iPad 3: Six Things Investors Need to Know
Apple is widely expected to announce the third edition of its iconic iPad tablet today. Here's what you need to know.
The tech world is running red-hot this morning as Apple (AAPL) is widely expected to unveil the iPad 3 today at 1:00 p.m. ET.
So here's what you need to know about the latest iteration of Apple's market-smashing tablet computer line:
1. It Might Not Be iPad 3 Day!
I hate to play Negative Nancy, but Apple did not officially announce that today's event would be centered around an iPad.
Here's the invite Apple sent to journalists, courtesty our friends over at The Verge:
Odds are that you are looking at a picture of the next iPad, given the size of the hand relative to the icons and the bezel, but it's not 100% official.
In the event that Apple does not announce iPad, expect the tech world to lose its collective, um, stuff -- unless Apple announces something even more interesting.
In addition, there are rumors that the device will actually be called iPad HD.
Naming a product after a technical specification isn't out of the question for Apple, given past products like the iPhone 3G and Powerbook G4.
2. It May Have a Revolution Touchscreen, and Not Just in Terms of Resolution
An upgrade in screen resolution seems obvious at this point since iPad 2 didn't receive one from the original iPad.
However, Apple saying "And Touch" leads me to believe that there is something bigger going on that may be more important than a sharper, higher-resolution screen.
PocketLint.com may have the answer, as it is reporting that the iPad 3 display will feature what is called haptic technology from Senseg.
Haptic technology allows touchscreens to have multiple textures, so depending upon what you're doing, the screen could feel rough, smooth, or something in between.
If you thought Siri was a great party trick, haptic technology could be an even bigger attention-grabber, and a great reason for people to pile into Apple stores to try out iPad 3.
For example, what if there was a DJ app that made the iPad 3 screen feel like a record? How cool would that be?
3. It Will Likely Be 4G, and That Might Not Be a Good Thing
Odds are that iPad 3 will be 4G-capable, giving it high-speed Internet access and dwarfing what's possible over 3G networks. This would be especially helpful in streaming video from the likes of Netflix (NFLX) and Hulu when out of range of WiFi signals.
However, if you're looking for a 4G iPad, be careful what you wish for. 4G smartphones are often hobbled by poor battery life, and if iPad 3 immediately takes off after release, Verizon's (VZ) and AT&T's (T) networks might be easily overwhelmed by the traffic load.
Therefore, there is an outside change that a 4G iPad might have so-so battery life without any discernible speed advantage due to slammed networks.
In terms of ancillary plays, a 4G iPad 3 would likely be very positive for Qualcomm (QCOM), which is a leader in the 4G communications chip market.
4. What Happens to iPad 2 Is Equally Important
There have been some rumblings out there that Apple could keep the iPad 2 on the market at a lower price than iPad 3, similar to how the company manages the iPhone line after new releases.
Should Apple keep the iPad 2 on the market at a price of $399 or less, it will put enormous pressure on the low end of the Google (GOOG) Android tablet market, which as I've illustrated, is a terrible place to be. (See: With Apple iPad 3 Coming, Android Tablet Market Should Be Shaking in Its Boots.)
Specifically, it could put pressure on the Amazon (AMZN) Kindle Fire and the Barnes & Noble (BKS) NOOK tablet products, which have taken 16% of the tablet market, largely due to their price advantages.
It would also be good for Apple to immediately lower the price of iPad 2 ahead of iPad 3's actual release date in order to keep unit sales flowing smoothly. If you recall, Apple stumbled in late 2011 as iPhone 4 sales collapsed as people anticipated the 4S.
5. This is Tim Cook's Time to Shine
Tim Cook has the unfortunate position of succeeding Steve Jobs, who was simultaneously the best CEO and best salesman in modern history.
Now, Mr. Cook did introduce the iPhone 4S, so he's no stranger to performing in front of a crowd. However, unlike that product, the iPad 3 is likely to be a major, major upgrade jam-packed with new features that need to be sold to the general public.
Steve Jobs was genius at selling because there was no bigger fan of Apple's products than him, so the heat is on Mr. Cook to deliver the same infectious enthusiasm -- a challenge given his more sober demeanor. (See: Three Key Challenges Facing Apple CEO Tim Cook.)
6. But Wait, There's One More Thing...
Retail inventories of the current Apple TV streaming box are running extremely low, so it is possible that Apple could also announce a new, upgraded model -- possibly as the "One More Thing" announcement that typically comes at the end of Apple keynotes.
There is also an outside chance, one that I'd regard as very small, that Apple will announce its widely expected television set at today's event. (See: Four Reasons Why iTV Will Be the Easiest Money Apple's Ever Made.)
If that happens, I'll be shorting Sony (SNE) faster than you can say "I WANT MY iTV!"
Copyright 2011 Minyanville Media, Inc. All Rights Reserved.
Daily Recap Newsletter