iPad mini Was Apple cautious making the iPad Mini?

[PracticalMac]

I always had the feeling that Apple was very cautious when they designed the iPad Mini.

• Non-retina screen.
• A5 (at the time iPhone 5 had A6 for year, and A6X in new iPad 4).
• including the same video driver (PowerVR SGX543MP2),exactly the iPad 2 SoC

Basically a shrunken iPad 2 with some minor updates to audio .

With the strong Steve legacy of 9.7" being the "perfect size" I suspect there was strong reluctance in Apple to make a smaller model unsure of how the market will react to it.
To that end, Apple decided to make an easier to made shrunken iPad 2.


Consider:
iPad 2 was released March 2011.
(Kindle Fire Nov 2011)
iPad 3 was released March 2012.
iPad mini (and 4) came out October 2012.

It may be that Apple was thinking about a smaller iPad 2 soon after it came out.
-or-
In response to the surprising sales success of Kindle Fire at the end of 2011 Apple was looking to make a competing 7" class product as fast as possible (while not taking away valuable manpower off flagship iPad 3. I am making an assumption that it takes a year for each new product to produce, despite the size.).


Discuss.

 

[irDigital0l]

Its pretty obvious.

No Retina, 1GB RAM, A6 chip, etc. because the iPad Mini 2 will have it.

Apple likes to save stuff for the next one.

 

[jterp7]

Its pretty obvious.

No Retina, 1GB RAM, A6 chip, etc. because the iPad Mini 2 will have it.

Apple likes to save stuff for the next one.

you forgot the 32/64/128gb that we've been expecting for years (base price points).

 

[TJ61]

I think their caution was in the form of targeting a ~$300 price point, and the bill of materials merely reflects that. It was, at least at the time, their lowest profit margin device, which I believe shows their commitment to that price point.

 

[Mr.C]

Its pretty obvious.

No Retina, 1GB RAM, A6 chip, etc. because the iPad Mini 2 will have it.

Apple likes to save stuff for the next one.

That's more of an assumption then fact.

 

[Chupa Chupa]

Even if a retina mini w/ decent battery life and $329 price point was possible last year why would Apple or any company shoot it's wad at the launch of the first product? If it's too good then there is less incentive to upgrade the next year.

 

[PracticalMac]

Apple was still making a sizable margin on mini.

Even if a retina mini w/ decent battery life and $329 price point was possible last year why would Apple or any company shoot it's wad at the launch of the first product? If it's too good then there is less incentive to upgrade the next year.

Because the 7" competition was seriously eating away at Apples lead.

IIRC, it was some 67% before Kindle Fire.
Now iPad line is about 43%.
Around 24% loss in a little over a year.

(of course the Android hardware and OS was not as good, but the good enough crowd snapped those up in droves.)

 

[javisan]

Its pretty obvious.

No Retina, 1GB RAM, A6 chip, etc. because the iPad Mini 2 will have it.

Apple likes to save stuff for the next one.

Yep, they can make the perfect device, they just won't make it. Leave the device purposely crippled somehow to force upgrade the year later when they "fix it" or add the missing feature. That is their business model, its been that way since the iPod days 10 years ago.

I do not like it, but it is what it is.

 

[Night Spring]

Yep, they can make the perfect device, they just won't make it. Leave the device purposely crippled somehow to force upgrade the year later when they "fix it" or add the missing feature. That is their business model, its been that way since the iPod days 10 years ago.

I do not like it, but it is what it is.

If you think that's what Apple does, and you don't like it, why do you buy their products?

 

[Internaut]

As a perfectly happy Mini owner, I've never fully understood Apple's rationale behind its launch. This is still a fairly new device, but shares the limitations of iPad 2. For example, if Apple decides iOS 8 is too much for IPad 2, then it will also be too much for the Mini.

Perhaps the iPad Mini gen 1 was a panic response to the emerging (and popular) smaller tablets from Google, Samsung and Amazon?

 

[IbisDoc]

Even if a retina mini w/ decent battery life and $329 price point was possible last year why would Apple or any company shoot it's wad at the launch of the first product? If it's too good then there is less incentive to upgrade the next year.

Because they don't want to develop a reputation for releasing obsolete products for the purposes of a cynical cash grab? Because they wouldn't want to fall behind the competition who easily accomplished the shooting of said wad? Because they wouldn't want their board to express concern about the failure to innovate?

 

[Chupa Chupa]

Apple was still making a sizable margin on mini.



Because the 7" competition was seriously eating away at Apples lead.

IIRC, it was some 67% before Kindle Fire.
Now iPad line is about 43%.
Around 24% loss in a little over a year.

(of course the Android hardware and OS was not as good, but the good enough crowd snapped those up in droves.)

Because they don't want to develop a reputation for releasing obsolete products for the purposes of a cynical cash grab? Because they wouldn't want to fall behind the competition who easily accomplished the shooting of said wad? Because they wouldn't want their board to express concern about the failure to innovate?

