If they don't sell nine million this quarter, and it isn't expected they will, then why ramp to six million next year? That would be an absurd 72 million tablets sold next year. That's crazy!
Quote:
Originally Posted by Blastdoor
6 million per month = 72 million per year. That would be AMAZING and totally beyond what I would have thought possible.
First of all ramping up production to 6 million a month before release does not necessarily mean they plan on making or selling 72 million units next year.
Apple could simply be ramping up initial production to meet high early demand and then scale back production once they determine that demand has leveled out. Apple has a two month period to push as many iPads onto the market before the product is released; 12 million devices out of the gate would seem like a good start.
They did this with the holiday season by (reportedly) upping production to 3 million units a month in November. So if they were 2 million in October, and 3 million for November and December, then the most they could sell this quarter is 8 million, which isn't unreasonable in the holiday quarter. After the new year, they will probably switch just about all production over to the new model and scale current production way back to just a trickle. Tales of shortages will pop up all over starting in February.
6 million/month suggests a lower price point, which perhaps means subsidies through cell carriers for the cell enabled models. Certainly there will be a model of iPad 2 for Verizon's network. The Mifi adapter has to be a temporary answer.
My take on the last call was that they had been ramping to 2MM per quarter, starting in July, but didn't hit the 2MM mark until September. I thought they should have sold an extra 500k units, but that might be explained by lag time in the cycle. There is a delay between ordering equipment to produce more screens, getting it installed, starting production, and getting them to the final customer.
I don't remember the 3MM/month number. But, applying the same logic, there are two likely scenarios: Christmas rush/building inventory for the new version, or a ramp-up that takes a full quarter. Either way, we shouldn't see more than 6.5-7.5MM iPads for FQ1.
There's a difference between what Apple says, and what we read as rumors, but which are often written as fact, as is this six million per month figure. The three million figure was also not an Apple number, but a third party estimate. It's these "guesses" I'm questioning. I understand production lags, as I was a manufacturer back when.
I could handle a 10-15% increase in the iPod touch size, but much bigger would make it impractical as a pocket-size device.
Remember When we were all debating whether Apple should make a 6"-7" tablet, or a 10" model? Now that they've made the 10", I don't see 6"-7" as being the cards now. If 7" seems very popular with Android models (likely because of cost issues), then maybe Apple will follow.
But I think Apple wants to make a clear distinction between the two sizes. We know that Apple doesn't want people to be confused over product differences.
From what I've read, the $499 iPad parts costs are roughly $230, with major component costs
-- $80 Display
-- $30 SSD
-- $20 A4
-- $10 Case
If we assume that Apple's economies of scale have improved, manufacturing and yields have improved, and aggressive pre-orders/pre-payments and investments in mfg's plants -- I suspect that, say, 3 mm units per month the current $499 iPad could be manufactured for, let's say $150-$170.
If they could hit the $150 cost, then a sell price of $199 would yield 25%; $229 would yield 35% Gross Profit... not the best, but certainly acceptable.
There are several additional things that could be done:
-- Other A4/SSD based products (web server, home server) to further reduce overall parts costs across several product lines
-- Bundling with higher profit apps, content, subscriptions and accessories
-- iPad carrier subsidies - say, $25 per unit for the base iPad
-- Tethering plans
-- special direct sales to education / enterprise
-- Special promotions
In the special promotions I would suggest that they target the OLPC project with an iPad -- Buy 1, Give one, and offer the iPad at cost to participating countries/communities -- lots of workable possibilities here. BTW, some of those communities are in US and Europe.
First of all ramping up production to 6 million a month before release does not necessarily mean they plan on making or selling 72 million units next year.
Apple could simply be ramping up initial production to meet high early demand and then scale back production once they determine that demand has leveled out. Apple has a two month period to push as many iPads onto the market before the product is released; 12 million devices out of the gate would seem like a good start.
They did this with the holiday season by (reportedly) upping production to 3 million units a month in November. So if they were 2 million in October, and 3 million for November and December, then the most they could sell this quarter is 8 million, which isn't unreasonable in the holiday quarter. After the new year, they will probably switch just about all production over to the new model and scale current production way back to just a trickle. Tales of shortages will pop up all over starting in February.
I don't believe it. It's only a rumor they ramped to three million a month. No more than that. This is a rumor as well. I can tell you from the view of someone who was a partner in a manufacturing company that you don't ramp up that much, and then ramp down that much. You try to build inventory up over time before the heavy sales period without ramping up much. Ramping up costs a lot of money, and usually involves more production lines. It then costs a lot to ramp back down. apple, like most other companies, builds inventory up over time, before release.
