At the launch of the Nexus 7 tablet, Google had notably claimed that it wouldn’t be getting any profit margin on its Jelly Bean tablet. According to the folks at Fudzilla, Google is hardly exaggerating, at least when it comes to the 8 GB variant of the Nexus tablet.
There have been plenty of budget Android tablets which have come and gone in the last year or two. Most notable among them was (is) the Amazon Kindle Fire.
A smart price tag ($199) combined with decent hardware and a great content ecosystem made the Fire a worthwhile option for most tablet buyers on a budget.
The Google Nexus 7 tablet, however, takes the idea of a quality pocket friendly Android tablet to a whole new level entirely. Plenty of more expensive and snazzy names in the tablet market have inferior hardware to the Nexus 7, but often cost more than double the price of new Google tablet. Long story short, there simply isn’t a better tablet in the market now that offers the same kind of value for money.
But the powerful hardware comes at a cost, literally. Fudzilla estimates that the Nexus costs $184 to produce. This figure is just the manufacturing cost, and there are bound to be more costs added up thanks to logistics and Google’s promotional efforts for the Nexus. If you compare it to the Kindle Fire for instance, this entire issue falls into perspective. The Fire’s cost came to around $185 for manufacturing, and $201 taking all factors into account. In short, Amazon sold its $199 tablet at a loss of at least $2, and Google seems to be going down the same path of prioritizing volume over anything else, and hoping that content purchases from the Google Play Store compensate for its losses.