The following is an excerpt from Jared Newman | July 6, 2012 | Time.com |
The rumors of a mini iPad have surfaced once again, and I’m starting to believe them. Both Bloomberg and the Wall Street Journal report that Apple will launch an iPad with a screen smaller than 8 inches this year, citing unnamed sources.
In the world of Apple rumors, Bloomberg and the Wall Street Journal represent a sort of turning point. Their stories about unreleased Apple products are usually vague on details, but the gist–that product X will be released during timeframe Y–tends to be correct, especially when both publications report the same story.
As a fan of competition and someone who generally enjoys Android–especially the latest version, Jelly Bean–I desperately want to be contrarian about this. I’ve been trying to think of ways in which a smaller iPad wouldn’t destroy Amazon’s Kindle Fire, Barnes & Noble’s Nook Tablet and Google’s upcoming Nexus 7, but so far, I’ve got nothing.
Price alone won’t be fatal. Despite what some pundits are claiming, I doubt Apple can hit $200 with a 7.8-inch iPad. The only way the competition gets that cheap is by sacrificing hardware profits in hopes of making money on digital content sales.
Apple doesn’t work that way. According to unofficial estimates, Apple makes about $150 in profit on the Wi-Fi iPad 2, which now sells for $400, and for the latest iPad, the profit margins are even greater. Content sales are just gravy. Unless I’m drastically underestimating Apple’s supply chain prowess, a smaller iPad priced at $250 or $300 seems far more likely if Apple still wants to make a profit on hardware.
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