Clearly Apple has made a statement by increasing the price of the new mini that it's not chasing Android or market share numbers that don't tell a complete story. Apple will sell tons as usual. Apple's competitors are envious Apple can get the margins it gets. They'd demand them too if they could but you can't sell brass as gold. Apple is about making quality products but also doing so while being highly profitable. IPad market share is shrinking b/c there are more tablets around every day now. But iPad growth has not stalled.

IPad isn't for every one just as a luxury suit isn't either. I can go to Men's Wearhouse & buy a blue suit for $250. I can go to Nordstrom & get one for $600. I can go to Barney's & get on for $1600. I can have one custom tailored for $2500 or more. There is a market for each of those sectors.

 

[PracticalMac]

Clearly Apple has made a statement by increasing the price of the new mini that it's not chasing Android or market share numbers that don't tell a complete story.

Its not about chasing market share as offering something within the price range people are willing to buy.

Most people get a 7" class tablet becuase it is less expensive then full size tablets.

Now that the new iPads are announced, it will be interesting to see how they will do.
2 iPads of nearly identical design, just different sizes.

 

[Ledgem]

Most people get a 7" class tablet becuase it is less expensive then full size tablets.

Do you have any data to back that claim up? It's a rational idea, but when I look at the majority of people who have tablets they're all smaller-sized because anything larger would be difficult to carry around (work environment). I've seen some people make an effort with the larger-sized tablets, and for many I noticed that they switched over to the smaller tablets within a few months.

I can't speak for what people are buying and using at home, because I don't see that and I don't ask about it.

 

[Chupa Chupa]

Its not about chasing market share as offering something within the price range people are willing to buy.

Most people get a 7" class tablet becuase it is less expensive then full size tablets.

Now that the new iPads are announced, it will be interesting to see how they will do.
2 iPads of nearly identical design, just different sizes.

OK, but where is your evidence that enough people are not willing to buy iPads to make it a profitable venture for Apple? To date iPad sales have grown year over year even as less expensive, yet capable tablets have come to market. The mini has been a great successes for Apple. The retina model is $60 more than non-retina but for that money gets better screen, camera, processor & likely boost in RAM.

Also if it's not about market share why did you use that benchmark in your initial post?

People have been making your argument ever since the first iPad & I don't understand why. (Cook touched on it yesterday when he noted how iPad naysayers said the iPad couldn't compete with net books). Apple markets it's products as high end. The vast majority of Android tablets are marketed to bargain hunters & spec watchers.

As for the iPads being similar except size the same can be said of the MBAs. The main differentiator between the 7" & 13" is screen & the 13" has an SD slot. Consumers are not one size fits all.

 

[PracticalMac]

Do you have any data to back that claim up? It's a rational idea, but when I look at the majority of people who have tablets they're all smaller-sized because anything larger would be difficult to carry around (work environment). I've seen some people make an effort with the larger-sized tablets, and for many I noticed that they switched over to the smaller tablets within a few months.

I can't speak for what people are buying and using at home, because I don't see that and I don't ask about it.

OK, but where is your evidence that enough people are not willing to buy iPads to make it a profitable venture for Apple? To date iPad sales have grown year over year even as less expensive, yet capable tablets have come to market. The mini has been a great successes for Apple. The retina model is $60 more than non-retina but for that money gets better screen, camera, processor & likely boost in RAM.

Also if it's not about market share why did you use that benchmark in your initial post?

People have been making your argument ever since the first iPad & I don't understand why. (Cook touched on it yesterday when he noted how iPad naysayers said the iPad couldn't compete with net books). Apple markets it's products as high end. The vast majority of Android tablets are marketed to bargain hunters & spec watchers.

As for the iPads being similar except size the same can be said of the MBAs. The main differentiator between the 7" & 13" is screen & the 13" has an SD slot. Consumers are not one size fits all.

If there is a survey why people buy smaller tablets, no one released it, but the best example is when the Kindle Fire came out at a surprise low price of $199 it was a big seller (despite its limited app selection). Then the Nexus 7 at slightly more, and it also very fast, but the Nexus 10 was practically a dud.
The Nexus 10 is great for house and business, so why the low sales? Starting at $399, it is till $150 more then Nexus 7.

iPad mini 1 was $70 cheaper then iPad 2, and $170 less then A6X Retina screen iPad 4.
Why would normally performance minded people decide not to get the top line iPad and get a "good enough" model? Sure size is a factor, but I believe it was the $170 price difference (I believe the iPad 2 was mainly due to size over price)

And this is about market share. If not, why would Apple release a mini anyway?

Just remember, even a quarterly increase of 0.01% is still growth.
If your competition has quarterly growth of 25%, it will only take 1 year to surpass in total sales. One must compare to others, not an absolute.


