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Bryan M. Wolfe
| May 29, 2013
The iPad mini's Incredible Shrinking Price
The worst kept secret in tech is that the second-generation iPad mini will come with a Retina display. What is new is the increased likelihood that the next model could be priced significantly less than its predecessor, according to CNET. According to supply chain checks by Citi’s Asia-Pac Technology Team, the iPad mini 2 will be priced below $250. This change is attributed to Apple’s shift toward more inexpensive products. To back up their claims, Citi notes recent comments made by Apple's Chief Operating Officer Peter Oppenheimer. During Apple’s most recent earnings call, the executive stated, “We are managing the business for the long term and are willing to trade off short-term profits where we see long-term potential.” Apple doesn’t break out iPad sales according to model. However, the majority of the 19.5 million units sold during the second quarter were likely for the smaller tablet. And this came despite the iPad mini selling at a premium versus tablets from competitors like Amazon and Google. It should also be noted that IDC recently said that 229.3 million tablets would be sold during 2013. This compares to the 144.5 million units recorded last year. Of this year’s sales, IDC expects tablets smaller than 8-inches to take 55 percent of the market. At the same time, the average price of tablets has dropped to $384. In other words, dropping the price Apple charges for the iPad mini makes a lot of sense. This isn’t the first time that we’ve heard that a less expensive iPad mini could be on the horizon. In April, KGI Securities said that Apple could be considering launching a lower-priced model to better compete with Android-based devices in the $199-249 price range. The iPad mini 2 is expected to arrive in August or September. Besides including a Retina display, the model is likely to have a faster processor and better camera than the current model.