Ever since Google Glass was offered for sale to a select group of people it has carried the same price tag. The Explorer edition units cost $1,500 and Google quickly sold out of them when it opened up purchases to all U.S. residents for one day only. A lot of people would have wondered why these units cost so much and might have believed that it has something to do with expensive parts. TechInsights doesn’t think so. According to an estimate by its business Google Glass parts cost just $79.78.

A Google spokesman reached out to the Wall Street Journal and said that this estimate is “absolutely wrong,” without elaborating the costs associated with a unit. Google is yet to reveal how much it will ask for Glass units once they’re publicly released. It certainly can’t sell it for $1,500 and it really wouldn’t want to sell it at a loss.

The glass display, which is an essential part of the unit, apparently costs just $3.00 as far as TechInsights is concerned. Single most expensive component is apparently the OMAP 4430 applications processor by Texas Instruments which is estimated at $13.96. Glass also uses 16GB of NAND flash memory provided by Toshiba for $8.18.

It should be kept in mind though that components aren’t Google’s only expenditure on the Glass project. The company has an entire team dedicated to the product, with engineers, designers and other resources likely drawing handsome salaries. So even if the estimate is absolutely wrong as Google puts it, that doesn’t mean Google has been lining its pockets with Explorers’ money.

Pricing will undoubtedly be a big factor behind the success or failure of Glass in the market. Wearable devices are mostly priced below $299 and there’s a certain limit up to which customers would be willing to spend on such a device. Obviously the public won’t line up for it at $1,500 a pop.

Actual cost of components might only be a bit higher than what’s estimated here because Google will only be able to sell it at a competitive price if its not proving too expensive to manufacture.

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