Lumia cost $209 to make
 

Nokia's great white hope, the Lumia 900, cost it $209 to make, according to research firm IHS iSuppli.

That figure is 46 percent of its retail price, with the Finnish firm saving a fortune on processor and memory costs.

In a statement analyst firm IHS said that the Lumia 900 represents a make-or-break effort by Nokia and Microsoft to re-establish their foothold in the smartphone business.

The teardown shows that Nokia is willing to accept hardware lower margins to carve out smartphone market share.

In addition to a Qualcomm chipset, the Lumia 900 uses Samsung's $58 display, memory from Micron and Elpida, and smaller components from Broadcom and STMicroelectronics, the researcher said.

The Lumia is similar to Samsung's SII Skyrocket which cost $236. Samsung used a more expensive processor and more memory to reach similar performance.

But all is not well with the Lumia. Nokia has said it had found a software bug in the model and it will be giving a $100 refund until it is fixed. While this is not the kiss of death to the handset, it does blunt any hopes that it will be a best seller.

IHS might be wrong as far as the importance of the Lumia is to the Nokia/Vole pact. In many ways the phone is a dry run for the introduction of Windows 8 based phones later this year.

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