By Mark Long / CIO Today. Updated April 16, 2012.
An article posted by the Chinese Web site NetEase on Monday continued to stoke rumors about Apple's possible third-quarter release of a so-called iPad Mini equipped with a 7.7-inch display and a price tag in the $249 to $299 range.
According to unnamed sources based in Taiwan, supply-chain arrangements with Chinese manufacturers such as the Hon Hai Group have already been made final for delivery of as many as 6 million units in this year's September-ending quarter.
Many industry observers believe a so-called iPad Mini makes sense for Apple because the iconic device maker will be facing potential threats to its tablet market supremacy throughout the remainder of 2012. For example, device-makers are expected to begin rolling out new tablet models based on Microsoft's dual-mode Windows 8 operating system for both PC and tablet form factors in time for this year's holiday shopping season.
Furthermore, Samsung Electronics recently unveiled a new lineup of lower-priced Galaxy Tab 2 and Galaxy Player devices that represents a more immediate challenge to Apple's domination of the tablet market. For example, Samsung's new 7.7-inch Galaxy Tab 2 model will be priced at $249.99 when it launches in the United States next week.
Though Piper Jaffray agrees with industrywide expectations that Apple will need to eventually release a lower-cost iPad with a 7.7-inch screen, the investment firm's analysts continue to believe that the so-called iPad Mini will not hit the tablet market until 2013.
"Our thoughts on the timing of the smaller iPad remain unchanged despite Samsung's [latest] Galaxy releases," said Piper Jaffray analyst Douglas Clinton in an e-mail Thursday.
The Tablet Screen Size Issue
Meanwhile, Samsung is testing the lower limits of the tablet market with respect to screen size. The mobile device maker is introducing two new Galaxy Player models with 3.6-inch and 4.2-inch screens that are priced in the $149.99 to $199.99 price range.
For Samsung, the launch of its latest round of Galaxy models is about providing options, said Gartner Research Vice President Carolina Milanesi. "Samsung is very good at maximizing its reach by doing different things," Milanesi said in an e-mail.
Gartner continues to believe that the 10.1-inch tablet form factor popularized by Apple's iPad is the ideal size for the widest array of device users. On the other hand, Milanesi sees value in Samsung's decision to test the lower limits of screen size through the launch of its new Galaxy Player offerings.
"It is a question of personal taste," Milanesi said. "Some users just do not like larger screens."
Milanesi believes the huge demand for Apple's iPhone cannot be attributed solely to its utility as a smartphone.
"Look how many people are still buying iPhones," she said. "In Europe, devices have only just started to get larger screens, and in Asia the larger screens have limited appeal."
Apple's iPad Heading Overseas
Apple will have ample opportunity to test the overseas appeal of its latest 10.1-inch iPad model. Later this month, the third-generation new iPad launches in more than 20 overseas markets.
On Friday, Apple's new iPad will become available for sale in the Asian markets of South Korea, Malaysia and Brunei and also take its inaugural bows in selected markets in Europe and the Caribbean as well as in Latin American countries such as El Salvador, Guatemala, Panama, Uruguay and Venezuela.
Apple's global iPad rollout will continue on April 27, when the new iPad hits the store shelves in Colombia, Estonia, India, Israel, Latvia, Lithuania, Montenegro, South Africa and Thailand. Moreover, Apple said it would continue to offer its prior iPad 2 model "at a more affordable price starting at just $399."