Austin Techies Make Living Disassembling iPhones, Other Gadgets

AUSTIN, Texas (Austin American-Statesman/MCT) -

When Apple Inc. set off a frenzy on Sept. 19 with the debut of its iPhone 6 and 6 Plus, workers from Teardown.com lined up at 5 a.m. at stores around Austin, Texas, to buy three devices.

Then they returned to the company’s offices, where engineers began disassembling the new Apple products.

“We took a screwdriver and tore them apart,” said Sean Bridwell, Teardown.com product analyst. “We wanted to know every detail of everything that’s inside: who the supplier was for every component, wire and screw; and how much it cost to make.”

Over the next 12 hours, the battery, cameras, display, materials and electronics were analyzed and priced, and the information was rolled into a spreadsheet.

The “quick-turn” report was shared with Teardown.com’s clients, who include tech manufacturers, financial investors looking for market trends and resellers who want to know how much individual parts cost. Attorneys use the reports for patent-infringement cases and engineering teams study them for design ideas.

Five weeks after the quick-turn report, Teardown.com issued a “deep-dive” with photos, measurements and weights of each component and the maker of each part. It also shared the new technologies involved in manufacturing it, including the new integrated circuits.

Also included was the cost analysis for materials and final assembly: $222.62 for the iPhone 6 model and $244.75 for the iPhone 6 Plus, compared with retail prices of $199 and $299. (Apple makes up for the loss by selling service applications integrated into the phone as well as cellular-service subsidies from the carrier.)

Over the past 15 years, Teardown.com has broken down more than 2,000 products, including tablets, digital cameras and camcorders, notebook PCs and gaming consoles.

The company was started as a research program by the now-defunct microchip consortium MCC. Its initial mission was to provide technical analysis of consumer products to MCC’s member companies.

In 2000, it spun out of MCC into a company called Portelligent. Seven years later, it was bought for $8 million by United Business Media, a United Kingdom-based media company.

Today, Teardown.com, which has 12 employees in Austin, 10 in Poland and three in Ottawa, is part of Axio Data Group, which is owned by a private-equity firm.

Teardown.com doesn’t disclose its customers, but says it has hundreds of subscribers worldwide. They range from one-time users who pay $1,200 for a single report to annual subscribers who could pay up to $70,000 a year for full access to the company’s data.

The Teardown.com team also does custom reports, and some customers pay to have their own products dismantled. “We can give them an unbiased account of what we’re seeing,” said Stacy Wegner, Teardown.com product manager. “They want to know how much they should be paying for parts and how much they should be charging.”

Competitors include Chipworks, based in Ottawa, and New York-based ABI Research, as well as blogs and tech-industry publications that have their own teams who “unbox” products.

Bridwell says Teardown.com sets itself apart by providing more depth, including Excel spreadsheets that track thousands of data points in a single product. The spreadsheet allows customers to price out individual components or insert their own data to experiment with pricing.

Now the company is breaking into new markets, including automotive — it’s currently analyzing modules in the BMW i3 — as well as wearable technology such as the Jawbone UP24 and smart home technology including devices and sensors.

Every product the company has dismantled, dating back to the first digital music players and GPS devices, is stored away in individual plastic containers in the company’s morgue.

“The room is stacked from floor to ceiling — just walking around gives you an idea of how fast technology has changed,” said Tim Maté, Teardown.com product engineering analyst.