Is Apple giving up on tablets, or is the new iPad a smart business move at $330? (poll results)

As you an see from the chart above, the tablet market is far from its heydays, and its growth is expected to stall for the sake of laptops, which are projected to grow in shipments. Apple just shifted its tablet strategy this week with the introduction of a new 9.7" iPad, whose price starts at just $329, compared to $499 before. Most of our survey respondents below think that this is a smart business move, given that the hardware components inside have fallen in price since the days of the Air 2, and Apple's app and services business is growing leaps and bounds, too. Just 13% consider a $330 iPad giving up on tablets, while a third of our respondents consider this this move as a little bit of both.

Apple has undoubtedly taken notice of these developments, that is why it unveiled a new 9.7" iPad the other day, two and a half years after its last Air 2 slate, with a simple press release, eschewing the usual on-stage fanfare. The new iPad 9.7", however, starts at just $329, whereas all of Apple's 10-inchers before it were $499 at their basic config. Given that Apple commands a quarter of the tablet market, and practically all of the high-end segment, the new iPad will inevitably start crowding out the competition. We gave the LG Gram example above to showcase how the new thin and light laptops can be more compelling than a tablet+keyboard combo, but there's one important caveat - you  can't get the Gram for $330. The most you can get at that price would be a Chromebook, and that might be what Apple is targeting here, as Google's pseudo-laptops are wiggling their way in the education realm, encroaching on Apple's educational focus for iPads.

Will Apple still make money from the iPad at $329, though? Don't worry, when the iPad Air 2 launched two and a half years ago, IHS estimates pegged the cost of its components and assembly at $275. The nature of the electronics' industry is that cost of components falls drastically over time, and the only upgrades worth talking about in the new iPad, compared to the Air 2, are a faster, A9 chipset, a "brighter Retina Display," and a new Touch ID finger scanner. Furthermore, given that the new iPad won't have the laminated display tech and anti-reflective coating of its predecessor, we wouldn't be surprised if the total cost to make this thing now hovers around the $150 mark. Thus, the new slate still offers a decent margin in terms of pure hardware, but let's not forget that Apple also makes bank on apps and subscription services. 

This "service" business at Apple is growing much faster in revenue than the rest of its portfolio. The App Store, Apple Music, iCloud, iTunes, Apple Pay transaction fees, and so on, hauled in no less than $6.325 billion in Q3, which is a 20% increase year-on-year, and the profit margin from those is pretty high. Thus, the more iOS devices Apple gets in the hands of users, the more money it will make on the accompanying apps and media consumption from its software ecosystem over time.

Is Apple giving up on tablets, or is the new iPad a smart business move at $330?

Giving up on tablets
Smart business decision
A bit of both

Related phones

iPad 9.7-inch
  • Display 9.7" 1536 x 2048 pixels
  • Camera 8 MP / 1.2 MP front
  • Processor Apple A9, Dual-core, 1850 MHz
  • Battery 8827 mAh



1. gustavoace

Posts: 187; Member since: Nov 13, 2012

People like to see number and more "horsepower" on the chips but truth is that the current chips can hold any tasks you have. Unless you want the tablet for gaming, can think why A9 chips cant lasts for like 5 years or way more. And despite lowing the prices, their profit should be the same, and selling more units will increase their value and their market share. I can only regret the lack of smart connector for the keyboard. Everything else suits me very well.

2. juandante

Posts: 679; Member since: Apr 23, 2013

Not at all. Limited minds like you will say that more powerful chips are for gaming. The truth is that you are ignorant. I need to do some photo-montage on my phone and clearly we are light years ahead of what I could have done some months ago thanks to this powerful chips. Let me talk about maps and path-finding. It's clear that the GPS software have become more detailed and useful than ever. This are two domains where I am very happy more powerful chips are coming out every year. And I am sure other users (like those processing data or other) could tell you same regarding their domain (but don't miss interpret as me saying that I am for obsolesce because its true that Samsu.. Err some manufacturers does everything to push you to upgrade even when you don't need to). New powerful chips provoke new level of software quality and those latest provoke new powerful chips.

