Apple's 128GB iPad: A premium product at a premium price

Apple's 128GB iPad: A premium product at a premium price

Summary: Will customers stomach the price tag of the new 128GB iPad?

TOPICS: iPad, Apple

A day following my confident prediction that Apple would not release a 128GB iPad 4, Apple announces it.

(Credit: Apple)

Awkward, but sometimes it is fun being wrong because it gives us new things to talk about.

The one part of the announcement that most interested me was the price of this new iPad--$799 for the Wi-Fi version, and a whopping $929 for the Wi-Fi plus cellular version. Apple's system of charging for storage bumps pays off dividends with this latest iPad.

16GB of NAND flash storage costs Apple around $10. Doubling this storage to 32GB increases the NAND costs by $20. NAND storage prices are quite linear (when adding chips as opposed to increasing the density of the storage), but Apple charges an additional $100 for this, which means an extra $80 of additional revenue per sale.

Things get better--for Apple, at least--with the 64GB model. Here, the storage costs increase to $40, but the company charges $200 over the price of the base 16GB model for this storage, which means an additional $160 of revenue compared to the base model.

At current NAND prices, 128GB costs approximately $80, but Apple charges a whopping $300 compared to the base 16GB model, which means an additional $220 in revenue per sale.

Is there a demand for a 128GB iPad? According to Apple, companies are "regularly utilizing large amounts of data such as 3D CAD files, X-rays, film edits, music tracks, project blueprints, training videos, and service manuals" and these users will "all benefit from having a greater choice of storage options for iPad."

The Cupertino, California-based company is clearly hoping that these buyers will pay this stratospheric premium for the extra storage. It remains to be seen whether people will actually pay the price of a decent notebook for a tablet running iOS.

Another question worth pondering: Is Apple trying to compensate for iPad cannibalizing Mac sales by introducing a higher margin tablet into the lineup?

Topics: iPad, Apple

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  • I won't!

    Their tablets are losing their edge, Several Android Tablets have the ability to add this much storage and, you can do that at a fraction of the price!
    • Do they run AutoCAD?

      Oh snap.
      • Umm

        Yeah, actually Autocad is available for Android Tablets. Anything else you would like to add?
        • The question was about iOS...

          ...and not about Android.
          At least take the trouble to read the question before shooting off your mouth and exposing your Android obsession.
          • Oh I see

            you're upset because you guys got blindsided by the Android Juggernaut.

            I have no obsession with Android, I do however dislike Marketing Giants that manipulate people with Misleading Claims and none are larger than Apple.
          • Have to ask, what juggernaut are you speaking of?

            We are talking tablets here so I would say you are dreaming if you think there is some kind of juggernaut. Now if you are talking about smart phones I would agree they have the market share, but still no juggernaut so nobody was blind sided by anything.

            So you dislike Apple, Google, MS and pretty much all the big names. Since they are all guilty of the same why is it you only attack Apple?

            Not specifically directed at you but if you feel you can learn from it by all means, people just need to grow up and realize we don't all want the same things. To each their own, don't worry about what somebody else prefers, it has no affect on you.
      • Yes. Can you iPad use Autocad with a digitized pen?

        no... ok.
        • It can; there are lot of digitized pen systems for iPad -- much more than

          ... for Android tablets.
          • digitizer pens

            Android doesn't need lots of incompatible systems.
            the mouse driver is part of Android OS unlike iOS which doesn't have any pointer driver built in so the APP has to directly handle the digitizer.
            The best digitizer pens for the ipad doesn't even come close to the integrated functionality of a Samsung Note S-pen.
      • eat crow much?

        Or just apple pie?
        • Pie

          Love my APPLE iPad mini.... my APPLE Pie.
      • Now allow me to school you further...

        Android Tablet with 32 Gigs and full size SDXC Card slot... Roughly $350

        SDXC 128 Gig Card Roughly $140

        Autocad WS FREE

        So, for $490 you get a 160 GIG Tablet (Possibly more if you want to buy more cards or they come out larger) that can run Autocad Workstation or Sketchbook Pro.
        • You can not compare "$350 Android tablet" to iPad, the difference in class

          ... of visual picture quality and performance is dramatic.
          • True. the ipad is so under class it is not even close to the android

            True. the ipad is so under class it is not even close to the android
            Russell Parker
          • Have you seen what's available in the Android market?

            Yes, we can compare because manufacturers of Android tablets have caught up or are almost there. There are several Android tablets that ARE currently in the same class as the iPad. Check out what's available in Android. Then come back and we'll be ready for your retraction.
          • I have and they don't.

            Care to actually post a specific machine so people can actually make useful comments.
            Apparently not.
          • Nexus 10?

            highest res screen
            A15 cpu
            made by the people who make Apple's retina screens for ipads.
          • The Nexus 10 does not satisfy the original requirements

          • iDroids what are you thinking!!

            You have to understand that the quality of the apps is heaps between the two, the amounts of bugs and how easy it is to hack a android is just to easy, plus the feel, look and even the quality is head over heal above all the iDroid makers.
            When i compare the screens all Samsung's displays have crap colour, it doesnt look smooth or realistic
          • ipad screens

            guess who makes the ipads retina screens?