This morning Apple announced the iPad Mini: a 7.9" screen device which is essentially an iPad 2 with a smaller screen. (For the nit-pickers yes it has LTE, Dual-Band WiFi and a Lightning connector but in terms of performance it’s the same CPU, same number of pixels on the screen and likely the same amount of memory as an iPad 2) With the WiFi version still the best seller for Apple the majority of buyers will look at the iPad Mini and think: $60AUD cheaper for a significantly smaller screen? When buying a tablet most users want the bigger screen as the experience is more immersive and for the additional money the iPad 2 is the winner in that respect.
The only reasons to buy an iPad Mini will be: easier to use for longer periods (as it is much lighter than an iPad 2) and more portable (though still not as portable as an iPod Touch/iPhone). The Mini essentially fills out the space between the iPod Touch (4") and iPad x (10") in Apples tablet line up. Originally Steve Jobs quite aggressively pronounced 7" tablets would be DOA (Dead on Arrival) on an earnings call in reference to Apples competitors at that time. Clearly he believed that the money didn’t lie there initially and had pushed ahead with a 10" tablet design. The truth was there were plenty of people that wanted smaller tablets as evidenced by the sales of Nexus 7 and Kindle Fire tablets. Apple didn’t get it wrong - the 10" model is still the most popular tablet form factor in the world, but until now they have ignored a clearly significant slice of the tablet market.
People that are truly price sensitive will not buy the iPad Mini - they will stick with the Android alternatives. Many who wanted the iPad but couldn’t justify the $429AUD price tag will likely snap up an iPad Mini at $369AUD for a “it’s close enough” experience. In reality the iPad Mini is expensive* for what it is (compared to other iPad models) however the iPod Nano was considered to be in the same situation many years ago and still sold incredibly well.
Apple needed to make the iPad Mini to fill in its blind spot and now they have. Good for them and good for us.
- Clearly the incremental cost of a larger screen and case is not as significant as the core components (CPU, battery, camera, memory) make up the base cost of any iPad/iPod Touch device and set the minimum price it could be sold at.