Well according to TrendForce the biggest savings can be made on screens:
“As panels and touch modules together account for 35-40% of the total material costs of a 7-inch tablet, replacing the commonly used 7-inch FFS panels with 7-inch TN LCD panels accompanied by additional wide-view angle compensation could save over 50% in panel costs”
The difference between cheaper TN displays and the FFS (IPS) panels used in current products is the maximum viewing angle of the screen. TN screens tend to suffer from narrower viewing ranges, but benefit from faster response times and less power consumption than their more modern counterparts. It makes sense that TN LCD displays could see their way into tablets as small viewing angles aren’t such a problem on small screens as they are on 42” TVs. The analysts estimate that, by switching to more cost effective display panels, manufacturers could knock about $25 off the cost of each unit produced.
TrendForce also believes that moving towards more budget orientated DRAM components and cheaper NAND flash storage could save a further $10 off the cost of production. These are probably the components which could be changed most easily without the average user noticing any difference. Slower RAM or flash storage may decrease loading or saving times on a device slightly, but nothing which would be noticed on light applications. It certainly wouldn’t be a good idea to cheap out on these components in a high-end tablet or something aimed at more performance hungry applications or games, but in budget tablets this is definitely something which could be compromised on.
The last major cost involved in any type of computer is the processor, and TrendForce believes there’s room for some more savings here as well.
“For CPUs, China-based IC design houses, including Allwinner Technology, Fuzhou Rockchip Electronics, Ingenic Semiconductor, Amlogic and Nufront Software Technology (Beijing), provide 40-55nm-based processors at about US$12 per chip which could be alternatives to chips used in high-end tablets which cost about US$24”
Whilst we probably wouldn’t expect to see higher performance chips like the Tegra 3 in budget tablets, we could see manufactures opt for older, larger chips in order to save a few dollars. Obviously we are looking at lower performance across the board with a slower processor, but tablets using older 55nm chips would also see higher temperatures and excessive power consumption compared with more modern technologies.
So what does this mean for consumers
If we are to see tablets as cheap as $150, there are definitely going to be compromises, that’s a given. You’re probably looking at screens which can’t be tilted too far without losing the image and tablets which might stutter and heat up when watching HD videos or playing games.
Smaller amounts of built-in storage is also a likely compromise, so cheap tablets may become even more reliant on external memory cards. But, for the more casual tablet user, a budget device would still certainly be capable of browsing the web, checking emails and streaming Youtube videos. Who knows, cheaper alternatives might even help drive down the prices of more premium products, which is a win for everyone.
Bottom line, expect more under-$150 7-inch tablets in the coming months.