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Author Topic: What Will Apple’s Big Tablet Cost?  (Read 2003 times)

Offline javajolt

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What Will Apple’s Big Tablet Cost?
« on: July 25, 2009, 06:35:01 PM »

If Apple doesn't introduce a tablet computer soon, we'll all be sorely disappointed. With all the ongoing speculation about the alleged iPod-on-steroids, I feel like the device is already here.

Today's scuttlebutt from Apple Insider has the Big Tablet arriving early next year, a prediction that matches one two months ago by Piper Jaffray analyst Gene Munster.

So what do we know about the tablet? Reports say it's an iPod-like device with a 10-inch screen, a handheld slate that's large enough for HD movies, video gaming, and Web browsing without all the window-resizing and screen-tapping calisthenics that smartphone users endure. Apple Insider says the tablet will feature 3G broadband, which seems logical. And since we're speculating here, I'd like to request Wi-fi, Bluetooth, and GPS as well.

Name Your Price
Specs aside, what should Apple charge for the Big Tablet? Some reports say $800 is likely, but that seems high for a consumer electronics device. My prediction: $499. Here's why:

According to a 2007 study by the Consumer Electronics Association (CEA), the average American household spends about $1200 annually on electronics products. Would the typical household blow two-thirds of its tech budget on one handheld device? Probably not.

And that CEA study was two years ago -- before the current recession and consumers' belt-tightening ways. To me, $500 seems like the sweet spot for a premium consumer gadget.

And then there's Apple's product lineup. Currently, there's a big gulf between the 32GB iPod touch ($399) and the $999 MacBook. Let's assume Apple drops the iPod touch price, as it did recently with some of its MacBooks.  The Big Tablet would fill the void nicely at $499.

Of course, for Apple to achieve its desired profit margin, that $500 price tag may include a 3G service contract with a major wireless carrier. Given the enormous success of the iPhone, it wouldn't be surprising if AT&T, Sprint, or Verizon would be willing to subsidize the tablet's cost to sign up new subscribers. Netbooks with wireless-style plans are becoming increasing common, so the subsidized model for consumer hardware is already in place