In just four days, Apple will probably, likely, maybe unveil a pint-sized version of its immensely popular iPad. And despite a steady flow of rumors, there’s still quite a bit of intrigue surrounding the device — more so than with Apple’s iPhone 5, which we practically knew everything about even before CEO Tim Cook took the stage. Why is this?
Plain and simple.
Consumers won’t be the only ones keeping a close eye on next week’s event. Apple’s competition — Google, Amazon, Barnes & Noble, and even Microsoft to an extent — will be anxiously awaiting just how low the Cupertino company is willing to go when its mini tablet hits. $200? $250? $300? $350?! Anything other than cheap could be a huge misstep in Apple’s quest of continued market domination.
The iPad-maker has a reputation for wielding premium prices, but for once it won’t be able to dictate the market because competition has beat Apple to the small tab scene. It’ll have to follow suit. That’s absolutely fantastic for consumers, because it puts Apple in uncharted territory — commanding high prices is a staple of the company’s business model. Why get an iPad mini that starts out at $350 (this is just a guess), when you can get a Nexus 7 for $200 (or maybe cheaper if we believe recent rumors suggesting it will fall to just $99).
For that matter, the price of Amazon’s Kindle Fire has been dropped below $200 — the HD is $199 — making it instantly appealing to consumers who want a tablet strictly for consuming media, which is exactly what the iPad mini will be designed to do.
As 2012 has gone on, especially after announcing iOS 6, Apple’s pristine reputation for innovation and forward-thinking has come under fire. It might not be something that’s acknowledged by most consumers, but for those who closely follow the market — and compared to what others like Microsoft and Google offer — it’s apparent the Cupertino company is stumbling. Not falling, but it’s certainly off balance.
Apple’s design chops are still as good as they’ve ever been, with the iPhone 5, despite its inherent flaws, being the best-looking iPhone yet. And even though its software efforts have stagnated, there’s still just enough newness there to keep current customers on board, and new ones flooding in. But competitors have largely caught up, and in some instances, surpassed Apple’s ability to create that perfect combination of hardware/software, technology and Liberal Arts.
As a result, the competing business models of companies like Amazon and Google are forcing Apple to approach the market in a way it didn’t anticipate, or even wanted to in the first place — the iPad mini is proof of that, and so is the larger iPhone 5. Better yet, it could force Apple to price the iPad mini low. Sure, it’ll take a significant chunk of iPod touch business away, but better than the business going to a competitor.
Daring Fireball’s John Gruber said it best: “If a customer walks into a store and sees a (say) $249 smaller iPad and decides to buy that instead of a $299 iPod Touch simply because it’s cheaper and bigger at the same time, that’s still a win for Apple. The customer just bought an iPad… If a customer walks into the Apple Store and wants to buy something that will fit in their pants pocket or strap onto their arms while exercising, the iPad isn’t even in the picture.”
It’s not like the current iPad is doing poorly, but Amazon and Google have certainly taken a significant enough bite out of the Cupertino company’s market share — low priced, quality products will do that. The advantage of being able to wield bottom dollar prices (sometimes just barely breaking even) is enormous. But Apple could take that all away with a similarly priced iPad mini. It has to.
If it does? It’ll be hard for Amazon and Google to keep up, simply because the iPad mini will be available everywhere on display at big box retailers and Apple Stores across the country. That’s one humungous, gigantic advantage that Amazon and Google just cannot compete with, no matter how cheap and how good their products are. Apple’s retail presence is the strongest of any other electronics company on the market, and a huge reason it has enjoyed such a successful year.
Reviews certainly help to sway consumer buying decisions, but physically going into a store and touching a device is the ultimate way to market a device. That’s why you see Apple kiosks in Target stores. That’s why Apple devices are set up the way they are around the world. When the average consumer goes into a Best Buy to look at tablets, it really does no good when the competition isn’t even there.
So cost will be the biggest news come Oct. 23. Not the device’s specs; that’s insignificant to the average consumer. The competition have attacked Apple’s iPad the only way they know how: by creating the smaller tablet market and beating Apple’s premium prices. But the iPad mini could be a huge response that drowns out other companies’s bottom dollar bragging rights, and further assert Apple as the dominant tablet king.