iPad Mini A Great 7-Inch Tablet, But Price A Success Barrier

Yesterday at the Apple iPad Mini launch event I had a chance to play with the smaller Apple tablet for about 10 minutes. It initially did look and feel to me, contrary to the statements of Apple SVP Phil Schiller, like a “shrunken iPad.” However it was also immediately clear, as has been pointed out several times in other “hands on” reviews, that this is the best small tablet now on the market.

Apple may have built the best-quality 7-inch category tablet but the ultimate success of the Mini is far from certain. Why? Its price. I have been harping on this for several months.

Yesterday Danny compared the pricing of the Mini ($329 to start) to rival 7-inch tablets from Amazon and Google. Apple believes that consumers will be willing to pay more for a higher quality tablet; however I’m not so sure.

I have yet to use any of the new Kindle Fire tablets. However I own a Kindle Fire 1.0 and can say without hesitation that it’s mediocre as anything other than an Amazon content-consumption device. (The new ones are better undoubtedly.) Still, when it was introduced it broke new ground chiefly in terms of its rock-bottom pricing.

When Google introduced its much better Nexus 7 it was forced to match Kindle Fire’s $199 pricing. It sold well and quickly became the tablet to beat in the 7-inch category. Better Nexus quality at the same $199 price drove those Nexus 7 sales. Next week we’ll see what Google unveils at its October 29 event and whether it offers an upgraded Nexus 7 (in addition to a 10-inch tablet).

At the iPad Mini event yesterday in San Jose, California Apple took aim at the Google Nexus tablet and described it as a “stretched out smartphone” without any (tablet) apps. Those critiques are accurate yet they haven’t really undermined my experience with the device. Conventional web pages look OK and so do most smartphone apps, which in many instances do look stretched. What looks bad, however, are regular smartphone ads on 7-inch tablets. Here’s an example from the CBS news app on my Nexus 7:

As an aside I’m sure we’ll see many more apps optimized for 7-inch devices as well as new ad units designed to take advantage of the larger screen (the NY Times app is doing this successfully).

Apple priced the Mini at $329 probably to protect the iPod Touch ($299 to start) from being cannibalized. Had the Mini come in at $199 or $249 or even $299 it would instantly have killed most iPod Touch sales. Why would you want a touch (even for your kids) when you could have a Mini for the same or less?

So we get a $329 Mini . . . and a $399 iPad 2 . . . and a $499 iPad 4/retina display.

I’m sure Apple has thought very carefully about pricing but it may have miscalculated this time. For example, if the Mini had entered the market at $249 (maybe even $299) it would almost certainly be assured massive success among people seeking a smaller tablet. But $329 is going to give many people pause when two other credible 7-inch tablets are available for $130 less.

The fact that all the iPad (and presumably iPhone) apps work on the Mini is an argument in its favor. But I’m not sure that “ordinary consumers” are going to perceive all the nuances and quality differences that Apple has built into the Mini as justifying the premium. Some undoubtedly will and be happy to pay more.

But for those buyers who are price sensitive at all — and the majority are — “almost as good” at $199 is probably going to trump “best” at $329.

Related Topics: Amazon | Apple: iOS | Apple: iPad | Channel: Retail | Features & Analysis | Google: Android | Mobile Marketing


About The Author: is a Contributing Editor at Search Engine Land. He writes a personal blog Screenwerk, about SoLoMo issues and connecting the dots between online and offline. He also posts at Internet2Go, which is focused on the mobile Internet. Follow him @gsterling.

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  • http://www.facebook.com/jeff.mayland Jeff Mayland

    IMHO, when I buy a gadget that is in that price range I divide it up by how long I think I will use it. So if I was going to buy a 7″ tablet and the iPad Mini was $130 more. I would divide it by 24 months which equals 1 trip to Starbucks per month.

    If I were to compare features, support, and quality I would think that $5/month more for using an Apple made product over a untested, unsupported, android tablet is not an issue.

    My theory is that Android product manufacturers are in the business of selling on quantity rather then quality. For the most part, if you are only concerned with price then you are subject to manufacturers that are racing to the bottom and will usually have to make their products “cheaper” before technology can allow then to make a same or higher quality product at a lower price.

    From a look at consumer trends and tech spending on Apple products, it appears that people are more interested in owning a well made, well tested, product that is part of a larger ecosystem of products, all supported by 400+ Apple retail stores.

    My bet is that this will be the same for the iPad Mini.

  • http://twitter.com/RealPaul Paul Gilbert

    Been thinking along the same lines, the ipad mini is priced to protect the ipod touch. With all the upgrading this year, its a devise Apple must believe has a future. Of course perhaps the price of both is such that there is wiggle room for a price discount come the Christmas season?

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