Here is the clear financial reason for Apple to launch an iPad mini

Here is the clear financial reason for Apple to launch an iPad mini
Here is an interesting observation about the possibility of Apple launching an iPad mini - there is clear financial logic to do so. On an earlier conference call, Apple’s head Tim Cook said that "one thing we'll make sure is that we don't leave a price umbrella for people".

An “umbrella” is a price segment of the market where the company doesn’t compete. Right now it’s obvious that Apple is not really playing in cheap tablets - ones priced from $199 to just around $400 where it offers the previous generation iPad.

Interestingly, in the past with its iPod and iPhone, Apple has used different strategies to fit all price levels. For the iPhone, it just kept on discounting older models and keeps on selling a 2-year old iPhone - currently, the iPhone 3GS. This is not how it handles iPad though. For the new tablet, the company is only selling two models - the current one and the previous generation, but not a third one, the original iPad.

This is what points our look to its strategy with iPod. With the iPod Apple started offering cheaper new models to fill in the price “umbrella.” Cupertino started offering the iPod Shuffle and iPod nano for different customers and price points.

Selling the iPad is not about subsidies, so this option is left out of the table. Finally, this gives one more spin on why Apple could sell a smaller and cheaper iPad soon. Will it do it? It’s Apple, so you never know, but that’s the fun part of it, isn’t it?

source: iAmConcise



1. wendygarett unregistered

Yeah right... From the site call iAMCONCISE... only fanboy will trust this source...

2. nyuvo

Posts: 72; Member since: May 10, 2012

you could also insert the ipod sales in that gap also.. Actually almost a perfect fit...

3. Reverence

Posts: 224; Member since: Jul 16, 2012

no way..........them iPod will become a flop device

4. Aeires unregistered

An iPad Mini is going to cost more than that, because they can. Everyone knows Apple followers will buy regardless how much Apple over prices it.

5. Gaurav008

Posts: 328; Member since: Jul 20, 2012

so under which price range will the new ipad mini(rumoured) fall???

6. palmguy

Posts: 979; Member since: Mar 22, 2011

Not gonna happen. Too much of a change for Apple. Maybe in one or two years.

7. downphoenix

Posts: 3165; Member since: Jun 19, 2010

I see ipad mini starting at $300. If they were any lower, it would potentially cannibalize ipod touch sales, as well as mean a lower profit margin for apple on this. Also, it wouldnt surprise me if it was only $100 less than the new ipad, at 400$, if the retina display rumor is true. Maybe Apple will just put it at $400 and stop making the ipad 2 and sell its remaining inventory at $300?

8. AppleConspiracy

Posts: 637; Member since: Oct 18, 2011

Despite being a very logical analysis, it's utterly arbitrary and doesn't reflect Apple's product philosophy. At least Apple's philosophy after iPhone, when they decided to have only one product in category. iPod with its diversity from Nano to Touch is still from pre-iPhone era and doesn't fit in their main focus - iPhone and iPad. There is a big reason Apple since iPhone makes only one product in category, not dozens (and covers price segments with older models instead different models). It would be very tempting to fill in the gap above, but with mini iPad they would make a competition to themselves - the original iPad would loose everything they invested in it. If, however, they choose to produce mini iPad, it would reflect completely new philosophy after Steve Jobs, and eventually they will start to decline.

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