Apple Vision Pro's components cost $1,542–but that's not the full story | Hacker News Reader

Apple Vision Pro's components cost $1,542–but that's not the full story

arstechnica.com

50 pointsmpweiher83 comments

>A bill of materials like this doesn't take into account manufacturing, shipping, or marketing, nor does it factor in the cost of research and development.

it also (likely) doesn't take into account the massive discounts you get at scale and Apple's famously optimized supply chain. I wouldn't be surprised if the real BOM is sub 1K.

I'm not so sure. Taking the displays at $228, these are specialist components that require integration work – I don't think one can walk into the Sony offices and ask to buy one (1) of them. That would then suggest that the "sticker price" is accounting for a certain level of scale, and while Apple are high volume in general, this device is not particularly high volume. Also volume discounts on components such as this don't tend to be that significant as to achieve a 33% reduction on price.

Isn’t that this company’s entire business? I’d be surprised if they were anywhere that far off on the first question most people would have, and most of those parts are quite specialized so you aren’t going to see volume discounts unless the market grows significantly.

The Vision Pro doesn't exactly seem to have reached what I would normally think of as mass production so I wouldn't be surprised if the scale doesn't really work for them yet.

That said, with raw numbers like this I always have to think of the teardown of the Juicero which revealed that it used numerous custom parts that certainly made it very expensive to manufacture: https://blog.bolt.io/juicero/

The catch with Juicero of course is that while the parts were very expensive, it could have been made much cheaper by using standard parts instead of the custom ones. I'm not saying that's the case here but it's worth taking these things with a grain of salt.

Some economies of scale take effect not with the scale of production but with the size of the business. And Apple is as big a business as any.

It’s also a trade off balance - if you use custom parts you can make them “all perfect” and save money at volume - if you use standard parts you save money at the beginning but often have a larger product than otherwise.

Apple obviously had some serious discussions on this and came down on the “customize to make it the best we can” and “don’t subsidize it at all” - unlike how some consoles were done.

It’s their job to take these things into account. This is a brand new, low volume product. The supply chain isn’t yet heavily optimized and there are a lot of tooling and NRE costs to make up.

Even if the BOM was $1K, that’s right in line with the standard 3-4X retail price multiplier expected for hardware products.

A lot of people have told me they'll buy it when it gets down to around $1,000 and I just don't see a way to get there from here.

You can drop the second display, make the frame out of cheaper parts, that gets you down to what -- $1,200 in costs? Maybe they get the cost of the chips down? I don't think they'll ever use a cheaper main display -- if anything they'll just keep improving the quality. I don't see this going below $2,000 any time soon.

Lots of people would probably pay 2k for a much better headset too. There are multiple ways Apple can attack this.

I think the main reason that they aren't going to focus on cost reduction is that it's not really good enough right now. The people that won't buy it at $3500 won't buy it at $2000, either. Anything north of $1,000, if you're not just selling it to ultra wealthy people who don't care about money, it's got to be a core part of their existence like a phone is, or their job is paying for it. And I don't think the product, as it is, is that. A lot of people wouldn't use it if you gave it to them _for free_.

Unless they can come up with financing options. A lot more people might be willing to pay $150 a month for a new VR headset every couple of years.

If you have a small apartment but enough disposable income to drop $2000 on a TV-set (common situation) I can see it be compelling.

Can't watch it with other people though. Still need to strap a heavy headset to your face instead of just clicking a button to turn the TV on. I'd still rather have a TV than Vision Pro.

I would pay $2,000 for great AR/VR glasses - not goggles like the Vision Pro or Quest. Something like the XReal Airs but higher resolution.

Why Apple didn't work on this category - glasses - and instead worked on VR goggles, which for years have already been a niche for gaming (something Apple sucks at), is beyond me.

The reports a year ago were that this was their true goal, but they had to postpone AR glasses due to "technical challenges". The Vision Pro was the fallback product that let them enter the market years ahead of where they otherwise would have been able to.

1: https://www.reuters.com/technology/apple-indefinitely-postpo... 2: https://www.bloomberg.com/news/articles/2023-01-18/apple-pos...

A side note: it might still be valuable for developers to get one of these -- if we believe that Apple can eventually produce those glasses, I'd assume that experience in developing apps on Vision Pro is still valuable.

