Apple’s latest Mac Mini desktop computer comes at a premium and bears higher component costs due to the Mac Mini’s use of parts designed for mobile PCs, according to a dissection conducted by iSuppli.

The entry-level version of the new-generation Mac Mini carries a bill of materials (BOM) of US$376.20, which increases to US$387.14 when manufacturing costs are added. This low-end model of the Mac Mini is priced at US$599, reflecting the relatively thin BOM/manufacturing margins generated by Apple’s PCs in relation to its lower-cost consumer items, specifically the iPod line, iSuppli noted.

The total materials and manufacturing costs reported in iSuppli’s teardown analysis of the new Mac Mini mirror only the expenses for direct materials, manufacturing and basic tests. Not included in this analysis are costs above and beyond the material manufacturing of the core device itself including the cost of intellectual property, royalties and licensing fees – as well as those expenses not already included into the per component price, software, software loading and test, shipping, logistics marketing and other channel costs.

“Unlike most desktop computers from other brands, the Mac Mini and, indeed, Apple’s entire Mac line make extensive use of components designed for notebook computers,” said Andrew Rassweiler, director and principal analyst for iSuppli. “This enables the Mini and other members of Apple’s computer line to achieve their very sleek and compact form factors, and to reduce energy consumption. However, the use of these components, along with other cost adders like software, yields a computer that is more expensive to make.”

The Mac Mini’s focus on mobile components starts at the top with the PC’s use of Intel’s Core 2 Duo P7350 processor, which is designated as a mobile chip. The specific Mac Mini torn down by iSuppli incorporated a 2GHz clock speed version of Core 2 Duo P7350, which carries an iSuppli estimated price of US$118.35. The next-level Mac Mini model features a 2.26GHz version of the processor, available from Apple at a US$150 premium in retail pricing.

Another mobile microchip embedded in the Mac Mini is the Nvidia GeForce 9400M graphics and I/O controller hub. Apple commonly uses this same part in its MacBook line of notebook PCs. The Nvidia GeForce 9400M comes in at an estimated price of US$65.16.

Other mobile components in the Mac Mini that command a price premium include the 2.5-inch form factor hard disk drive (HDD) and the slim optical disk drive (ODD). The Hitachi 120GB 2.5-inch-format HDD comes in at a price of US$46, while the Mac Mini’s ODD is priced at US$32.

At a size of 6.5×6.5×2-inch, the Mac Mini is tiny compared to a more full-size desktop tower enclosure, which can be 10 to 20 times larger, not including Apple’s external power supply.

In spite of its use of some mobile components, and the latest energy-saving silicon process geometries, the Mac Mini overall has a great deal of processing power. As a result, it employs a 110W external power supply, representing a higher power usage than the first-generation model, which employed an 85W power supply. This is so despite the process geometry leap from the 0.13-micron technology employed in Freescale’s RISC microprocessor in the first-generation Mac Mini, to Intel’s 45nm process Core 2 Duo used in this most recent generation Mac Mini.

“The new Mac Mini is a more powerful computer than the first-generation model, causing its peak power requirements to rise,” Rassweiler said. On the other hand, the Mac Mini has earned its green designation as it consumes less than 13W when in idle mode.

Another major difference between the new Mac Mini and the first- and second-generation models is the use of the Nvidia graphics controller and I/O controller hub. The first-generation Mac Mini employed an equivalent ATI part. The second-generation Mac Mini also employed an Intel graphics processor. This represents a departure from conventional Intel chipset designs in which Intel provides all of the core silicon and processing beyond the processor.

“Nvidia, as a specialist in the domain of graphics processing and acceleration, clearly enhances the performance of the Mac Mini,” Rassweiler said.

Source: iSuppli, June 2009