Up til now, I really haven't bothered to do much work on the actual economics of Truefocus, mostly because upside from current EPS and P/E seem clear enough without all that work. Still, I thought it wouldn't hurt to take a crack at it and get feedback from others on the board who might have better information.
Let's start with a typical camera chip.
ASP $3.25
Cost $2.60
Contrib $0.65
Of course, this is just a blended avg, with high end chips costing more and having a higher contribution. Anyway ... this is the "wholesale" component price, and that gets marked up plenty by the time it reaches the consumer. I have to assume something like 3x. In other words, I'm thinking that the average cell phone would cost something like $9.75 more with a camera than without one, all other things being equal.
Now, let's look at Truefocus economics. There is some hardware involved like a fast DSP and also a board because the camera unit will no longer fit on a single chip. I'm guessing that the extra cost for this would be something like $3. Probably around $2 for the DSP (assuming quantities of 10K+) and a buck for the interconnect and packaging. If we assume Omnivision charges an extra $1 for the WFC IP, the the economics of an omnifocus camera module would look something like this:
ASP $7.25
Cost $5.60
Contrib $1.65
This implies a gross margin of 23% which is better than they are now, and also almost three times the contribution per unit. It also implies that the average consumer would need to be willing to pay something like $12 ($4x3) more for Truefocus functionality.
The best part about all this is that the $3 in hardware costs (if it even is that high) is going to go down, while ASP's for truefocus should stay the same or even increase because there is nothing else like it.
With MU / Aptina going bankrupt soon Omnivision will be the only supplier left able to deliver the quanities needed for all the OEM's and the only one with instant EDoF.
TTLYON
