Iphone 5C: Smart! ::UPDATE::

I just wanted to talk about how smart a decision it was for apple to make the Iphone 5C. I was going to run so numbers so I could show you why from a business stand point it makes so much sense.

Source

The Iphone 5 cost $197 to build. Would have been sold at $549 per Apples old model.

The Iphone 5S cost $198.70 to build Is sold at $649

The Iphone 5C cost $173.45 to build. Is sold at $549

So what does the $23.55 dollar difference to produce the 5C instead of the 5 get Apple.

I have built a table below. Effectively what Apple has done with the 5C is made it so they do not care what device they sell between the 5S and 5C as the margins are so much closer. This is one reason Apple's stock has been squeezed as of late is because the market noticed a decrease in margins due to Apple's last years model being $100 off but still being expensive to produce. This is very smart from a business stand point I am excited to see if the market will eventually react to this.

Retail PTM Mark up Profit Margin % Profit Margin
Iphone 5 549 197 278.68% 352 64.12%
Iphone 5S 649 198.7 326.62% 450.3 69.38%
Iphone 5C 549 173.45 316.52% 375.55

68.41%

(Note: these were the numbers I could find if you find more accurate/correct numbers let me know I can update)

Update: I have found another website that breaks down the numbers differently. it gives a better cost of materials so after noticing that some of the comments mention we cannot tell the price of the casing it is hard to compare.

Retail PTM Mark up Profit Margin % Profit Margin
Iphone 5 549 197.9 277.41% 351.1 63.95%
Iphone 5S 649 213 304.69% 436 67.18%
Iphone 5C 549 156 351.92% 393 71.58%

Casing cost Iphone 5/5S $48.22

Casing cost Iphone 5C $6.32

This website had completely different numbers and show that the casing is the most expensive piece of the Iphone5/5S construction. It still shows that the Iphone 5C provides much higher profit margins than the Iphone 5 ever could have. Source