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While the technology giant Apple (AAPL) is expected to announce its highly anticipated streaming service next week, rumors circulating for months on new products that could also happen at this event. Given how the company has used March for the unveiling of an iPad, many reports point to new tablets that may soon come on the market. On Monday, Apple announced two new iPads, although the overall strategy was not as direct as some would have hoped.
(Source: Macrumors article on the new iPad mini, presented here)
Apple's end-of-year celebrations did not go as well as expected, as consumers faced high iPhone prices and the US-led trade war and China. The management having decided to stop declaring sales of units, investors and analysts began to worry that the number of products sold is not very important. In a previous article from Apple, I had explained why 2019 could be an interesting year in which management had to choose between unit sales and margins, because premium branding would not work forever.
With a possible revelation of new iPads in spring 2019, some wondered if the company would change its strategy for tablets. The iPad Pro of last year being very impressive devices, their prices were much higher than those of many previous versions. Many consumers and investors have been hoping for some time that Apple would launch a cheaper iPad, which would aim to conquer market share, but potentially at the expense of margins or lesser technical specifications. Some even thought that the long-awaited upgrade of the iPad could provide this lower price. That was not the case on Monday, when Apple was halfway there.
Let me start with the iPad mini 5 because it was the biggest upgrade we've seen. This is an extremely powerful device, with the new small screen tablet recovering the A12 Bionic chipset present in the latest iPhones, a major upgrade of the A8 chip of the fourth generation of the mini. The front-facing FaceTime camera also benefits from a significant upgrade from 1.2 megapixels to 7 megapixels and the first generation of Apple Pencil pencils is now also compatible. With all these improvements, the price remained stable at $ 399. It is therefore possible that the margin is affected, but this is not the lowest price device that some were looking for.
The other device launched was a new 10.5-inch iPad Air, which replaced the iPad Pro with the same screen size. This tablet also got a boost for the A12 Bionic chipset from its A10X Fusion, but it was the biggest upgrade here. The main difference is that this new device costs only $ 499, a little less than the price of $ 649 requested by Apple for the 10.5-inch Pro model. This type of effective price reduction could boost unit sales, although this would mean a small impact on average iPad sales prices.
The reason I say that this effort is halfway, is because Apple has not done anything with its other basic "iPad" model yet. The 9.7-inch screen model launched in the spring of 2018 is still on sale and costs $ 329. However, the specifications of this tablet are now a little outdated, considering that it only has the A10 Fusion chipset, 32GB of storage (ie half of what the new models have), as well as the old camera 1.2 MP FaceTime. For just $ 70 more, although you get a smaller screen, consumers could buy the much larger and larger mini-storage, or the 10.5-inch version for $ 170 more.
(Source: Apple iPad comparison site, see here)
In terms of value, I would have liked to see a price reduction on the one – year – old model, which would have been an effort to increase sales to unity and reduce some of the price. price scale. Maybe a new version of this tablet is about to arrive, and I'm sure some might even talk about it for the launch of the streaming service next week. But if that were the case, why not just announce it with these new iPads, or launch all three at the event? This makes me wonder if Apple will move the 9.7-inch display to a "Pro" version later this year, which means that the two models we just launched could be the cheapest at this time -the.
In the end, the new iPad consumer launched Monday are upgrades from their previous versions. However, the revelation did not really give us a clear idea of Apple's tablet strategy. The new iPad mini offers the same starting price, while the 10.5-inch model has gone from the "Pro" version to the basic version. At the same time, the old 9.7 inch version was maintained at its 2018 introductory price; those who hoped to have a much more economical tablet would be disappointed. For the shareholders, this decision really should not make much of a difference, especially if management no longer reports unit sales, and the main short-term goal will be mainly the streaming service event planned for Monday. next.
Disclosure: I / we have / we have no position in the actions mentioned, and we do not intend to initiate a position within the next 72 hours. I have written this article myself and it expresses my own opinions. I do not receive compensation for this (other than Seeking Alpha). I do not have any business relationship with a company whose actions are mentioned in this article.
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