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Android Tablet Vendors Fear Apple's iPad Mini Pricing Strategy

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Apple reportedly will release its new smartphones and tablets in September; however, compared to these new products, Taiwan-based vendors are more concerned about whether Apple has plans to release an entry-level iPad mini or cut its existing iPad mini's price to boost demand, as both moves would significantly change the current tablet ecosystem, according to sources from tablet players.


When the iPad mini was launched, some research firms estimated its bill of materials to be at around US$188, compared to its entry retail price of US$329, the device still has plenty of room for price cuts. Although Apple has rarely adopted a price-cut strategy to boost its sales in the past, facing strong competition from various tablets, cutting prices is a possible choice for Apple to pick up its gradually declining market share.

 

If Apple decides to keep its new iPad mini priced at around US$351and drop its previous-generation model to around $260-280, it could significantly impact all the non-Apple tablet vendors and even change the tablet ecosystem.

 

Compared to Android, DigiTimes Research believes iOS has better management and less demand over hardware specifications. If Apple decides to release a lower priced iPad mini, the company will have advantages in cost control and product features, allowing the platform to have stronger competitiveness against Android.

 

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Comments

Hm

Think Red has nailed it... looks like a very believable strategy and one that would most certainly hurt the Android market further.

James Katt

I see these prices:

1. iPad mini 16GB for $275.
2. iPad mini with Retina Display 32 GB at $350.

These prices would CRUSH the competition.

Aksam

To Red:

No way Apple offers a $79 for cellular and 50$ to double the storage for the mini. It will still be $100+ for either.

And I don't see why they'd offer the 1st generation at a lower price than the mini whose purpose is to already be at a lower price than the retina full sized iPad.

For me, it doesn't fit the story but Apple is full of surprises.

Marko

What's being stated in this report contradicts your view. The fear Apple having two-tier pricing for the iPad mini. I tend to think that if Apple delivers a lower priced non-retina mini it will hurt Android. White boxers don't have many apps, so I don't think that's a huge issue.

Constable Odo

Most analysts never see Apple having an advantage over Android for any reason. To most analysts and Wall Street it's all about who has the most market share and the cheapest unit pricing. There's no tablet Apple can offer price-wise that will beat out the Chinese white box tablets that cost $60 to $100. These low-cost tablets are the ones that Wall Street believes will put Apple out of the tablet business and that everyone in BRIC nations will be buying. Wall Street believes that no one aspires to owning the higher-priced iPads when they can get Android garbage for practically nothing. All Wall Street ever says is that those cheap products are seen to be "just as good" as Apple products and that consumers are stupid and can't tell the difference between good products and mediocre products. I'm very sure that Apple can't compete in price against dozens of no-name Android vendors pumping out dubious quality tablets. Wall Street thinks in very simple terms. Whoever sells the most product is the winner and dominant player of the industry. And they believe that is Android.

Red

Hmm... I don't know. I don't see Apple dropping the current mini to anything lower than $279, if at all. I do see the iPad 2 finally being axed, since it still uses the 30-pin connector. It would be nice if Apple lowered the price for the cellular option across the board, and upped the standard amount of storage space.

I could see this:

iPad mini (2nd Gen) w/ Retina Display and 32GB starting at $329, add $79 for cellular option, add $50 for each storage upgrade tier to a maximum of 128GB.

iPad mini (1st Gen) 16GB (only) for $279 + $79 for cellular option.

iPad 2 discontinued.

iPad (5th Gen) $449 w/ 16GB, add $79 for cellular option. This would effectively replace the iPad 2.

iPad (5th Gen) $499 w/ 32GB, add $79 for cellular option, add $50 for each storage upgrade tier to a maximum of 128GB.

This is all just a big wish list, but I think it could be a good pricing strategy.

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