Add in the passives and other junk, and leave out the ethernet module and we are talking about a bill of materials of close to $20.
Now add 1.75 for the PCB (qty 5000), 2.50$ for assembly, another $2.00 for testing, packaging and assorted costs (like shipping raw materials and finished goods to and from china, since US assembly and PCB costs are at least 3 times what I noted) and the bare per-unit cost is $25.
Dont forget to factor in costs like - uhh - keeping the lights on in their officepartment - and even if their dev time is free they just cant sell that product for $25 without outside cash subsidizing the whole thing.
In this business, distributors pretty much demand the product at 25-40% discount, so if they want to be in shops and catalogs, you have to factor that in as well.
Consider the raw cost per arduino is probably around 10.50$, they sell 100,000 units a year, and their onboard processor is about 1$ and they have less overall plastic, passives, and other overhead parts than this thing.
Given that Eben Upton is currently a technical director at Broadcom while simultaneously working on this Raspberry Pi project...maybe I'm not so shocked anymore. It's actually refreshing to see chipmakers put out cheaper EVKs to play with instead of $4000 development systems. It's good marketing.
I'd single out TI as the largest culprit of making EVKs hard to get, but I'm also inclined to believe they've been giving Beagleboard/Pandaboard a helping hand (like where can you find loose OMAP4s on the market? I sure can't.)
Note that the OMAPs are trickier as they expose their memory bus above the chip - the SDRAM and NAND are mounted on top of the main die as a stacked BGA. This isn't easy to work with.
[1] https://estore.ti.com/MSP-EXP430G2-MSP430-LaunchPad-Value-Li...
Really? They are 40 cents, in quantities of 1. From Jameco, who are not known for their low prices. [1]
Your $4 for headers is bunk of a similar magnitude.
> I cant find an ARM11 chip for less than 10$ on octopart
This is true, but 500MHz Arm11 chips are only $11 in reasonably small numbers. [2]
I wish I was your supplier - you are putting their kids through college.
[1] http://www.jameco.com/webapp/wcs/stores/servlet/Product_1000...
[2] http://search.digikey.com/scripts/dksearch/dksus.dll?Detail&...
Without breaking down everything piece by piece, we spend about 3.00$ in plastic and other headers on a medium qty design that looks about comparable to what theyre doing (i/o wise). Also, female 1/10" headers are quite a bit more expensive than male, which I think skewed my intuition a bit.