Apple’s ‘iPad mini’ can be its ace in the hole

“A recent story posted on Bloomberg says Apple plans to launch a smaller version of its market-leading iPad by the end of this year,” Richard Saintvilus writes for TheStreet. “It is expected to be priced comparable to Amazon’s popular Kindle Fire and Google’s recently announced Nexus 7 tablet, both $199. Though Apple has yet to confirm this report, it is speculated that a 7-inch iPad might be the talk of the market as early as October. It could be another blow to competition already unable to keep up.”

“If it is true Apple’s smaller iPad will be priced to undercut Google and Amazon, Microsoft might feel pressured to preemptively announce pricing or the date of availability for the Surface. The current iPad ranges from $499 to just a little over $800; Microsoft may be left with very little room to decide which market it wants to enter,” Saintvilus writes. “Amazon loses on each sale of the $199 Kindle Fire and Google only breaks even on the Nexus 7, but they serve essentially as storefronts for content distribution and the acquisition of ad market share. Microsoft does not have such a luxury. What does it stand to benefit by undercutting itself?”

Saintvilus writes, “Conversely, it can’t price Surface too high if gaining market share is a part of its strategy. Either way, Apple wins again. The big losers are going to continue to be Hewlett-Packard, Dell, Samsung and essentially every Microsoft and Google partner — particularly those of the latter.”

Read more in the full article here.

33 Comments

    1. Apple could make money from them because they would commit to build millions of them per month in the knowledge that they would sell for the asking price.

      A company launching an untried product into a market where so many had previously come to grief would not be in a position to proceed with high volume manufacture from the outset unless it was in a position where it could risk billions of dollars in a venture that might not succeed.

    2. Maybe. The speculation is that Apple would cut the screen from sheets used for the 3GS. That would save costs significantly, right?

      I still think it’s an odd decision. But that’s why I’m not in charge.

      It would help get people into the iPad market that wouldn’t otherwise. $199 is much less money than the $399 to enter right now.

      Apple won’t do it unless they can make a profit. Maybe $249?

      It’s not dickishness. It’s about getting more people to enjoy the Apple experience. Dickishness would be leaving the masses to wallow in the crap put out by the copiers and thieves.

  1. 7″ iPad? Not going to happen. All such rumors are hit generators, nothing more.

    Remember what Alan Keyes told Jobs about screen size. He was right.

    1. It’s inevitable.

      Jobs said lots of things that Apple later reversed course on. The main difference is Apple won’t do something unless they can do it right, and at a profit.
      Apple has scale on their side and has spent billions securing components.
      I’m perfectly happy with the New iPad, but there is most definitely a market for a smaller tablet. It may not be as much for creation as it is consumption but many of these things we already do on our smaller iPhone and iPod Touch screens.
      Portable gaming alone would make it worthwhile. Might even be better as an e-Reader. Great as an input device/remote for forthcoming TV.

    2. i could see a 7″ (or 7.85″ for technical reasons) as a good replacement for the iPad 2.

      The $399 iPad 2 might have been a quick & easy way to test the market got a lower price point.

  2. Everything seems to point to a 7.85″ display with the same resolution as the iPhone and original iPad. Take the small tablet market away from Amazon and Google before Android can even gain momentum.

    With this pricing structure, Apple would have an offering for everyone, and a easy upgrade path once you’re in their ecosystem:

    $199-$399 iPod Touch
    $299 iPad Mini
    $399 iPad 2
    $499 and up – the new iPad

    Apple just needs to reclassify their Apps to fall into 1 of 2 categories by size when you’re searching. But they can’t use Standard and Retina because retina depends on the device.

    1. This is exactly what I expect. and I bet this is how the presentation goes in Sept/Oct.:
      – state of the company
      – iPhone “5” announcement
      – new iPod touch announcement
      – Summary of iOS product line:
      “new iPhone/iPod touch (3.5″-4″, $199), new iPad / iPad2 (9.7″, $399 and up). We think we have the best post-PC products available. (one more thing shows on the slide) But what about here? (gap opens in slide between 4″ and 9.7″ offerings ($299 tier) with a question mark). What can we offer here? We’ve thought about this a lot, and we think we’ve come up with something really amazing. Introducing the iPad mini…..”

      1. I wouldn’t be surprised if the iPod Touch as we know it was rebrand as just the iPod and becomes the iPad Mini. The scenario above (with iPod Touch, iPad Mini, iPad) also makes sense but when you include the iPhone, I think having the iPhone, iPod and iPad (with sizes 4″, 7.85″ and 9.7″) is a little simpler.

  3. All those saying there will be no iPad mini forget one thing. Thermonuclear War. In that context it makes perfect sense. In your quest for the destruction of the enemy it is imperitive to deny him of ANY weapons.

    Apple can make money selling apps and iTunes media. What is important is denying Google any toe hold in the tablet arena. Thereby killing their ability to generate mobile search/ad revenue.

    Mobile is the next generation of computing for the masses. Controlling ALL segments of that market will eventually bring Google to it’s knees.

    War over!

    1. Apple doesn’t want Thermonuclear War. They only want to dominate the profitable part of the market. Avoiding a monopoly keeps things flexible. Also, Apple’s problem is making these things fast enough, not that the market doesn’t want to buy them.

      The analysts keep predicting Apple to do things that others are already doing, instead of trying to figure out what new market Apple could create. (Yes, the “skating to the puck” metaphor.) Think about the iPhone. The predictions were all warmed-over Blackberry derivatives. *IF* Apple made a 7″ iPad (which I don’t think they will), it would have to be something different.

      1. Then why did Jobs say he wanted to wage thermonuclear war on google? Job’s did not make idle threats… Ask Adobe and others. He was no saint… Don’t remember him ever turning the other cheek.

        1. If I remember correctly, Jobs was referring to war in the courts, to stop companies from copying Apple, rather than war in the market. That’s what I meant.

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