How can Apple ward off iPad challengers such as Amazon’s $199 Kindle Fire tablet? One way, according to experts, is to offer the popular iPad 2 device at a much lower price – perhaps $299. Such a move could “seriously” impact the Kindle Fire and others attempting to gain market share by providing a low-cost alternative to the iPad. Others are dropping prices for another reason — nobody wants their tablets.
The analysis comes from DigiTimes, a Taiwan-based industry publication. The site suggests Apple will retain the iPad 2 even after launching its newest tablet later this year. The iPad 2 could drop to $399 for the entry-level model, slashing $100 from the current low price. If this sounds familiar, Apple followed the same route when it introduced the iPhone 4S, cutting the iPhone 4 price to $99 and offering the iPhone 3GS effectively for free.
Unlike several other Android-based tablets, Amazon’s Kindle Fire has established a spot as the No. 2 tablet by copying Apple’s ecosystem approach and catering to consumers looking for a more inexpensive alternative to the iPad. If Apple dropped the iPad 2 price to $299, the Cupertino, Calif. company could “seriously” impact the Kindle Fire’s cost advantage – returning the debate to comparing features. It is a feature-by-feature comparison where the iPad traditionally outshines rival tablets.
As for what we can expect for the upcoming iPad update, DigiTimes argues that Apple could capture the entry-level tablet consumer by dropping the iPad 2 price and entice advanced users with an iPad 3 that offers such features as an 8-megapixel camera and high-resolution Retina Display.
One proviso, though, on today’s report: DigiTimes is known for its hit-and-miss reporting. In December, the publication said Apple would unveil the new iPad at the January MacWorld Conference, although the company has not participated there since 2009.
The race to offer a low-price tablet can be intentional, such as from Amazon, or the side-effect of having a warehouse full of devices you simply can’t give away, such as RIM and its ill-fated BlackBerry Playbook. The Waterloo, Ont. company announced it will sell for $299 the tablet once priced at $699.