According to Topeka Capital Markets’ Brian White, Apple’s rumored iPad Mini could outsell the current iPad model, although he doesn’t consider it as cannibalism. The analyst sees the smaller and cheaper tablet could affect 20 percent of sales of the current model, a number that is relatively minor.
Enlarging Apple’s Market Opportunity with iPad Mini
Prior to this, there were reports that Apple will release a smaller iPad with a screen size that ranges from 7 to 8 inches before the year ends. However, it is less likely that the smaller tablet will feature a Retina Display.
On the other hand, Sterne Agee’s Shaw Wu said that a more affordable iPad could undermine would-be competitors. It should be recalled that Microsoft and Google announced their Surface tablet and Nexus 7 respectively earlier this month.
White believes that the market opportunity for an iPad Mini could be larger than the current iPad model. Considering the given trends in developing countries like China, a smaller tablet priced between $250 and $300 can have a big impact in the market.
An iPad Mini would also find a success in the education market. That’s because a smaller and more portable device is more suitable for younger children, while schools would appreciate a lower price point.
There’s also the possibility of current iPad owners buying an iPad Mini for convenience. As White stated in a note to investors last Thursday:
We would not be surprised if certain customers end up owning both a regular-sized iPad and ‘iPad Mini,’ swapping between the two devices for different occasions. With the introduction of iCloud, the content on the two iPads can be automatically duplicated and thus easier to swap between Apple devices.
Taking Over Their Competitors
Even if the rumored iPad Mini were priced at $300, White doesn’t think that Apple will have a hard time luring potential buyers from a less expensive $199-worth of 7-inch tablet. That’s because he believes that the Cupertino-based company will produce a device that is considerably of higher quality than its competitor. There is also the issue of iCloud that enables Apple users to synchronize their files from various iOS devices.
Apple is expected to take the wraps off its iPad Mini this fall, together with the announcement of the next-generation iPhone and iOS 6. However, nothing has been verified yet. But in case an iPad Mini will become a reality, this could pose a serious problem to tablet manufacturers.