A friend told me that the neck wood only makes up 5% of the sound of a guitar, but the pickups make up 50%. Is he right?

>> Yes I would agree, in a way. But I don't like the idea of using percentages, even though I think we all get the basic idea. For example, if I said strings accounted for 30% of the sound, does that mean it would still sound 70% good without strings? ;-) Maybe if I listed the things that I think affect overall guitar sound, it might be clearer:

• Neck and fretboard wood - makes a small difference to brightness. Compare identical guitars with different neck in a music shop, and see if you can tell the difference.
  
  
• Guitar body wood and construction - I think makes a bigger difference than neck material. For example, a heavy maple and mahogony Les Paul with a glued in neck sounds quite different acoustically than a strat-style guitar with bolt on neck.
  Strings and setup - Replacing old strings that are corroded or have a build up of grime with new strings makes a huge difference to richness of tone, brightness, sustain, and the note play in tune up the neck. Using old strings is a false economy - this is the cheapest and most effective thing you can do to improve your tone.
  
  
• Heavy guage strings and a high action improves richness and fullness of tone, but you need to find a compromise that is playable.
  
  
• Pickups and wiring - can make a big difference between extreme pickup designs.
  
  
• Vintage pickup styles have less middle, good note clarity and are generally suiatble for rhythm and clean styles. Hot versions of these have more middle, and are better suited to solo work, and still retain the basic vibe of the guitar. Very hot pickups usually have a 'pokey' and middley sound that stays smooth with heavy overdrive, but does not convey the charatcter of the guitar so well. See other questions on this page about single coil vs humbucking desings. Wiring is a cheap way to get some entirely different sounds, but some experimentation is usually required to find the practical sounds, and some good design to make them easily switchable.
  
  
• Technique - makes probably more difference to your sound than anything else. How hard you pluck the strings, whether you use picks or not, where you play the strings, how cleanly you fret, and so on, all affect tone, timbre, clarity and sustain.
  
  
• Cables and effects - Obviously a faulty cable will destroy any sound, but I would recommend not using really cheap cables. The mid-price cables are fine for short to medium lengths, but high quality cables are essential for long cable runs. Good cables don't restrict highs, and prevent electrical interference. As for effects, these can alter your sound dramatically, or may be hardly noticeable, dependiong on where you set the dials!
  
  
• Amplifiers and speakers - You can read lots more on this topic on other pages here, but generally, a good amplifier will have a richer tone and better sustain. Closed back speakers usually have a tighter bass sound, and less spread of sound.