Apple Inc. introduced the iPad to great public fanfare back in April of 2010. The ability to take a top-notch web browser anywhere, at half the size of a laptop was a revelation. iPads are much less expensive than laptops as well, adding to its natural appeal. The world is also quickly becoming more internet-ready, with emerging global markets snapping up the iPad at an unprecedented rate. Now, iPad sales have been flagging for a couple of years, and Apple Inc. is looking for the new iPad Pro to bring back iPad’s market mojo.
You can definitely make the argument that the iPad is a victim of its own success. The iPad product is incredibly successful overall, with a 4th edition of the iPad Mini coming to market soon. Could it be expected to keep up the torrid sales pace over five years? Tablet sales are expected to drop another 20% this year, even with the new product releases. During a conference call, Apple Inc. CEO Tim Cook gave his assessment of the situation.
We are clearly seeing cannibalization from iPhone and on the other side from the Mac. And, of course, as I have said before, we have never worried about that. It is what it is. That will play out and, at some point, it will stabilize.
Indeed, the recently revised Mac home computer and iPhone 6 are taking sales away from the iPad. In a home computer market that is down almost five percent, Mac sales have gained share during this declining market, with plenty of pent-up demand for a fully updated home computer model. Since the iPad is more of a volume seller and low-cost alternative to laptops and PCs, Apple Inc. does not mind that more profitable products are getting a boost. Steve Jobs never worried about one Apple product losing out to another, as long as the sales were kept in the family. Cook channels this approach as well. After strong growth in the 2011 and 2012 sales years, sales have been flat or in decline since 2013, even with revisions of iPad 2 and the introductions of the iPad Mini line.
There have been some leaks about what the new Apple iPad Pro will offer, most notably a larger screen, estimated to be almost 13 inches versus 9.7 on the iPad 2. The device will be thicker, but not heavier. Over 75 percent screen-to-body ration is featured, exceeding the iPad 2 as well. New features expected include NFC (Near Field Communications) radio and the Force Touch input. Apple Insider sources report that iPad Pro will improve Bluetooth functionality through Bluetooth stylus with improved pressure sensors. A USB-C connector is a feature many users think is long overdue, and is heading onto the new top iPad model in the lineup.
Not largely talked about is market conditions have also changed. Real wages have been in decline the last few years and alternative unemployment figures show upwards of 15 percent are without work, and many more are not counted. Spending hundreds of dollars for a computer is not an option for many, which is something Apple cannot control. Getting the things desired have never been more difficult in a stagnant or declining economy, globally as well as domestically.
Apple Inc. has been historically very secretive surrounding the timing that new Apple products are going to reach the market, but usually they appear in the fall before Thanksgiving arrives. A good prospect for consumers with sales of a product flag is that pricing should be very competitive, but still higher than iPad 2. More size and more features means more price, but Apple Inc. has been known to pull out some surprises.
By Evander Smart
Photo by Tatsuo Yamashita – Creativecommons Flickr License