In the OS game, numbers are a major metric. This was true in the Mac vs Windows years, they are true in mobile. See Symbian, BlackBerry, and WinRT, they need to numbers for the developers to feel like it is a profitable platform.


EDIT: Found this report

 

[IbisDoc]

Clearly Apple has made a statement by increasing the price of the new mini that it's not chasing Android or market share numbers that don't tell a complete story. Apple will sell tons as usual. Apple's competitors are envious Apple can get the margins it gets. They'd demand them too if they could but you can't sell brass as gold. Apple is about making quality products but also doing so while being highly profitable. IPad market share is shrinking b/c there are more tablets around every day now. But iPad growth has not stalled.

IPad isn't for every one just as a luxury suit isn't either. I can go to Men's Wearhouse & buy a blue suit for $250. I can go to Nordstrom & get one for $600. I can go to Barney's & get on for $1600. I can have one custom tailored for $2500 or more. There is a market for each of those sectors.

Maybe so, but don't confuse margins on the hardware with the company's overall profit as a result of sales of the hardware. One could argue that Apple is also envious of its competitors, since it has unsuccessfully tried to enter the advertising arena more than once. They NEED the margins to sustain their business model. Others don't. And that Men's Wearhouse stuff at the end makes no sense, since others made better quality tablets with retina displays around the same time the obsolete Gen. 1 mini was being hailed as a "luxury suit".

 

[crackbookpro]

They were extremely cautious for the debut as well as the next update... They knew they needed the iPad mini, and they know one day it will sell more than the iPad(or iPad Air now).

If you are asking were they extremely about the initial specs on the first model... 100% they were modest, the A5 chip was the quick ticker, and some other specs made me hesitate about older specs being put into a new device.

Nonetheless, Apple needed true product differentiation when the iPad mini debuts, and surprisingly, the iPad was made to 128GB without clear marketing couple months down the road to strengthen choices between certain consumers. This was a smart move, and differentiated the product more, but now they both offer 128GB for this update.

Personally, the iPad mini they just came out with yesterday(with the Retina display) - is the one(spec-wise) that should have came out last year(minus maybe the latest A7 chip)... this year should be about Touch ID, but next year will be about Touch ID with the iPads.

You brought up a very legit discussion that I think Apple knows all too well. When they know a product or feature is wanted - they wait. It's exactly what is going on with Touch ID now. Touch ID will be a slow roll out. And, undoubtedly, it should be here for these updates to the iPads.

 

[TJ61]

Personally, the iPad mini they just came out with yesterday(with the Retina display) - is the one(spec-wise) that should have came out last year....

They definitely could not have made that at the $329 price point, and thus it would NOT have sold like it did. I think the low price was a big part of the initial success of the mini, and I think the Gen1 will continue to sell well because of it.

 

[zbarvian]

I think their caution was in the form of targeting a ~$300 price point, and the bill of materials merely reflects that. It was, at least at the time, their lowest profit margin device, which I believe shows their commitment to that price point.

To add to this, I think they were boxed in with the iPad Mini with Retina display. Everybody was clamoring for a sharper resolution, and 2048x1536 was all that would've worked. And even if they had wanted to keep the SoC a generation older to entice buyers to get the iPad Air (which makes them more money but is selling worse), there's no way the A6X would've been efficient enough to keep the 10 hour battery life, even with the new ~50% larger battery. So to me it seems the parity between iPads was kind of accidental.

 

[crackbookpro]

They definitely could not have made that at the $329 price point, and thus it would NOT have sold like it did. I think the low price was a big part of the initial success of the mini, and I think the Gen1 will continue to sell well because of it.

I agree the iPad mini was all about price point for the market opportunity Apple foresaw for a smaller tablet/iPad, but the specs were nonetheless disappointment altogether for the mini debut. Apple did what they had to do...

I wouldn't doubt they sell the iPad 2 and the 1st Gen iPad mini for at least another 18months maybe more. I personally think both devices were drawn up before Apple exec's at the same exact time with some correlating specs/logistics.

They are their bread & butters... just like the iPhone 4s was for their iPhones. At one point, manufacturing gets cheaper for Apple, because they have a proven track record that they can fulfill contracts and usually go over them, then resign another contract at a more affordable rate & with more time allowed for each hardware co. In the meantime, the play the smart war of Software vs Hardware... which is ingenious.

Point being... the iPad 2 & iPad Mini(no retina) are getting cheaper & cheaper to manufacture, and at the same time create adoption for Apple's brand through a low-price point strategy. This is what Apple needs for the market, especially with these damn silly Android tablets popping up & fizzing out everywhere.

Right now, they have 3 bread & butter iOS devices, and they are old tech per se... but still selling well for Apple. And, Apple at the moment, would be stupid to stop production. The iPhone 4s is being phazed out... then the iPad 2 will be gone... then the very affordable iPad Mini 1st gen.