Phil Schiller Defends iPad Mini Pricing Decision

[Roman2K~]

Nexus 7 - higher ppi, NFC, more RAM, quadcore, GPS, $100 less expensive...

All true. I bought one for my mother, it's one sleek and sturdy piece of hardware. Android has matured so much that I prefer it to iOS now, on both phones and tablets. There's also a good number of excellent apps* nowadays. And being a Nexus, it gets updates directly from Google on a regular basis. At $200 / €200, really good deal, especially seeing as the iPad mini costs this much more!

* Like VLC, Spotify, Pocket Casts, Pocket, Tasks, ... and of course Google's own Chrome, Google+, Calendar, YouTube, Reader and Maps. Good stuff, really.

 

[RobertMartens]

Apple is charging a premium price for a product stuffed with old technology.

Seriously, a dumb move by Apple. I agree that they shouldn't sell at cost (like Amazon and Google), but Apple had a unique opportunity to effectively close the door on its competitors and it chose not to.

Apple is not trying to close the door on competitors.

We'll see soon enough how "dumb"

 

[Fresh Burek]

Nexus 7 - higher ppi, NFC, more RAM, quadcore, GPS, $100 less expensive...

I had a Nexus 7 that I just sold because I didn't really use it and don't need a tablet. But I agree, way better than iPad mini. Sharper screen, faster, more features, etc. and much cheaper.

The only advantage iPad has is better materials and build quality. Asus' QA sucks.

 

[Westside guy]

Nobody's holding a gun to your head. Is the build quality, rear camera, and iOS ecosystem worth the extra money to you? If you don't think the price is justified, don't buy it.

It's not even Economics 101... more like Economics 001. If lots of people buy it, then the price is reasonable and competitive. If they don't, it's not.

 

[IJ Reilly]

The bigger disappointment for me is the premium you pay for cellular. All that extra $$$ and nothing more than an antennae; not extra HD space, no SD slot, no anything.

Cellular is a different chipset. Is it $139 worth of a different chipset? This hardly matters, if the added functionality sells for $139. Apple knows it does.

 

[mjtomlin]

If it is a mini iPad 3, then I wouldn't have a problem with the price. I never had a problem with Apple pricing until now with the iPad mini.

The mini has all the same specs as the iPad 4, other than display and SoC.

It is basically a shrunk down iPad 3. Go to to Apple's site and look at the comparison...

http://www.apple.com/ipad/compare/

 

[Jibbajabba]

"Yeah, why cheaper? You dorks buy anything with the fruit on it, even overpriced"

Now that made me laugh - thanks for covering my keyboard with tea lol - that is so frikin true, it's unreal (haha). The same people complaining about things like the iPhone 5, are the first Queueing overnight at an Apple store - gotta love the interwebs.

 

[milo]

Apple doesn't race to the bottom on price.

In this case they're keeping the price way up there...they're just racing to the bottom on screen resolution and PPI.

And Apple should sell it at cost why?

Straw man argument. Nobody has said they should sell it at cost - even at a lower price they could still make a generous profit. Although as others have pointed out, if sales are going to be limited by manufacturing anyway, they might as well price it on the high side in the short term until supply catches up with demand.

 

[ixodes]

Price is meaningless really.

Those who have been around, and are long time Apple enthusiasts are used to the fat margins Apple commands.

Those who haven't, cough up the money anyway... gotta have that fruity logo.

And the rest of the masses are busy keeping up with the Jones.. even if that means maxing out their credit cards, or selling whatever they can to get what's cool and trendy.

Ah yes the power of clever marketing, ya gotta hand it to Apple.

 

[RobertMartens]

All true. I bought one for my mother, it's one sleek and sturdy piece of hardware. Android has matured so much that I prefer it to iOS now, on both phones and tablets. There's also a good number of excellent apps* nowadays. And being a Nexus, it gets updates directly from Google on a regular basis. At $200 / €200, really good deal, especially seeing as the iPad mini costs this much more!

* Like VLC, Spotify, Pocket Casts, Pocket, Tasks, ... and of course Google's own Google+, Calendar, YouTube, Reader and Maps. Good stuff, really.

Yeah Nexus is great, I guess we won't be seeing you around on this site anymore. See you.

 

[everything-i]

Apple is charging a premium price for a product stuffed with old technology.

Seriously, a dumb move by Apple. I agree that they shouldn't sell at cost (like Amazon and Google), but Apple had a unique opportunity to effectively close the door on its competitors and it chose not to.

You say old technology but compared to what? The full size iPad has a much bigger battery to deliver the required 10 hours of usage. We know its a dual core A5 but which version, my suspicion is a dual core version of the reduced size more power efficient A5 in from the ATV and also that battery looks pretty new tech. We know the retina displays are power hungry at the moment so maybe in a year when this tech has improved there may be a retina display in this device too.

The competition is selling at cost or close to cost devices that are no where near the build quality of this device. Apple have resisted the temptation to join the race to the bottom and created a quality product rather than a cheap product. Yes there will be a good markup but why not, its their core market unlike competitors who are hoping to make their profits from content or advertising. Closing the door on competition isn't going to happen because they are fundamentally different markets. Of course if you don't like it don't have to buy one, get a Nexus or Fire instead, maybe they will suit your needs better.

 

[onthecouchagain]

For consideration:

"At $329, it is believed that Apple will duplicate the 58% to 103% gross profit margin it enjoys on the third-generation Apple iPad."

