While we wait for tomorrow’s big iPad event, I thought it would be fun and informative to explore whether or not the next iPad (iPad 3 or iPad HD depending on which rumor you listen to) would drive massive upgrades for Apple.
Last week we ran a Mobile Nations survey on the state of tablet adoption. Now we have to keep in mind that the folks who come here to read about Apple products and fill out surveys about their use of Apple products are clearly early adopters. So your responses don’t tell us what the mass market is doing. But they do tell us what early adopters are doing. And that’s still useful. It's also important to remember that the survey wasn't just of iMore readers, but Android Central, CrackBerry.com, WPCentral, and webOS Nation as well. So we're dealing with more than just Apple enthusiasts.
Check out this statistic: In our survey, a whopping 73% of iPad 2 plan to buy a new tablet this year. The stats also suggest that interest in Windows 8 is significant, though. Of the 73% people iPad 2 owners who plan to buy a new tablet, a solid 18% of them plan to switch over to the dark side. No other competing platform has anywhere near that much interest from current iPad 2 owners in our survey.
We’re assuming that it’s a fact, at this point, that tomorrow’s iPad announcement will include a Retina display that's 4x the pixel density as the current iPad. This opens the door for Apple to leave the iPad 2 on the market at a lower price point.
Given the huge margins on iPads and the massive market opportunity that Apple is going after, I think it makes sense to keep the iPad 2 on the market at a reduced price. Lower prices will make it easier to go after the education market, for example.
A lower price also makes it easier to compete with the $199 price points of the Kindle Fire and BlackBerry Playbook. $499 for an iPad feels like a big stretch versus $199, but when you consider the larger size and super HD resolution, it’s compelling for those who can afford it. But if Apple could keep the iPad 2 on the market at a price that makes it easier to upsell people away from a $199 competitor, all the better.
So what about all the people who plan to upgrade? If the iPad 2 price gets cut as I’m hoping, then there will naturally be a flood of very low-priced “gently loved” Apple tablets hitting Craigslist and eBay.
The name of the game, for Apple, is to own mobile computing. They never owned the PC market and perhaps they never will. But they can dominant in mobile computing and I think an iPad 3/iPad HD along with a price cut on the iPad 2 is a great opportunity for them.