Ecosystem Agnostics May Tip Scales for iPad Mini Sales
There is a segment of customers who may be the difference between strong sales and incredible sales for Apple's newly launched iPad mini this holiday season, said IMS Research analyst Paul Erickson. Price will be a determining factor, but "even if it doesn't sell in amazing numbers, it'll still sell well, and it rounds out their product line."
Oct 24, 2012 4:42 PM PT
All eyes were on Apple on Tuesday as the company held its second product launch this fall to announce the iPad mini, along with refreshes to its iPad, iMac, MacBook Pro and Mac mini lines, ahead of the holiday shopping season.
The iPad mini features the same dual-core A5 processor as the iPad 2. The 7.9-inch device was designed to be light and thin for one-handed use. It has a larger display than its competitors in the same form factor, though, making it better for Web browsing, Apple said. It also has a FaceTime camera and a 10-hour battery life.
The smaller iPad will take on 7-inch Android tablets such as Google's Nexus 7 and the Kindle Fire. Starting under US$200, both models are more affordable than the iPad mini, which starts at $329 for a 16-GB, WiFi-only version of the tablet. Pricing maxes out with the 64-GB, 4G model at $629.
That price tag could be the iPad mini's biggest issue this holiday season, said Paul Erickson, senior analyst of consumer electronics at IMS Research. Apple's loyal customers who have been anticipating the smaller iPad will be willing to shell out $329 for the device, he noted.
There is a segment of the consumer market that's a target for the iPad mini. This segment includes people who aren't hard-core fans but could be swayed by the device's features and quality. Price is going to be the determining factor for this segment, Erickson said, and that could work against Apple.
"The battle there is for people who are interested in a tablet for multiple purposes. Maybe they have one device or another. They will be the determiner between whether Apple will sell very well or sell in amazing numbers. Even if it doesn't sell in amazing numbers, it'll still sell well, and it rounds out their product line," Erickson told MacNewsWorld.
"For people not already invested in Apple, that $130 or more price difference is pretty significant, especially around the holidays," he said. "If you're just looking for an e-reader, the Kindle Fire has all you need as far as content and size. Especially around Black Friday or holiday promotions, that price differential could even dip more. People are also increasingly using smaller tablets for Web browsing -- and in different ways -- and for that, the Nexus 7 is certainly a good more-general-purpose tablet, and could be a closer all-around competitor. It's going to be an interesting holiday season."
The updated iPad comes just six months after its predecessor, the iPad 3. It has an A6X chip, giving it faster, more efficient performance and enhanced graphics. The more powerful processor won't eat up more battery life -- it still will hold a charge for 10 hours. A new 720p camera on the iPad is FaceTime compatible.
The refreshed version is also twice as fast on WiFi connections, and its LTE coverage is expanded, according to Apple. It features the updated Lightning connector.
The fourth-generation version follows previous iPad pricing plans, starting at $499 for a 16-GB WiFi version. Pre-orders for both the fourth-generation WiFi versions of the iPad and the iPad mini start Friday, and they will start shipping Nov. 2.
It's quite a refurbished lineup from Apple this week, especially so soon after its iPhone 5 launch, said Trip Chowdhry, senior analyst for Global Equities Research. The products are high quality and will bode well enough for Apple, he noted, but without anything groundbreaking recently, it's hard to say how long the company can keep up its market domination.
"There was too much hype, and the announcements failed to live up to the hype," Chowdhry told MacNewsWorld. "Innovation at Apple is over. These have been just incremental improvements, nothing groundbreaking. The iPad mini is playing catch-up to Google Android, and will probably have a mediocre customer adoption."
Apple did not respond to our request for further details.
Tough on Education
In addition to listing the hardware specs of the new device, Apple highlighted the ways the iPad is penetrating different markets, particularly education. CEO Tim Cook unveiled the latest version of iBooks at the event Tuesday, showing off the e-textbook app. It is now available for 80 percent of U.S. high school core curricula, and more than 2,500 schools have classrooms that utilize iBooks. The updated app, which is supported in 40 languages, now has a continuous scrolling reading option, a cloud-enabled system that will sync the user's current reading to other Apple devices, and more sharing options.
iBook Author also received a refresh. The updated version features new templates, font options, and the ability to include mathematical formulas in books.
Apple's iPad emphasis on education for the iPad mini has the possibility to be an automatic edge over its competitors, said John Feland, CEO of Argus Insights.
"Amazon is right to be concerned," he told MacNewsWorld. "For the iPad 3, just over 8 percent of customer reviews mention using their iPads at school, whereas almost 6 percent of the Kindle Fire users mention scholastic use. With the iPad mini addressing the issue of price, Amazon has a real fight on their hands for the competitive and conservative educational technology market."