Predicting the release of Apple’s medium-sized iPad has been the national pastime for the tech press this year. I would argue that it may be a very long wait.
Practically no one who follows Apple announcements expected the “iPad mini” to be announced alongside the iPhone 5. The conventional wisdom was that Apple would shine the spotlight on the iPhone for several weeks to guarantee a huge rollout, and then schedule another event in October to unleash the not-too-small, not-too-big iPad.
But then Apple announced the new iPod touch.
The latest generation touch now has the same larger screen (vertically speaking) as the iPhone 5, along with a host of other significant changes. And it’s priced at $299.
Which begs the question: what would they charge for the iPad mini?
Pundits predicted that Apple will price the still mythical device in the $200-$250 range, which is well below that of the new touch. I suppose the iPad mini could be built with cheaper components than the new iPod- a non-Retina screen, slower processor, lesser storage capacity, lousier cameras- all to drive it down to the price of something like the Kindle Fire.
This is a problem for two reasons:
1) Apple would suddenly be undercutting a new high-margin product with something slightly larger, cheaper, and slower.
2) Apple is not in the business of selling crap.
Let’s address the second point first. The battle cry for the small-ish iPad reminds me of a time in the distant past (3 years or so) when pundits declared that Apple would face certain peril if they didn’t create a super-cheap laptop to compete with the surging netbook market. Back then there was a range of $200 laptops available at your local Best Buy that ran Windows or Linux on cramped screens and were powered by yesterday’s technology. Profit margins on these devices were razor thin, and Apple just doesn’t duke it out for scraps at the bottom of the market.
So how much profit would Apple make on a $200 iPad mini? Not enough. Amazon is willing to go there with the Kindle Fire, but Amazon doesn’t mind barely operating in the black.
So, what if Apple decides to charge more than the iPod touch’s $299 price tag for the iPad mini? It would avoid the undercutting I mentioned earlier, and it would sit neatly between the price points of the touch and the the $499 iPad. That makes even less sense. Why? Because the iPad 2 parked in that slot at $399, and some believe it’s Apple’s best selling tablet.
Any way you slice it, there’s little if any room for a device like the iPad mini to slide into the current lineup.