It is a different tale...
- they wanted to keep the price as low as they possibly can
Yep, 'cos a few dollars could be saved on the camera itself and a few more dollars on the extra development costs...
I don't think that the rounded-up price figures (minus 1 dollar) couldn't accommodate that extra tenner as an expenditure. I mean, starting at $499 going up to twice as much... come on!
I would blame organisational inefficiency: some mid-management figure f@@@ed it up at development and Bob Mansfield didn't act in time, because he was more busy with worrying about the lack of USB, battery performance, the massive touch screen and why the tablet needed an inch thick bezel.
Jony Ive was furious - he designed camera for the front and the back, but the back was always tricky, because of the tapered edges. Also, the 3G versions caused some unforeseen problems, because of the placement of the plastic bit that covers the aerial. "But... but this was supposed to be IT. This was supposed to be it! I mean... I mean..." - sighted Ive.
Schiller almost resigned - "you gotta be kidding! No camera on the freaking tablet?! We're gonna be hammered by the press!" "Don't worry, we will get away with this" - said Jobs. "People would kill for this thing."
"Yeah", thought Schiller, "they would kill you."
"Aaanywaaay! Whoever doesn't want to be in the ad and has his face known by the public, can keep moaning and f@@@ off! The rest... TO THE CORNER!!!" - shouted Steven Paul Jobs, current CEO. At once, everybody knew that this was the time when everybody had to shut their mouths. It was obvious that the next CEO would be one of the Senior Vice Presidents. Not appearing in the ad would have been accepting that there was no point campaigning for the position.
"Besides, who the hell would buy an iPhone next year, if they had the same functions on the tablet?" - asked Jobs the terrified board members. "Yeah, yeah, just call it on its name, it wasn't my idea! Phew! iPad... what a joke!" - thought Schiller, while a wet patch started to appear on the front of his khaki.
And another day just passed in Cupertino...