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iPad costs $229 to produce, says iSuppli

Media members try out the new "iPad" during the launch of Apple's new tablet computing device in San Francisco, California, January 27, 2010. REUTERS/Kimberly White

SAN FRANCISCO (Reuters) - Apple Inc’s forthcoming iPad tablet computer will cost as little as $229.35 for the company to produce, according to an estimate on Wednesday from research house iSuppli.

The group conducted what it called a “virtual teardown” of the iPad, since the device is not yet available and component suppliers have not been announced.

Apple’s iPad, which resembles a large iPhone and uses the same operating system, will go on sale as early as next month, as the company looks to define a new category of mobile devices.

For the $499 iPad -- the lowest-cost model, which features 16 gigabytes of flash memory -- iSuppli estimated the total materials cost at $219.35, with a $10 manufacturing cost.

The priciest iPad will cost around $335 to produce, while the mid-range model will cost roughly $287, the group said.

The most expensive component in the iPad is the 9.7-inch display and touchscreen, at an estimated cost of $80, according to the estimate.

Analysts expect Apple to ship somewhere between 2 million and 5 million iPad units in the first year.

Reporting by Gabriel Madway; editing by Andre Grenon

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