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The markets are different. The iPad is for home/business use whereas the mini is more for commuters/e-readers. I use my iPad for websurfing in bed and taking notes in meetings. I prefer the larger size for those purposes. It's also great for video on a plane. If I commuted by bus or train, I would probably prefer the mini.
As mentioned and illustrated, Apple makes the bulk of their money off of hardware sales. Unlike Amazon, Apple sells their products (hardware) at a hefty profit for the most part.
In the end though, the iPad mini simply feels like an also ran, or a me too product.
Their business model is about dominating market share to create a quasi monopoly that one day might be valuable. It's closer to Walmart than a tech company.
Exactly. What did Apple say during the announcement?
"We've paid out more then 6.4 BILLION to app developers".
Billion, with a B. Now how much did Apple profit on that 6.4 BILLION? 10% would be 6.4 MILLION and I am sure it's more then 10%.
Apple takes a 30% cut on all app sales and in-app purchases.
As for the iPad mini, even at its (too high) price point, I think it will sell very well at least thru the holidays. Now beyond that is a bigger question mark.
Apple takes a 30% cut on all app sales and in-app purchases.
As for the iPad mini, even at its (too high) price point, I think it will sell very well at least thru the holidays. Now beyond that is a bigger question mark.
True. By that time, I am guessing they will offer an upgrade or a mini 2. I use my iPad in lieu of a laptop. If they offer an iPad at a lower price point with smaller capacity.
Amazon sells their kindles at cost or near cost. Which is a good way to move products, but hard to turn a profit. I sometimes wonder how Amazon is able to stay solvent. Somehow they have managed stay in the game and competitive for the last 17 years.
Amazon sells at close to cost, which is why the 32MB 7" Kindle Fire HD is $249 and the comparable iPad Mini is $429, nearly twice as much. (The base 16MB models are $199 and $329, respectively.) Add on the feature that the Mini can have that the Fire can not - 3G/4G - and the Mini is $559. On the other hand, the Fire comes with two external speakers which actually aren't all that bad. I've been playing with one for most of the weekend and am overall pleased, especially for the price.
For my uses, a tablet is pretty much a toy/media consumption device. Paying $249 for a device to keep me amused on long flights/commutes/car trips and stream music from Spotify and Pandora around the house/shop is steep, but nearly $450 is nuts, considering my last full-featured 13" Lenovo laptop was $449 and runs productivity rings around any tablet. For $449 for the laptop, $70 for a dedicated e-reader and $199 for a Fire media device, you've got every base covered and for less than a regular iPad.
YMMV - you may be someone who actually gets the iPad to do something actually productive and I clearly don't. If I have work to, I toss my iPad v1 aside and haul out the laptop. If you are already deeply into the the Apple architecture, the Mini may be the way to go because of the apps you already own
Location: Charlotte,NC, US, North America, Earth, Alpha Quadrant,Milky Way Galaxy
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Quote:
Originally Posted by Skunk Workz
Hardware profit is irrelevant on these devices (Amazon dumps their newer tablets at a loss).
Apple makes far more money from their cut of apps, music, movies, e-books, etc.
Hmm, not sure if that is completely true. That model is popular with those who OEM the OS and hope that the "platform" will generate revenue from other services and products sold. Apple makes TONS of money b/c they control the entire ecosystem. Increasing cost of manufacturing definitely reduces profit - wouldn't say apple doesn't care. I think they are betting people won't care how much it is, but rather that it's an apple device and I can fit it in my purse/backpack/briefcase.
I don't know, it's goign to be very interesting. Windows 8 is hitting and for now, there is a sizeable buzz. There's definitely a full court press on Apple from multiple fronts.
Location: Charlotte,NC, US, North America, Earth, Alpha Quadrant,Milky Way Galaxy
3,770 posts, read 7,546,456 times
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Quote:
Originally Posted by Peregrine
Exactly. What did Apple say during the announcement?
"We've paid out more then 6.4 BILLION to app developers".
Billion, with a B. Now how much did Apple profit on that 6.4 BILLION? 10% would be 6.4 MILLION and I am sure it's more then 10%.
I hear what you're saying...it's $6.5Billion over the lifetime of apps in itunes (since the beginning) paid to devs. Apple takes 30% of gross from that so it's < $3Billion. Don't get me wrong, that's a lot, but it's only been $3Billion over 4 years (I went back and checked, the app store has only been selling apps since 2008! Jeez thought it was like 10 years lol).
My point is the apps aren't a big source of revenue, "the product" itself is.
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