> Why Apple didn't work on this category - glasses - and instead worked on VR goggles

Probably because it's a fantasy that can't exist with current technology.

It already exists: https://www.xreal.com/us/

I don’t think they’ll lower the price for Apple Vision Pro, but if they can get good performance out of cheaper components they might release an Apple Vision Air I guess. Not happening anytime soon though.

It's such a niche product with no real world applications. Keep it expensive; no big deal.

Well, there's a vicious cycle with this sort of tech.

When sales are low, nobody releases great new applications for it. When nobody releases great new applications for it, sales stay low.

Apple needs to release a killer app.

If even they can’t, then they have a serious problem.

Only Apple can release apps for this because no one else can justify the lost revenue that Apple takes off the top in fees.

Nah, people have been building amazing content for VR headsets since the 80s. i used to use them in arcades and companies toured devices and content across college campuses in the 90s and we've had Quest for a decade with 6 million MAU today so there's plenty of attempts and it all falls short of mainstream value. Useful for gaming and some VR porn and that's about it. No strap-on dorkbox face computer will ever take off for productivity, not as long as half of office workers spend huge amounts of time on hair an makeup to look nice at the office. No chance they're gonna muss that all up to get another couple screens at their desk when they've got desktops, laptops, tablets, and phones already.

> face computer will ever take off for productivity, not as long as half of office workers spend huge amounts of time on hair an makeup to look nice at the office.

The hair and make-up thing seems like it'll be a thing. But the main thing is that it's just not a productive interface. It might be, eventually... but I doubt it. There's very little usability gain in distributing most "work" data in 3d like this. Most of us rarely need to track or navigate around three dimensions of data in real time, and when we do, 2d projections are usually enough.

For comparison, Macbook Air starts at 13" $1100 or 15" $1300. iPad Pro is $800 or $1100 depending on screen size. Both have M2 chips, like the Vision Pro.

Functionality wise Vision Pro is a lot closer to an iPad than Mac, but it's also a lot 'higher tech' than either of them.

There's no way even a cheaper variant is priced under iPad.

Why do you think it is "higher tech" than a laptop?

it is more advanced technology. E.g. the exceptionally dense resolution displays, compared to the displays in laptops. All the sensors and eye and hand tracking.

Lots of development cost, in other words, that needs to be amortized.

Top of the line displays, not one but two advanced CPUs one of which is brand new, a smorgasbord of sensors…

Huh? $1542 of BOM for a relatively low-volume, first-gen product is actually quite low.

With volume, scale, and manufacturing improvements, there is certainly room to keep the same quality and parts and get it under $500 BOM. I'm sure. But you'll need to wait a couple years.

My first 4K monitor costed me $2k maybe a decade ago. Today, I can get a better one for $350.

yes in a decade they can sell the AVP for $500 and not lose money. in a decade the AVP will be a joke and we'll have abandoned this nonsense once and for all (except for the actually useful gaming and porn applications.)

Why don't they just buy a Meta Quest 3?

No Apple logo.

Requires having an account with Facebook.

Because the screens are shit, comparatively. Also the OS is years behind.

the smearing with any head movement on the AVP and the glares or flares or whatever those are have made it unsuitable for movie watching for my movie buff friend who got it because of the "better" screens. He's back to his Quest.

Ultimately the Quest is designed as a VR game console and it does that well for an affordable price, but it’s the AR aspects of the Vision Pro that people are excited about.

Head to head the Meta Quest 3 has worse screens and cameras, only runs one app at a time, requires controllers, less comfortable while reclined etc. And while Meta removed the mandatory Facebook integration that really damaged people’s perception of the brand.

In the end more affordable products sell, but people still lust after supercars not daily drivers.

> mandatory Facebook

That was the reason I was never going to touch any future Oculus product but I didn’t realize they dropped that requirement until now.

> worse screens

Reviews that I've watched have pointed out the woeful FOV. Pixel density appears higher due to being spread over fewer arc-seconds. Further, inadequate FOV will ruin any advantages gained by superior panels. Apple really botched that one.

> less comfortable while reclined

Reclining is likely the only comfortable position for the behemoth.

