Google Nexus 7 Front

Google's forthcoming Nexus 7 tablet's two models (8GB and 16GB) are set to retail for both $199 and $249, but exactly how much does it cost to build? A recent teardown and analysis performed by IHS iSuppli reveals Google's first entrant into the tablet race costs around $151.75 (8GB) and $159.25 (16GB) to build. The major difference between the two is the cost of memory chips.

Andrew Rassweiler, who leads IHS iSuppli's teardown team, suspects that Google will break even on its entry-level 8GB model, while turning a small profit on its 16GB model. "Like Apple, Google realizes it can boost its profit margin by offering more memory at a stair-step price point. It's getting $50 more at retail for only $7.50 more in hardware cost, which sends $42.50 per unit straight to the bottom line," Rassweiler told AllThingsD.

Revealing the approximate costs of building a Nexus 7 tablet, the teardown also notes similarities with its future sparing partner, Amazon's Kindle Fire. The big differences between the two are the devices' processors and screens. The Nexus 7 features a quad-core Nvidia Tegra 3 processor, while the Kindle Fire ships with a dual-core OMAP 4430 chip made by Texas Instruments. As for the devices' displays, the Nexus 7's screen sports a 1,280 x 800 resolution, while the Kindle Fire features a lower 1,024 x 600 resolution display.

Those specification differences may soon be changing, as Amazon is expected to release a follow-up to the Kindle Fire in the not so distant future. The question is, will the Amazon's new tablet pack enough heat to take down the search giant's latest effort?

[via: AllThingsD ]