4. TechieXP1969

Posts: 14967; Member since: Sep 25, 2013

No they don't. The vast majority of consumers could care less about specs. They want features and the iPad for what it costs should have them. The iPad for example, Apple adds 2 more speakers. But they aren't the auto-sensing variety. The benefit is, the tech would sense which way the tablet is facing and move the sound to the proper speaker. This tech existed for years. Why did Apple not use it? Yet the fans claim when Apple does something they do it right. Samsung puts 4 speakers for the first time and they use the right kind. Split-screen. For Apple this should have been a no-brainer. OSX is a multi-windowing OS. It made sense to remove it for a small phone, but for a tablet the very first iPad should have had it. But Apple was to busy skimping on the specs to accomplish it. Then they waited forever to even add a dualcore chip. First off you don't even need dualcore to have to apps on the screen. You need more RAM. Something Apple to this day still skimps on. Then also with the pro, they advertise how great it is with a pencil. Yet don't even include it. While Samsung has included a pen with the Note for years and now the Tab S has one too. What is Apple doing? NOTHING! Lowering the cost wont drive sales if I already have a tablet that does the same thing. New isn't better. New doesn't make it better. New is, better when what it offers is above what I already have. The iPad doesn't need faster hardware anymore. It needs features. That is why sales are going down. Because if you have an iPad Air, what does the Pro bring? NOTHING NEW! Samsung's tablets haven't really gained any features either which is why I stopped buying them. They totally abandoned the Note 12.2 other than it did get Android 6.0. But it didn't land any improvements. They didnt even change the UI. All the improvements are under the hood. So why should I buy a new Samsung tablet? I already have one with a pen. Sure its doesn't have 4000 levels of pressure, but the WACOM pen I bought does. Apple has all this money, that everyone so brags about. What do they do with it? NOTHING. Dropping the price is pointless. The products are still identical other than speed bumps. The speed bumps will go 100% unnoticed other than using benchmark apps. There are so many great features a tablet can have. Look at the Surface. This is why Apple needs an X86 OSX running tablet. While they mocked Microsoft, the Surface has almost the market-share the iPad has and ales are goign up on tablet/hybrids while iPad sales are dropping double figures. Not to pick on Apple and Samsung, but the fact is; all ARM based tablets are a complete waste of money for any price beyond $250. Because the $700 iPad doesn't do anything that a $250 Android tablet scan't do already. Its only faster. But speed means nothing when its speedy at doing nothing.

6. -swagfox-

Posts: 45; Member since: Dec 01, 2016

Ayyyyyy techieXP is in the house, let's see what he got wrong: Tab S3's speakers are crap. From The Verge: The bigger disappointment for me was the tablet’s four speakers. The speakers are located on the top and bottom of the tablet, so when you position it in landscape to watch a YouTube video or a movie on Netflix, all the audio gets blasted way out to the left and right of you. In some cases, this creates a really exaggerated stereo effect, where it can sound like people are only talking out of one side of the tablet, and in the worst cases, well off to the side of where they ought to be. The speakers get plenty loud, and the issue isn’t always that noticeable — during a fight sequence in Captain America: Civil War, the effect almost came off as immersive — but films’ quieter sequences and, really, most YouTube clips I’ve watched have been kind of annoying to listen to. The fact that the speakers are directed to the side of you is clearly part of the reason this is happening, but I also suspect that Samsung is being too aggressive in the way it splits up audio channels, resulting in sounds that should be coming from a center channel ending up shifted way off to the side. 'k, let's see what else: Stop whining about split screen apps, when THEY WEREN'T ON ANDROID UNTILL LAST YEAR. seriously dude, you're just going to ignore that? That whole RAM thing- iOS is so optimized, it doesn't3 need a ton of RAM. The apple watch with watchOS 33 can hold TEN apps with HALF A GIG OF RAM. I do agree with your argument on apple pencil- it should ship in the box with iPad pros. that said, your argument on samsung shipping styluses is utter bullcrap- and I know because I have a note 4. android has ZERO good drawling apps. on iOS, you have procreate and paper by fifty-three. what does android have? NOTHING. and your argument for an X86 iPad is outdated- Microsoft is working on windows on ARM. face it buddy, ARM IS THE FUTURE. lastly, I REALLY think nobody knows what this tablet is for. it's for education. the price drop is just so they can compete with chromebooks. that's really what this is for- usage in schools. not whiny power users or trolls.