The Quest loses out on some specific points, but wins holistically. It's the 3rd iteration of the HMD, Meta have learned which compromises matter.

Then there's the vast $1000 Valve-compatible ecosystem where consumers can pick and choose what compromises matter to them. Not caring about AR frees up a lot of room for other improvements, for example. Skipping the uncanny face sheds a lot of weight and fragility in terms of glass. Using plastic might feel less premium, but premium weight is the last thing you want hanging off the front of your head.

Reviews have remarked on it but I don’t think anyone I’ve seen have complained that it’s a problem. Its other features make up for the FOV shortfall. And lord knows it has other issues too that are probably more important than the FOV

The Meta Quest 3 screen has 1/5 the number of pixels. (4.5 million vs 23 million) It’s still absolutely a better game console and that’s where FOV shines, but the general consensus is the Vision pro has much better screens for consuming content:

https://www.cnet.com/tech/computing/meta-quest-3-vs-apple-vi...

“For playing movies, personal videos, or basically any video, Apple's Vision Pro is a revelation. If you can find a comfortable fit for the headset, its displays create a cinema-like experience. The Quest 3 can also play videos, but the experience is night and day. The Quest 3 display is acceptable for video, but worse than my phone or iPad. The Vision Pro, meanwhile, is better than my TV. Movies feel special. My own videos look good.”

Not what I'm hearing from people who can't stand the smearing if they even move their head slightly, and the bad flares or glares watching any dark movies makes it useless for a cinefile friend.

Ask your cinefile friend to watch a movie on a Quest 3 for comparison its issues are even worse by comparison.

While there is some overlap in capabilities between the two, Quest 3 is essentially a game console while the Vision Pro is clearly targeted more at productivity.

My 12-year old son recently got a quest 2, and loves it. The killer feature is playing games with live audio with his friends. He comes out of the room sweaty and exhilerated.

I've been amazed by it. I had earlier headsets that required a cable to a PC and base stations mounted to the walls. Although beat saber was fun for a while, I pretty much gave up on it.

But the social aspect of the quest 2 seems really great for a 12 year old boy so far.

>But the social aspect of the quest 2 seems really great for a 12 year old boy so far.

Plus the health benefits of standing and moving around instead of gaming hunched over the controller from the couch/bed.

The Quest kind of made me give up on PC gaming and pick this up instead.

You're right that Vision Pro is clearly targeted at productivity.

But is that because it's good at productivity? Or is it just that Apple doesn't have any market share in (non-mobile) gaming, so they knew if they targeted gaming the product would be a guaranteed flop?

It's because apple can't get games or gamers so productivity is all that's left and productivity means office workers, half of whom wear makeup and spend time on their hair and aren't about to wear a strap-on dorkbox that weighs 1.5 pounds and destroys the effort they put in before going into the office.

But there's no one who does productivity today who's gonna trade their laptop for a VP and there won't be for decades because strap-on dorkboxes that mess up the hair and makeup of half the productivity population, something they put effort into before going in to the office, is a non starter for like 99% of them.

They might carry on improving the quality for the Pro (although this also has limits and diminishing returns) but they don't need to do that if they're targeting a sub $1000 headset, they just need to make these screens cheaper.

They'll keep improving the quality for the top end product, sure.

But screens with today's quality will fall in price over the next few years.

Apple loves putting tech they have already paid the initial manufacturing scale-up costs on into lower tier products.

Why is that important? If you go to a Michelin star restaurant, the input costs are lower than what you pay. But the value is in the creation. The experience itself is valuable. There goes a lot into building a device. More than its parts.

The thing is getting an Apple device to use is not as exciting as say 10 years ago. The hype is still here but not that big.

Sony has a monopoly and limited production on MicroOLED, which is why the displays are the most expensive part of Vision Pro.

Apple is reported to be testing displays from BOE, Apple will be able to negotiate better prices once Sony loses their monopoly.

If Vision Pro 2 is planned for 2027, we might see Apple use Samsung eMagin OLED.

BOE and Samsung and Japan Dispay are in market or ramping now.

Also one big thing that is often overlooked is aftersales.

I think Apple products are often overpriced, but using the BOM to estimate margins is kind of stupid.

