iPad Mini would be ‘bad business’ for Apple, says analyst

by Doug Drinkwater

August 10 2012

Apple's iPad Mini will reportedly go into production this month
Apple's iPad Mini will reportedly go into production this month

Apple looks set to announce a 7.85-inch iPad next month, but one researcher has questioned whether Apple is making the right move.

 “While ABI Research believes Apple has the technical capability to produce a smaller iPad, we also believe this is bad business for Apple”, said mobile analyst Jeff Orr, when speaking to TabTimes via email.

“Designing a tablet that is smaller in size does not mean that component and manufacturing costs are similarly discounted. In fact, miniaturization of technology product design often leads to increased costs for similar functionality”.

Orr went on to ponder whether Apple even needs to introduce a smaller tablet.

“With record numbers of iPads shipping last quarter and a global market share of 65%+, what is the motivation to introduce a lower-margin, higher-cost iPad Mini?

"It could be greed or to cover a competitor, but what risk could this be to Apple’s bottom line? On average, iPad average selling prices (ASPs) have been falling in excess of $25 the last couple of quarters, so you have to question whether Apple can afford to take the risk and accelerate that decline.”

The iPad Mini is expected to feature a 7.85-inch display, 16GB of memory and a price of around $299. Apple is reportedly to announce both the iPad Mini and iPhone 5 at an event on September 12.

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