In the last one, we touched on how the iPhone 14, which came out in 2022 powered by the A16 chip, still costs north of $400, while a brand-new iPad with the same chip is cheaper.
Tablets are often cheaper than smartphones despite using more material and, in many cases, similar hardware (such as the chip in the example above) due to a few key factors:
Market Priorities & Demand
Smartphones are in higher demand and are considered essential daily devices, so manufacturers invest more in R&D, design, and marketing, which raises costs.
Tablets, on the other hand, have a smaller market and are often seen as secondary devices, leading to lower pricing strategies to attract buyers.
Less Advanced Components
Even when tablets use the same chips as smartphones, they often use lower-cost displays, cameras, and build materials.
In the iPhone 14 vs. iPad A16 case, although they use the same chip, the one in the iPad has one fewer CPU and GPU core.
Smartphones prioritise high-end OLED displays, advanced cooling, multiple high-quality cameras, premium materials (e.g., glass, aluminium), and more compact engineering, all of which drive up costs.
Tablets, in contrast, often use cheaper LCD screens, plastic bodies, and lower-tier camera systems since they are not as camera-centric.
However, even when tablets use premium materials and good displays like the iPad, those other factors help keep prices down.
Fewer Features & Connectivity Options
Many tablets lack cellular connectivity (or offer it as an expensive add-on), reducing the cost of modems and antennas. Side note: This lack of a modem also helps explain why they have excellent battery life.
Tablets also tend to have fewer sensors (no proximity sensor, fewer accelerometers, no advanced facial recognition, etc.).
Battery & Cooling
Tablets have more space for larger batteries, reducing the need for expensive battery miniaturisation and advanced fast-charging technologies.
We don’t usually think about it, but one of the biggest cost drivers for smartphones comes from the challenge of shrinking computer components to fit into your pocket computer.
Tablets also have more space for passive cooling, eliminating the need for specialised cooling solutions like vapor chambers found in high-end smartphones.
When Samsung launched the Galaxy S25 Ultra, you saw how proud they were of their 40% larger vapour chamber, which helps keep the phone cool even when being pushed hard.
They don’t have to worry about that kind of work on their tablets, which have enough surface area to effectively shed heat without the need for special vapour chambers.
Longer Product Cycles & Less Innovation Pressure
Smartphones see annual refresh cycles with significant R&D investments in new technology (cameras, AI features, chip improvements).
Tablets have longer update cycles (Apple’s iPads and Samsung’s Galaxy Tabs don’t get refreshed as frequently), meaning lower R&D costs.
However, seeing as their phones are barely getting meaningful yearly updates, this argument is getting weaker by the day. Samsung has had pretty much the same camera hardware on its flagship phones for years.
Pricing Strategy & Margins
This one is infuriating, but it’s the truth. High-end smartphones have a huge profit margin because manufacturers know people are willing to pay more for flagship phones.
Tablets are priced more competitively, especially in the mid-range and budget segments, making them more affordable. If the demand for tablets grew, prices would rise too. And here we thought those supply and demand curves were just theoretical.
Economies of Scale
The smartphone market is much larger, but each model requires more refined manufacturing processes.
So, although you would expect the costs to be lower per device for smartphones because the fixed costs are shared among more devices, the more intricate manufacturing process has something to say about that.
When you also consider that tablets often reuse older components and have less pressure to stay cutting-edge, you find that it allows manufacturers to keep costs low.
Crazy, isn’t it?
Even though tablets use more material, the lack of premium components (e.g., flagship-tier cameras, compact miniaturisation, high-end displays, and modems) makes them cheaper to produce.
Smartphones are high-demand, high-margin devices that are designed and priced accordingly.
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