-Phone Arena

 

[lilo777]

to be fair, the entire market dropped based off rumors of bernanke eventually leaving the fed chair post. apple along with everyone else was hit. a one time drop that seemingly happened coincidentally with the rest of every major stock conglomerated into the whole DJI isn't enough to claim AAPL went down because of the mini.

just as when they release their iphone 5 numbers, their stock will go up, but the market as a whole today is rebounding.

long term vs. random ***** of the day.

Just look at yesterdays charts for AAPL and ^IXIS (NASDAQ). There is no correlation whatsoever. AAPL bombed after product announcement.

 

[richsw]

"Yeah, why cheaper? You dorks buy anything with the fruit on it, even overpriced"

Mercedes Benz sells every car they make. You dorks buy anything with a three pointed star on it.

 

[RobertMartens]

The same people complaining about things like the iPhone 5, are the first Queueing overnight at an Apple store.

How do you know it is the same people?

 

[mantan]

The concept in marketing of 'price elasticity' is in play here.
Apple knows that they CAN GET $ 329 for this device, and will sell out, because their production will always lag behind the demand.

Later on, when they are readily available in stores (if ever), they can reduce the price, usually after the newer one comes out.

Apple is a master at limiting availability, therefore increasing pent-up demand, at higher prices than any competitors.

The reason it is priced at $ 329 is because they CAN! Who cares if it matches competitors tablets if they know they will sell out, regardless of price?

Bingo!!!!

The price is higher than most hoped. But Apple doesn't care because it' knows millions will line up to buy it.

As a consumer I hoped for a lower price. But Apple's main goal (like every other company) is to maximize profits.

The sheep are the people around here that seem to think Apple is motivated by anything other than money and are trying to justify the price under the tired arguments of 'premium product', 'innovation', 'for the ecosystem'.

The real hope is the competitors keep pushing and there is a truly competitive market out there. If customers vote with their wallets, the prices will edge down. Simple economics.

 

[Eidorian]

This tbh, as unfair as the pricing is, it will still dominate the smaller tablet market... It will probably even become ubiquitous, but I wouldn't be surprised if the next gen cuts down to 299.

The bigger disappointment for me is the premium you pay for cellular. All that extra $$$ and nothing more than an antennae; not extra HD space, no SD slot, no anything.

Cellular is a different chipset. Is it $139 worth of a different chipset? This hardly matters, if the added functionality sells for $139. Apple knows it does.

The premium is similar to add cellular functionality to notebooks.

 

[TheRainKing]

I don't see the big deal with the pricing. This is Apple we're talking about. They have always charged more for their products, even if other products on the market are theoretically superior. In the end, if you prefer Apple products, you will dish out the extra money. After all, that's what you've been doing all along.

 

[lilo777]

For consideration:

"At $329, it is believed that Apple will duplicate the 58% to 103% gross profit margin it enjoys on the third-generation Apple iPad."

-Phone Arena

Probably true. With outdated CPU and low quality display from AU Optronics, bill of materials should be below $100

 

[osofast240sx]

That its a better deal.

Just like a hyundai is a better deal than a BMW, both get u to point a to b. but BMW looks, feels, better 10 time more fun. So I pay more money for a better experience. Hence why I buy apple products

 

[RobertMartens]

You say old technology but compared to what?

Old means 6 months old

 

[AppleInLVX]

There was a time I'd buy this, but now I'll take that 350 bucks and use it to offset the value my iPad 3 just dropped thanks to your shenanigans, Apple. Buy this at 329 and you'll release a retina version within a year? No, thank you.

Fool me once...

 

[polaris20]

Several of Apple's tablet competitors, including Amazon and Google, are selling their products roughly at cost, preferring to make money on content, advertising, or other means associated with usage of their tablets. Apple, however, employs the opposite strategy in focusing on the hardware as its primary profit generator, making it difficult to match competitors on price. Still, many had hoped that Apple would be able to come a bit closer to its competitors' pricing.

This is something that seems to continually evade Internet armchair experts. They're different business models, plain and simple.

Also, while I like Android 4.1 and find the N7 to be a nice experience, the cheap feel of it as well as lack of useful apps is very noticeable. The Fire is even worse. it feels like junk, IMO.

 

[NIKKG]

If they put in an A6 CPU, Retina display and maybe start at 32 GB, than $329 isn't so bad, but an A5 and non-Retina display just isn't worth it. Who wants to use a 2 year old CPU? You know all the new games probably won't run on it well for much longer and probably iOS7 or 8 will run slow too, thats if your even lucky to get iOS 7 and 8.

 

[nagromme]

ArtRage, GarageBand, Procreate, Inkpad, Pages, Numbers, iMovie, Keynote, Textastic, iDraw, iTunes U, OmniGraffle, iPhoto, Bento, Omni Outliner, Diet Coda, Intaglio, Freeform, TouchUp, iTeleport, ReBirth. The list goes on and on (including more games than Android). Where is the equivalent list of Android apps truly AS GOOD as these? Not “hey, it’s in the same category... we’ll count it” but truly as good? The only Android app that I have seen approach that level is Photoshop Touch. Reviews of performance on Android have been poor, but it may be good on some. So there’s one.

Where are the rest of the great apps on Android? Where are the Android-ONLY great apps? I’d need something in return if I’m going to give up all the great iPad mini apps.

Throw in a bigger screen, 16GB storage (not 8), lack of malware, FULL restore when you get a new device, and much better construction, and you have a great deal. An Android device may be a bit cheaper but delivers FAR less.

Obviously, we all wish the mini were free though