the iPod and the global train

June 28, 2007

Great article in the Times today. It follows the complex assembly of the iPod around the globe. In our flat world, it’s important that we are able to think interdependently on a worldwide scale. The iPod is a very workable metaphor for the body of Christ: the Church. It isn’t created in Tennessee and then shipped to the rest of the world. It takes the world to be the church. Kennon Callahan wrote: “God is in the world. When the church is in the world, God is in the church. When the church is not in the world, God is in the world.” iPod.

Here’s a bit from the article:

The retail value of the 30-gigabyte video iPod that the authors examined was $299. The most expensive component in it was the hard drive, which was manufactured by Toshiba and costs about $73. The next most costly components were the display module (about $20), the video/multimedia processor chip ($8) and the controller chip ($5). They estimated that the final assembly, done in China, cost only about $4 a unit.

One approach to tracing supply chain geography might be to attribute the cost of each component to the country of origin of its maker. So $73 of the cost of the iPod would be attributed to Japan since Toshiba is a Japanese company, and the $13 cost of the two chips would be attributed to the United States, since the suppliers, Broadcom and PortalPlayer, are American companies, and so on.

But this method hides some of the most important details. Toshiba may be a Japanese company, but it makes most of its hard drives in the Philippines and China. So perhaps we should also allocate part of the cost of that hard drive to one of those countries. The same problem arises regarding the Broadcom chips, with most of them manufactured in Taiwan. So how can one distribute the costs of the iPod components across the countries where they are manufactured in a meaningful way?

the rest.

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