“There are many different kinds of consumers with very different needs, wants, drivers, and checkbooks. Sure, our friends and family kind of seem like us, but that’s because its human nature to surround ourselves with people similar to ourselves. We may think that we are a lot different from our friends, but statistically, we are very similar,” Patrick Moorhead writes for Tech.pinions. “Let me give you just one example: According to the U.S. Census bureau, the median household income in 2010 was pegged at $49,445. Do you make a lot more… a lot less? You get the idea.”
Moorhead writes, “As it relates to the iPad, there are consumers who would have stretched up to buy a $499 iPad 2 who will, instead, buy the $199 Fire.”
“Based on information from my contacts, both Apple and Amazon have been conservative in their production forecasts. Apple doesn’t want to get stuck with potential inventory before their next iPad and Amazon took a cautious tone given it’s a new product and they barely break even on the gross margin side with an untested video and music upside content model,” Moorhead writes. Net-net, for the holidays, both will sell out and we won’t be able to see who will be the finest cannibal. BUT after the holidays, when inventories are adjusted and there isn’t a line for either, if Apple either doesn’t adjust their pricing, introduce a lite-iPad, a 7″ iPad, or a new kind of subsidized business model, they will lose out in volume to the new class of 7” tablets, not only from Amazon, but also from Barnes and Noble.”
Read more in the full article here.
MacDailyNews Take: Moorhead is correct (although it’s fair to mention that iPad cannibalizes Amazon’s Kindle Fire, too. People who want 3G connectivity, a screen more than double the size, more and better apps, greater security, etc. will choose iPad over cheapo Android tablets with tiny screens). Regardless, Apple will adjust to the changing dynamics of the marketplace, as they always do. Watch and see, this is one area where Tim Cook shines especially brightly.
Related articles:
Wired reviews Amazon’s tiny-screen Kindle Fire: Web browsing sucks, emotionally draining, makes reading a chore – November 14, 2011
NY Times’ Pogue reviews Amazon’s tiny-screen Kindle Fire: Sluggish, ornery, unpolished – November 14, 2011
The Verge reviews Amazon’s tiny-screen Kindle Fire: Uninspired, confusing, incredibly unoriginal – November 14, 2011
Engadget reviews Amazon’s tiny-screen Kindle Fire: Sluggish, clunky, too limiting and restricted – November 14, 2011
PC Magazine reviews Apple iOS 5: The best phone and tablet OS, Editors’ Choice – October 15, 2011
The Guardian reviews Apple iPad 2: Ahead of the pack – March 25, 2011
The Telegraph reviews Apple iPad 2: Does everything better; now’s the perfect time to join the iPad club – March 25, 2011
Computerworld reviews Apple’s iPad 2: ‘The Holy Grail of computing’ – March 16, 2011
Ars Technica reviews Apple iPad 2: Big performance gains in a slimmer package
Associated Press reviews Apple iPad 2: Apple pulls further ahead – March 10, 2011
PC Mag reviews Apple iPad 2: The tablet to get; Editors’ Choice – March 10, 2011
Associated Press reviews Apple iPad 2: Apple pulls further ahead – March 10, 2011
PC Mag reviews Apple iPad 2: The tablet to get; Editors’ Choice – March 10, 2011
Pogue reviews Apple iPad 2: Thinner, lighter, and faster transforms the experience – March 10, 2011
Baig reviews Apple iPad 2: Second to none – March 10, 2011
