Originally Posted by mrblanche
While it may cost $188 to produce an Iphone, not much of that goes to the Chinese factory. In fact, in a discussion I heard last month, 80% of the cost of the Iphone is incurred in the U.S., and that's true for almost all things made in China and sold in the U.S.
And keep in mind the Iphone doesn't sell for $650. It costs $100 or less for most buyers.
It is the long history of foreign manufacture that it raises the foreign location out of poverty and into the modern world. Look at Japan after WWII, Korea, Indonesia, etc.
The iPhone 4S is not available for $100 anywhere, I can assure you that with absolute certainty. If you are considering subsidized contract pricing, the price of the phone is rolled into the contract over the 2-3yr period, hence why my last phone on contract was negative -$50 (less than free) and explains why non-contract plans are so much cheaper (no phone subsidies). The estimated cost is the actual cost of all of the components itemized one-by-one from the $10.75 A4 processor from Samsung, $2.60 gyroscope chip, to the $0.65 accelerometer, but is not inclusive of R&D, marketing, assembly, and shipping. The proof is in the pudding though, as the iPhone alone accounted for 40 percent of Apple’s profits according to last quarter’s figures, and those profits were astounding. Point was simple, if there was a will, Apple could easily ask for a 20% increase to factory worker wages without having to raise the prices of its products by a cent and still have the world's most wealthy executives and sustain great profitability. Greed is a good and healthy thing... within reason, and the late Steve Jobs doesn't need nor deserve $8.3 billion net worth for his contribution while the people slaving for him can't afford pop tarts and factory management has to install nets around the building to catch suicide jumpers (not kidding, they really did).
You are absolutely correct though that the money is not making its way back to the Chinese factory, where sweatshop labor conditions unfortunately still exist despite the immense profitability of the product they are producing.
I usually seem very anti-union, but there is a big difference between the UAW extorting ridiculous wages, and Chinese laborers forced to work six days a week, living at the factory, from 7AM-Midnight for a pittance (~$140 a month) under harsh conditions.
17 of these factory workers didn't commit suicide since 2007 because they particularly enjoyed their plight, and it really makes you think when you see how little wealthy manufacturers like Apple are allowing to trickle from the top down.
There needs to be balance.