent of the total BOM. This section supports a high-speed 3.5G network connection using the HSDPA air standard.

G1 vs. iPhone features

So how does the G1 stack up against the industry standard for smart phones: Apple?s iPhone 3G? On the feature front, the G1 supports the HSDPA air interface at the 1700/2100 bands for 3G, which limits its U.S. end users to T-Mobile subscribers. However, the G1 is suitable for markets outside the United States using the 2100 frequency band.

In contrast, the iPhone 3G supports the HSDPA air standard operating at the 850/1900/2100 bands. The 850/1900 bands are designed for the AT&T network. Thus, an unlocked G1 phone using an AT&T network can only achieve EDGE download speed.

The G1 comes with a full QWERTY keyboard, which comes in handy for texters. The iPhone 3G eschews a physical keyboard and instead employs a touch screen for input.

Like the iPhone, the G1 includes Wi-Fi, which allows subscribers to take advantage of T-Mobile's hotspots.

As for the touch screen, the G1 employs projective touch technology, while the iPhone 3G uses a capacitive multi-touch glass touch-screen. The G1?s screen doesn?t support multi-touch capability.

G1 vs. iPhone user experience

Many observers have lauded the user interface of the G1. Teng believes it is well above the industry average, but still has a gap to close with Apple?s interface. Consumers can navigate through playlists and albums with a flicking of finger and can access other intuitive features. For a Google fanatic, this device is well integrated with many Google services, like Gmail, YouTube, and Google Maps.

Teng also observed that the industrial design and finish of the G1 lacks the wow factor of some of its slicker competitors. Also like the iPhone, the G1 supports the downloading of music, but unlike the iPhone, G1 users must employ Wi-Fi to take advantage of this feature.

"This is a negative for G1 users when there?s no Wi-Fi coverage," Teng said. "Apple really makes the music download experience transparent; everything is integrated smoothly and seamlessly."

Teng also noted that the G1?s lack of enterprise friendliness is a downside of the product compared to the iPhone and other platforms like the BlackBerry Bold.

"The G1 presently supports only Post Office Protocol version 3 (POP3) mail, which doesn?t work with many corporate e-mail systems," Teng said. "However, this problem can be solved if Google licenses Microsoft Corp.?s ActiveSync synchronization system, as Apple did to make the iPhone more suitable for corporate use. This will allow the G1 to receive pushed mails from Microsoft Exchange Servers or manually synchronize emails through a connector."

The real differentiation and advantage of the G1 relative to the competition is the availability of free open source applications.

"Each day there are about five or six new G1 applications for download," Teng said. "Eventually the G1 will have its own software community, much like the Linux applications in the wired world or the Sun OS has for workstations. This will produce a rich suite of free software for a variety of purposes that anyone can access."


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