“There’s a lot of fear among Apple investors that the upcoming larger iPhone 6 models (reportedly coming in both 4.7-inch and 5.5-inch flavors) will serve to cannibalize the iPad product lines (in particular, the iPad mini),” Ashraf Eassa writes for The Motley Fool. “While this may very well be the case, the end result of this is likely to be a net positive for the Cupertino-based computing giant.”
“The argument against a larger iPhone is that users that would typically own a $549 or $649 iPhone would no longer see the need to supplement that device with a $399 iPad mini with Retina display for gaming and reading. While the screen real-estate difference between even a 5.5-inch iPhone and a 7.9-inch iPad is pretty substantial, let’s assume for a moment that the existence of a 5.5-inch iPhone ‘eats into’ sales of the iPad mini with Retina display,” Eassa writes. “What then?”
“So, what happens if an iPhone 6 5.5-inch replaces an iPad mini with Retina Display?” Eassa writes, “While this substitution may very well happen, it is likely that somebody buying one device to rule them all will buy a model with larger storage (since it needs to fit everything) which means that such a substitution could be very close to margin-dollar neutral.”
Read more in the full article here.