That's a good point for other Apple products, but in this case, many other companies are not supporting the "platform" (Netflix, Spotify, YouTube); this may diminish the LTV of Vision Pro and its successors. I mention successors because the obvious next step is to put a $600 fancy detachable headband on an iPhone and call it Apple Vision (not pro).

It may be that Apple's abusive track record in the App Store ends up getting them locked out of whatever the next thing is since it's clear that gated, extractive monopolistic practices are core to their identity and business model.

It's interesting to compare this to the aggressively priced Meta Quest 3, which sells for $500:

> they estimate that the components of the Meta Quest 3 alone cost an estimated $398 per headset. Combined with manufacturing costs, the price should be around $428

https://mixed-news.com/en/meta-quest-3-bill-of-materials-ana...

> In its fourth-quarter earnings report Thursday, Meta said its Reality Labs unit recorded an operating loss in the period of $4.65 billion.

https://www.cnbc.com/amp/2024/02/01/metas-reality-labs-loses...

The analyst firm seems like they specialize in display panels, electronics etc. so it makes sense that their BOM breakdown doesn't include all the other (quite expensive components) that go into the device.

So this number isn't "wrong" so much as specialized.

What would the cost be if the designers hadn't wanted to play with curved glass?

Would the product be that different without the glass front and second screen on the front? Would it have actually been better because it would be lighter, cheaper and with better battery life?

> Would the product be that different without the glass front and second screen on the front?

Well, the article has the cost savings at under 5%. Battery would probably be more but I’d be quite surprised if it was a game-changer: the processing needed to make XR work is just expensive and Apple has one of the best design teams in the industry so we can safely assume that they wouldn’t have missed an opportunity for a notable battery life improvement.

I wonder how they got that $240 figure for SoC, I would have thought the marginal cost of a chip to be much much smaller? Of course attaching any price tag to in-house part is going to be problematic.

That’s basically the problem with this kind of analysis, these are basically guesses, the real cost for that and any of the custom components could be 50% less or 400% more…

What costs are they assuming is included in the BOM cost of the SoC? Mask sets and manufacture? NRE or no NRE? All of this makes a huge difference, but they don’t actually know what Apple pays for any of it…

An SOC that Apple's selling at massive volume too via iPad or some other device, right? So no one can blame the hundreds of thousands, low volume of AVP for that steep price.

Apple was ahead of the curve and influential in the 2000s, but today, they seem to have run out of steam. They just released a $3500 head VR headset that has no purpose and is searching for a problem to solve and which is DOA for at least 5 more years and they are years behind the others in LLM's, which is literally changing the world akin to the iPhone. The company is so inert that they can't even get the Apple Car out.

Frankly, Apple's current market cap baffles me. While Tim Cook is a competent manager, he doesn't quite match up to Satya Nadella. Satya consistently stays ahead of the curve, reminiscent of Apple's prowess in the 2000s. He dissolved Microsoft's AR/VR division months before the explosion of ChatGPT and LLMs and redirected Microsoft's focus to fully embrace LLMs. Managing a colossal company like Microsoft, it's truly impressive how swiftly he can pivot its direction.

In contrast, Tim Cook appears more like a Sundar Pichai-style CEO, adept at weathering storms and maintaining stability. Investors are taking notice, and that's why Microsoft has not only maintained its position but surpassed a $3 trillion valuation, while Apple has faltered. I wouldn't be surprised if Nvidia eventually surpasses Apple in value too.

Microsoft's comeback in recent years has been very impressive to witness. Although I still can't make the jump to Windows, I'd at least be open to it at some point. Last time I booted a Windows machine, it showed me an ad on startup. Get rid of shit like that and I'll consider it.

If you live in the EEA you'll soon be able to get a de-crapified Windows 11 direct from Microsoft: https://arstechnica.com/gadgets/2023/11/europeans-can-soon-s...

That shit is their bread and butter, though. They will literally never get rid of it, they've spent the past 5 years doubling down on that, and then doubling down on it again.

Their message is clear: if you don't like it, fuck off.

I have to have one Windows machine for certain shit, and while you can get rid of a lot of the ads only once, certain ones, like in-UI ads for Microsoft Teams, just keep coming back like Terminator. There's no way to get rid of them. At best, you can get rid of this specific version of the ad, but they will add a new "different" one in the next OS update.

