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Nexus 7 Tablet: Not a Huge Money Maker for Google

By July 5, 2012March 6th, 2023Technology News

The Nexus 7 tablet is the first tablet that Google is branding by themselves, which has already stirred much interest and curiosity around the globe. Recently, the company announced that they will be starting the price out on these tablets at $199 – cheaper than any other tablet of this size on the market.

Analysts have begun to question how exactly Google can make these tablets at a low enough cost to justify the price tag. Many say that the tablet is meant to bring in customers whilst sacrificing the potential profit margin. However, hardware specialists are telling a slightly different story.

UBM TechInsights came up with an estimate on how much Google’s new tablets cost to manufacture: $184 per device. That covers shipping, assembly, and all components of the tablet. The Kindle Fire, which is priced identically to the Nexus 7, makes $46 a piece on their tablets.

Analysts believe that Google is pricing their tablets so low to take business from Kindle and Nook and to establish a market loyal to the Google brand. The company already plans to bring out more expensive, more powerful devices over the next few years and may be hoping to corner the market.

Since Google is paying more for the hardware of their tablets, they are likely more powerful than the tablets at the same price point. This paves the road to success in the lower-cost tablet market.

The Nexus 7 looks quite impressive on paper. With an increased resolution and a front-facing 1.2 megapixel camera that allows for Skype or Google+ chat, the tablet already blows Fire and Nook out of the water. The tablet will also have quad-core Nvidia Tegra 3 technology and GPS features.

Though this speaks well of Google’s future in the tablet market, iPad still has the higher-end tablet market in the bag. A $499 iPad generates $171 in profit for Apple, and no other company has even come close to the sales that iPad has made.

Jason Manteiga

Jason J. Manteiga, Vice President of Olmec Systems, has been part of the company for over the past 20 years. He believes that having a great work environment and supportive team, is the ultimate key to success. Since being in the IT realm for over 25 years, Jason, along with Olmec Systems, has been on the Inc. 5000 “List of America’s Fastest Growing Private Companies” and Channel Futures MSP 501 “Top Managed Service Providers in North America,” along with other awards and nominations. Jason earned his Bachelor Degree in Information Systems from the New Jersey Institute of Technology. He also holds certifications in Microsoft MCSE, VMWare VCP, and Cisco CCNA. In his spare time, Jason is a contributor for The Center for Social & Legal Research (Privacy Exchange) and a member of the Morris County Chamber of Commerce. His hobbies include cycling and kayaking. He currently lives in New Jersey with his wife, two daughters and son.