A leaked inventory system screenshot has purportedly leaked the pricing scheme behind Apple's upcoming 7-inch tablet, dubbed the iPad mini.
The base price of the iPad mini (8GB storage, Wi-Fi only) is set at €249, or $320 at the current exchange rate, according to German site MobileGeeks (via GigaOm). The leaked screenshot is reportedly from a widely used inventory system in Europe and Asia used by mobile firms and cellular networks.
Here's the pricing scheme as it's being reported:
|iPad mini (Wi-Fi, 8GB, Black/White)||€249||~ $320|
|iPad mini (Wi-Fi, 16GB, Black/White)||€349||~ $450|
|iPad mini (Wi-Fi, 32GB, Black/White)||€449||~ $580|
|iPad mini (Wi-Fi, 64GB, Black/White)||€549||~ $710|
|iPad mini (Cellular, 8GB, Black/White)||€349||~ $450|
|iPad mini (Cellular, 16GB, Black/White)||€449||~ $580|
|iPad mini (Cellular, 32GB, Black/White)||€549||~ $710|
|iPad mini (Cellular, 64GB, Black/White)||€649||~ $840|
(It's worth noting that Apple tends to synchronize prices across continents, even if they don't necessarily translate at the currency-exchange level. It goes almost without saying: until Apple announces the device, pegged for October 23 according to numerous reports, the pricing at this point may not be accurate.)
The iPad mini, which may not be its final name, has been on the tip of the technology world's tongue for months as Amazon, Google, and Samsung continue to dominate this almost-niche section of the 7-inch tablet market. Apple has yet to capitalize on this lucrative market, based on sales figures from the companies' quarterly earnings reports.
There are a few things to consider with the iPad mini. To wit:
Cellular conundrum: The Guardian (via CNET) said that the iPad mini will not include cellular connectivity, citing unnamed industry sources. The leaked pricing figures suggest that Apple has a cellular version of the iPad mini ready to roll out. But cellular devices cost more than wireless networking devices. It boils down to the profit margin figures.
Should the device come without 3G or 4G LTE connectivity, Apple also avoids the headache over selling the expected device without facing the hassle of building different LTE hardware models for the requirements of each cellular network.
That said, the leaked pricing suggests that at least some cellular connectivity may be on the way. Apple could avoid the 4G LTE headaches by simply include 3G connectivity. How this compares to the production costs of including 4G LTE connectivity remains unclear.
Pricing: The pricing leaves little to be desired between the 7-inch iPad mini and the 4-inch iPod touch -- two devices that are for all intents and purposes the same device -- (if the iPad mini does include cellular connectivity, include the iPhone into the iPod touch mix) -- because the prices do not suggest a stable middle ground between the smaller and larger tablet-esque devices.
The iPad 3 pricing starts at $499 while the iPad 2 starts at $399. ZDNet's Adrian Kingsley-Hughes suggests the ideal price would arrive in at below $299 to remain competitive with its larger 9.7-inch counterparts. The new 4-inch iPod touch starts at $299 which isn't a far cry away from the estimated $320 price tag of the base version of the iPad mini.
Apple's profit margins are typically high. Recent Apple v. Samsung court filings show the iPhone alone has a profit margin of between one-quarter and one-third. It's likely Apple will balance two crucial elements -- competing 7-inch tablets, while negating a price disparity between the 4-inch iPod touch and the 9.7-inch iPad -- but exactly how it'll manage this one is anybody's guess.
Either Apple will 'do an Amazon' and sell the iPad mini at a loss or at a fraction of the profit margin of the iPod touch and iPad, or it will bump the price of the iPad mini and retain a modest profit margin while keeping the pricing balance right across its range of iOS-powered devices.
Enterprise value: A smaller iPad will shake up the 7-inch tablet market for sure. Amazon's Android-powered Kindle is a thin-client designed to consume the company's cloud services. Samsung is a hardware company through and through and leaves Google, the Android mobile operating system maker, to the cloud services with Google Play. Apple is in almost the same position: it's part-hardware maker, part-cloud provider. For the business market, however, the cloud and apps don't matter. Businesses have their own clouds, their own sideloaded apps, and their own infrastructure.
If Apple nails the $399 price point or less, it will be a short-term fix for Apple, ZDNet's Larry Dignan explains. All eyes will be on Microsoft's Surface -- the true 'business' tablet -- which has yet to make a pricing appearance. If Apple is able to nail down the price to a sub-$399 figure and take on Microsoft at its relatively new game, it can blow Amazon's Kindle at $199 out of the water.