IPhone 4’s parts cost more than Droid Incredible’s

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Customers can buy Apple’s iPhone 4 or HTC’s Droid Incredible for the same price, but the parts that make up the HTC smart phone cost about $18 less than the parts in its competitor, according to two reports from hardware analysis firm ISuppli.

The Droid Incredible, a Verizon Wireless phone designed for Google’s Android software, costs $163.35 in parts, the analysts found after a three-month dissection and examination period. Factoring in manufacturing, the total cost is $172.25.

ISuppli’s final iPhone 4 analysis pegs the price of parts at $181.85, with a total cost to make of $189.41, said a spokesman for ISuppli, which employs about 120 gadget experts with ties to the manufacturing industry.

These prices don’t take into account shipping, software development, patent licensing or advertising.

Ad spending is a major difference between the two businesses. Apple takes on much of the financial burden associated with marketing its products, even for the iPhone, which is available exclusively on AT&T. Meanwhile, HTC has been aided by the advertising might of the Droid campaign, which belongs to Verizon.

But HTC has struggled to keep pace with product demand, amid shortages of the high-contrast AMOLED screen the Incredible sports, and Verizon has begun to shift its attention to Motorola’s Droid X.

Apple’s and HTC’s stocks have each made gains since their signature $199 smart phones launched. Taiwan-based HTC skyrocketed this month, with shares increasing about 30%. On Thursday HTC reported a 33% increase in profit for the second quarter.

Several factors could explain why the pieces in Apple’s device are more expensive than HTC’s.

Sure, the Droid Incredible uses a younger screen technology that’s in high demand, and has a higher-quality camera on the back. But the iPhone 4 uses an industrial-designed steel frame (which doubles as an antenna), a higher-resolution screen, a proprietary processor, a second camera on the front and a thinner body, requiring more compact organs.

-- Mark Milian
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