7. TechieXP1969

Posts: 14967; Member since: Sep 25, 2013

Firts off, I never take a tech's site opion on any product until I try myself. I have a Tab S the original and the speakers sound great. They actually have a "surround" sound feel to them and is very ear-pleasing. I dont like the Tab S2 or S3 because I don'[t like 4:3 aspect rations. I prefer 16:9. So the fact it isn't 16:9 already makes it a non-buying options for me. I don't even care about what is good or bad about it otherwise. But thanks for the heads up. However I still plan to check it out. For me ANY small speakers has terrible sound reproduction overall. But at least with headphones, the sound loses less quality because the sounds fires directly into your ears. If it fires into the air, with such a small speakers, its going to suck overall. I wasn't trying to be wrong or right about anything. I gave my opinion. Nothign more!

10. TechieXP1969

Posts: 14967; Member since: Sep 25, 2013

I do agree that side firing speakers that don't turn the audio towards you typically sucks. I agree 100% with that. On the original Tab S, when though the speakers are on the side, they are aimed towards the listener, which is likely why they sound better. But what should be great about the Tab S3 speakers is, the stereo effects will at least fire the proper left and right sounds to the right speaker no matter which way the tablet is facing. That is a huge plus. But all I can say is, when it comes to opinions, I will listen and then try for myself. Many people said the S7 speaker sounds bad. To be vs the S6 it doesn't sound bad, its just muffled because of the waterproofing. All I can say is, I have to TRY and listen to the Tab S3 before I take an opinion of it. Because opinions aren't right or wrong. For many the Tab S3 speakers could be adequate overall. One thing I hate about laptops is, for the size of the laptop, the speakers are too small. When HP used Beats Audio, it sounded better in headphones, but the speakers didnt bring any real sound and it has a subwoofer. But the sub was so flat, it didnt offer any bass, even with it firing down to the surface. Now HP uses Bang & Olufens. The quality is clear and sounds natural. But the bass sucks unless you use headphone. Why? The speakers are to tiny. With tablets the casing is simply to thin for real speakers. Anyone who expects any phone to tablet to sound great with speakers, will be sorely disappointed. IOS devices have a louder speaker, but louder doesn't make it sound better when it sounds like it has static. There is no way to fix the problem, because of the speaker size. They are cheap drivers.

13. TechieXP1969

Posts: 14967; Member since: Sep 25, 2013

The problem with the iPad is it is a toy. It is a 10" iPod Touch. For the money Apple has made on it, it should be a much better product. By now it should be a Surface.

14. buccob

Posts: 2978; Member since: Jun 19, 2012

Android Split screen is recent... but Samsung, LG and others have been implementing it for years, or at least some kind of better multitasking than just "one app at a time"... For instance, my Asus Memopad FHD from 2013 has a very nice windowed multitasking, even if it doesn't do split-screen... So after it's screen broke (along with the digitizer) I paired it with a bluetooth keyboard and mouse, and its been almost like a dedicated Laptop... in fact, it also supports standard USB OTG and has a dedicated microHDMI port, so it is already more versatile than this "cheap" iPad. TechieXP might have some wrong points... but he is right about that. Apple could still offer an affordable device without skimping too much on specs or features.

3. tedkord

Posts: 17452; Member since: Jun 17, 2009

I think it's more a case of the public giving up on them.

5. TechieXP1969

Posts: 14967; Member since: Sep 25, 2013

Yes, because when you have to do this - - whats the point of buying? They are boring. The iPad has never been a "ohhhhhh I gotta have it". The iPhone 4 for me was a "ohhhhhh I gotta have it" and so what the 5S even though I never did purchase one. I was gifted my first iPad and I sold it days later. With only 512MB of RAM it was simply to slow. The iPad Air is the best model with its Tri-Core. Why did Apple remove a core on the pro vs add one? PROFITS. Apple's every single move is about greed. They could care less if you get your monies worth or not and that for me is an issue. Yet they brag about how much they make. I don't care what they make. I want to see what they make go into their products. They increased the cost of the MacBook by almost $300 for that bar. The bar is very useful. Its not $300 useful though. The sales are dropping by double figures because the iPad has not offered any real benefits or has changed over the years. Its just the prettiest tablet. Itis the most useless one of all...well next to the Amazon Kindle.

