No need for an eraser IMO, it's a digital tool and it doesn't need to emulate certain pencils that have erasers on the back. And I don't want Apple making it $198 because it can do the same thing from both ends.
When I need to erase I just press the eraser button with my empty hand and continue to use the precision tip on the pointy end. Great if they improve the Pencil in other ways, but it's one of the products as of late that Apple got pretty "right" on the first try...
I'm not sure why it would double the price to add eraser functionality. I don't think you even need to make the eraser side as precise as the writing end. It just needs to be quickly accessible. I like working on a full screen canvas without any other buttons/overlays, so an eraser would be a welcome addition.
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I only wish there was a place to store the pencil in the iPad kind of like the Samsung Note phablets. But it's not possible at its current thickness.
Do you really want a pencil as thin or thinner than current ipads so that it fits inside? I think the weight and thickness of the current pencil is a positive feature.
As for those suggesting attaching via the smart connector, I wouldn't be against this option. But that really only seems useful for those that don't use a keyboard or case that usually stays connected.