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Manufacturing and material costs add up to $173 for each 3G iPhone, analysis firm iSuppli Corp reports. That's 35 percent and $92 less than iSuppli estimated it cost Apple to build the original iPhone last year. Credit Apple CEO Steve Jobs' sharp elbows with component suppliers, who's price cuts account for most of the decrease. Expect that overhead to drop, and margins to rise, when Apple can being leveraging PA Semi-designed chips in the devices. (Photo by AP/Sakuma)