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Reaction to Apple's Reveal of the iPad Mini


Analysts and investors worry about the iPad mini's price.

MINYANVILLE ORIGINAL Apple officially announced the iPad mini today in San Jose, California. The iPad mini will have a 7.9-inch display and supports either Wi-Fi only connectivity or both Wi-Fi and LTE wireless connectivity. The basic model has a price tag of $329, and it carries 16GB in storage and has Wi-Fi only access.

Customers can begin pre-ordering the the tablet this Friday, the same date as the Microsoft (NASDAQ:MSFT) Surface RT tablet launch. It will be available starting on November 2.

Reaction to the iPad mini Announcement

A report from IHS iSuppli today (via Mashable) states, "The arrival of the smaller iPad will turbocharge the market for 7-inch tablets, helping the market to approximately double in 2012 and 2013." Specifically, IHS predicts 2013 will see sales increase by 96% from 34 million in 2012 to 67 million tablets.

If tablet providers sell 34 million units globally in 2012, total sales in 2012 will increase by 100% from 17 million in 2011.

However, when the price of tablet was announced, Apple shares dropped, and the company has finished the day down $20.64, or 3.26%, at $613.39 per share.

According to the Wall Street Journal, the $329 price for the basic 16GB version of the tablet caught some investors and analysts by surprise.

Bill Kreher, senior technology analyst at Edward Jones, expected a price of $299. He had hoped that Apple would price it more competitively with Amazon's (NASDAQ:AMZN) Kindle Fire HD tablet and Google's (NASDAQ:GOOG) Nexus 7 tablet.

Abhey Lamba, an analyst at Mizuho Securities, shared similar sentiments, stating, "[T]he $329 price point has left room for competitors to deliver alternatives."

According to Bloomberg, Erik Gordon, a professor at the University of Michigan, said, "At $329, it won't draw people from Kindles and Nooks."

Others are not as concerned about the price, though.
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The author has a position in Microsoft. s in stocks mentioned.
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