Google Inc.'s new Nexus 7 tablet is the same size and price as Amazon.com Inc.'s Kindle Fire, but it costs a bit more to build.

 

Research firm IHS iSuppli took apart the Nexus 7 to analyze its components and found the hardware costs $151.75 for the low-end, eight-gigabyte model, a slim margin given the device's $199 sale price.

 

But the 16 GB model, which sells for $249, costs only $7.50 more to build for a total of $159.25, the difference being the price of memory chips inside.

 

Andrew Rassweiler, who leads the teardown team at IHS iSuppli, reckons that Google will break even on the 8 GB model but turn a tidy profit on the 16 GB model.

 

'Like Apple, Google realizes it can boost its profit margin by offering more memory at a stair-step price point,' Mr. Rassweiler said.

 

All told, IHS iSuppli figures Nexus 7's 8 GB version costs about $18 more to make than the Kindle Fire, which only comes in one version with 8 GB of memory.

 

But that difference could change soon. Amazon is slated to debut a new Kindle Fire with a better, and likely more expensive, display.

 

By comparison, Apple Inc.'s least-expensive version of the new iPad with 16 GB of memory sells for $499 and costs about $316 to make, according to a previous IHS iSuppli estimate.

 

The Nexus 7 cost estimate is about $30 lower than an early estimate put out last month by another research firm, UBM TechInsights. However, UBM's estimate was made without having first obtained the hardware for analysis.

 

The Nexus 7 is similar to Amazon's Kindle Fire tablet in many respects, but it also has a few more robust features.

 

For one thing, the Nexus 7 has a Tegra 3 processor from Nvidia Corp. as its main computing engine. It is a four-core chip, meaning it has four main processing brains, two more than the Kindle Fire's processor from Texas Instruments Inc. TI, however, supplied two chips for the Nexus 7, one a power-management chip, the other a low-voltage transmitter.

 

The Nexus 7, manufactured by Asustek Computer Inc. for Google, also has a higher-resolution display at 1,280 pixels high by 800 pixels wide, versus 1,024 by 600 for the Kindle Fire.

 

Mr. Rassweiler said the display uses a technology known as in-plane switching, andadded $38 to the hardware cost of the Nexus 7, versus $35 for the display in the Kindle Fire.

 

The Nexus 7 also has a camera that added $2.50 in cost, and which the Kindle Fire lacks.

 

And the Nexus 7 has a chip from NXP Semiconductors NV that supports near-field communications, a close-range wireless technology that is intended for wireless commerce transactions. Broadcom supplied GPS receiver chips to support mapping functions.