9. -swagfox-

Posts: 45; Member since: Dec 01, 2016

It's not all specs, moron. The iPad Pro is more powerful than the iPad Airs, and it has a dual-core. That's because IT'S OPTIMISED. Apple intentionally makes lower specs, but tweaks iOS to suck out every drop of performance, and it gives them better battery life. (except on iPhones. WTF apple...) you still get a faster product than, say, super laggy samsung (sent from my note 4). Even HUAWEI is trying to keep their phones always fresh and fast. Samsung and Oneplus can chase numbers, but Apple will always be fastest. WAIT I GET IT- TechieXP. YOU'RE STUCK THINKING TECH STILL WORKS IN THE SAME WAY SINCE THE WINDOWS XP ERA.

12. TechieXP1969

Posts: 14967; Member since: Sep 25, 2013

Who said anything about specs? But if your specs a product better, that means you can add better features? YES or NO? SPECS MATTER! to a point. But I didnt mention specs. I mention how they keep bumping up the spec per say, but dont add anything to show it off. The iPad feature-set has remain 100% identical to the original iPad. The only difference is it has split-screen. Force Touch sucks so bad, they didnt even waste time bring it to the iPad. But the iPad Pro should have had it, considering they increased the price $100 over the Air. And what did it do that the Air doesn't? Nothing. Just 2 extra speakers. If Verizon didn't sell me the iPad Pro for the same cost of the Air I wouldn't have bought it. I dont care what something costs. I don't what I can afford already. I never look at cost first. I look at specs and I look at features and then the cost. If the features don't justify the cost enough for me, I simply wont buy it. I don't give a crap about brand loyalty, If a brand wants me to be loyal, then make a product I want to buy. I dont buy simply because it exist. I did that in the past and I regret it. I dont want a tablet that simply mimics my smartphone. I dont need cameras on a tablet. Its stupid. That space is better served with a large battery, a nice display and speakers and nice features.

15. jeroome86

Posts: 2314; Member since: Apr 12, 2012

Be careful. Facts are not allowed here. Lol.

8. bucknassty

Posts: 1365; Member since: Mar 24, 2017

TechieXP brings the FIRE... although i do not want to read all the vomit ya'll throw back n forth each day... some parts of his rant i like to highlight and he does bring some legititmate pieces to the debate

11. TechieXP1969

Posts: 14967; Member since: Sep 25, 2013

Well I try. Because I try not to be bias for or against. All products have pros and cons. Some of that matters more to me vs others.

19. mikehunta727 unregistered

Techie's alt confirmed, and yeah Techie you are incredibly biased and also quite misinformed in a lot of areas related to tech/smartphones, to each of their own though!

20. bucknassty

Posts: 1365; Member since: Mar 24, 2017

sorry bro.... not Techies alt but i see you like to follow him

16. mikehunta727 unregistered

Main reason why Tablet sales are down because of the upward trend of phablets in past years, it's that simple. I really never touch my tablet anymore since I started using phablets a few years ago, when people had devices with small screens like 4", etc, tablet usage was a lot higher...and also obviously the lure of a tablet is not the same as it used to be so theres that. But phablets are main reason why

17. jeroome86

Posts: 2314; Member since: Apr 12, 2012

Someone on the dual core, tri core subject again in the ipads. Do you want to try to teach him one more time or is it a lost cause?

18. mikehunta727 unregistered

Honestly don't give a s**t to correct him lol not my problem...can't teach a wall. Anyone with even some knowledge of tech/CPU's already knows this He obviously doesn't understand that having 2-3 billion transistors dedicated to 2 CPU cores will outperform a tri-core design that only has 1-2 billion transistors dedicated to CPU cores/cache system Dude is literally bitching at the fact that Apple gave it's users a pretty big leap in SoC performance from the A8X to the A9X, it costs Apple more to give users A9X vs A8X, A9X outperforms the A8X in every single way, CPU/GPU performance, RAM/bandwidth performance, and also flash storage performance

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