According to iSuppli, purveyors of smartphone parts and costs, they estimate the cost of build materials for the Nokia Lumia 900 to be $209.00. The manufacturing cost is a paltry $8.00, bring the net total to $217.00. When you consider the retail price of $99, that is $118 below the build cost. That doesn’t take into account the $100 rebate they are extending to consumers who purchase the Lumia prior to April 21st.
“Given the highly strategic partnership with Nokia, we believe Microsoft substantially discounted its software licensing fees on the Lumia 900 to accommodate the overall lowered manufacturing costs,” said Wayne Lam, senior analyst, wireless communications at IHS. “Microsoft has had limited success with its previous Windows Phone 7 original equipment manufacturers, such as HTC, Samsung and LG. However, Microsoft now is looking to double-down with Nokia to promote Windows Phone 7 and grow the platform.”
There are other factors to consider, including the revenue generated by wireless plans for those who purchase a Lumia 900 or any smartphone for that matter. The retail price of a Lumia 900 is $449. It’s not clear what price AT&T pays for the Lumia 900.