But Apple is on their six. My kids recently got old enough to need their own accounts on computers, and it is this hellish whack-a-mole with ads for Apple Music.

Even though I think Apple is about as good as we'll ever get from a for-profit corporation, it's still deplorable. You will never not get ads if you cede control of "your" hardware to some corporate jackasses.

90% of teenagers in the US use iPhones at this point. Under him, AirPods have grown into what could be a wildly successful company completely independent from Apple. They make the best selling watch in the world, and pretty much the only good smartwatch in general. And Apple Silicon laptops have made such an embarrassment out of everything else on the market, that unless you have some specific usecase that requires x86 or Windows compatibility, there's basically no reason to buy anything else.

What else do you want him to do? We haven't had a big innovation in technology since the iPhone, and the iPhone has iterated into what is basically perfect with the current form factor. In the Android world there's folding phones, but materials science hasn't solved the issue where the screens spontaneously develop fractures across the fold line at such a high rate that I wouldn't recommend anyone buy one unless you're fine with the constant risk your phone very well might put itself out of commission and need repairs for no fault of your own.

If the Vision Pro ends up failing, it doesn't suddenly make everyone's iPhone or MacBook or AirPods worse. I really don't understand this mindset.

Tim shipped a few accessories for Steve's creations. I expect you could have pulled that off. The Apple janitorial services manager could have.

Presumably they are also paying to license third-party patents and other intellectual property for each headset.

Honestly the whole concept of having 2 screens, one showing you what’s directly behind it and another one showing the other person your eyes (also directly behind it) seems so wasteful.

There needs to be some technology advancement where you can overlay all the safari windows and apps onto a real see-through screen before this thing gains any real traction. This way you could get rid of 2 screens, a bunch of cameras, a dedicated chip that does the pass-through, the battery pack, half the weight and half the cost (or more).

I believe Meta is trying something like this with their Ray Ban glasses.

These comments will probably be quite amusing in 3-4 years time.

how so?

No wireless. Less space than a nomad. Lame.

But it could also be a quiet flop if they never get any traction because of a lack of apps.

A picture from Rubens is only 100$ in Materials, but this is not the whole story ;)

In case some still haven't realised, Apples has become mostly a status brand.

Not an innovative, way ahead in quality maker. With a good touch of status. That flavour mix has died long ago along with Jobs.

What's left is a money making machine sitting on its legacy. They are in the prada, gucci business. And have more cash in hand than most fortune 500 have in yearly revenue. Even if some combine.

They can launch series of product that flop. They can RnD many cool things catering to the very rich, break even. At loss even.

They could make new generations vision thingy with a 3k or more market, and at loss, at profit anyway in the end by selling specialised apps for other thousands of dollars a piece to feed the 0.01%, those are running out of ideas on how to spend their money.

Apple is the shadow of itself 15y back, but got the power to continue surfing on that market for status money making business for years.

Their products are still far and away better quality wise than most other brands though.

> In case some still haven't realised, Apples has become mostly a status brand.

Yet they sell a phone that generates revenue for them and don't have to sell all my personal data to advertisers.

Apple has a multi billion dollar advertising business. What makes you so sure they don't use personal data for ads.

Wow, I am not sure how anyone can seriously write this without doubting himself even once.

I get it, you provably not their user, but you can at least appreciate that people are using Apple not only for the status.

My parents are using iPhones after so many android phones and cannot be happier. My mother is using iPad with keyboard after abandoning laptops and PC and couldn’t be happier.

We use Apple in my family, because of the tight integration and ecosystem. We can share photos and videos easier than ever, FaceTime, collaborate, etc… Even new feature with desk sharing in FaceTime is amazing and allow me to help my kid with homework from far away.

My M2 Macbook Pro is the best laptop I’ve ever owned by high margin.

Tight interaction with iOS devices, Apple TV and Homepods is just amazing.

In your world Apple is a status symbol, but in mine - it solves real problems for my whole extended family. Not everything is perfect but saying what you’ve said is just ignorant.

> In case some still haven't realised, Apples has become mostly a status brand.

People have been saying that since the 90s. You’ll need to show your work if you want to be taken seriously.

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