Apple has always been one of the most conservative companies I know, with or without Jobs. Back in early 1992, when I ordered my Quadra 950, it was backordered almost 6 weeks. This has been a constant for them. I doubt they would actually make 6 million a month for a new product, and then cut back. Don't forget that Apple doesn't have their own production. They would have to convince Hon Hi to do this.
If we assume that Apple's economies of scale have improved, manufacturing and yields have improved, and aggressive pre-orders/pre-payments and investments in mfg's plants -- I suspect that, say, 3 mm units per month the current $499 iPad could be manufactured for, let's say $150-$170.
If they could hit the $150 cost, then a sell price of $199 would yield 25%; $229 would yield 35% Gross Profit... not the best, but certainly acceptable.
While I agree that they have some economies of scale in using the A4 in different products, I think it benefits the AppleTV more than iPhone/iPad. If the next generation iPad is using an A8 based processor rather than the A9, and without a significant boost in RAM then they might be in for some backlash.
But, the display cost is not likely to have come down, since that is the most constrained part in the assembly. To make it worthwhile to produce enough screens, price would stay fairly flat.
From what I've read, the $499 iPad parts costs for are roughly $230, with major component costs
-- $80 Display
-- $30 SSD
-- $20 A4
-- $10 Case
If we assume that Apple's economies of scale have improved, manufacturing and yields have improved, and aggressive pre-orders/pre-payments and investments in mfg's plants --I suspect that, say, 3 mm units per month the current $499 iPad could be manufactured for, let's say $150-$170.
If they could hit the $150 cost, then a sell price of $199 would yield 25%; $229 would yield 35% Gross Profit... not the best, but certainly acceptable.
There are several additional things that could be done:
-- Other A4/SSD based products (web server, home server) to further reduce overall parts costs across several product lines
-- iPad carrier subsidies - say, $25 per unit
-- special direct sales to education / enterprise
-- Special promotions
In the special promotions I would suggest that they target the OLPC project with an iPad -- Buy 1, Give one, and offer the iPad at cost to participating countries/communities -- lots of workable possibilities here. BTW, some of those communities are in US and Europe.
Those are parts prices, not cost to manufacture. That's appreciably higher, and must include packaging and transportation. According to indirect statements From Apple on "new" product costs, the iPad has lower margins than most of their other products, which is why Apple's margins have fallen the past two quarters, and why Apple is estimating it will remain lower. Their gross margins on this could be 30%. we certainly don't want it below that.
I also don't believe the $10 cost for the case. I think it cost more than that. A good $20, if not more. When Apple first began to make machined cases for the notebook line, Jobs admitted that they cost $100 more than the old cases to make. He said that cost would come down over time, and I'm sure it has. But still, it's expensive.
I think they could drop the old model (16GB, no 3G or GPS) to perhaps $399. Maybe even to $349. But they wouldn't want to cut too much into the new model's sales. Remember that unlike with the iPhone, these aren't subsidized prices, so we can't get a deal like Apple offers with the older model phone, where most of the price is still being given to them by the cell company. There, they're likely cutting the actual price by 15-20% to take $100 off the customer price. Maybe we will see a $199 subsidized price for the old iPad, as some companies are now beginning to subsidize them.
Ever since the iPad was first introduced... oh so long ago...
I've had this funny feeling in my gut that we're missing something here.
Something like the iPad is so inexpensive at $500 -- that someone will give it away to get you to buy their product. The prize in the cereal box, if you will.
I don't know whether that's someone selling language courses, wine/gourmet food of the month, real estate courses, subscriptions to whatever, home security, college degrees, automotive repair, woodworking...
I don't know what it is -- but I feel that there are uses we "computer guys" just don't see.
But, the display cost is not likely to have come down, since that is the most constrained part in the assembly. To make it worthwhile to produce enough screens, price would stay fairly flat.
Perhaps unlikely, but still far from impossible, is the initial cost of more IPS displays increasing per unit if they?ve had to source them from new manufacturers or plants.
Quote:
Originally Posted by melgross
I also don't believe the $10 cost for the case. I think it cost more than that. A good $20, if not more. When Apple first began to make machined cases for the notebook line, Jobs admitted that they cost $100 more than the old cases to make. He said that cost would come down over time, and I'm sure it has. But still, it's expensive.
A month ago I would have agreed with you wholeheartedly, but with the new MBAs having a milled aluminium top casing for the LCD, I wonder just how far Apple has come to shave off what I?d think is a fraction of a mm that increases the strength only a little. It?s certainly stiffer and thinner, but to go to that level for the top case shell seems extreme if the cost is still high. Then there is the Mac Mini?s solid aluminium casing which one could easily define as ?over engineered?.
Ever since the iPad was first introduced... oh so long ago...
I've had this funny feeling in my gut that we're missing something here.
Something like the iPad is so inexpensive at $500 -- that someone will give it away to get you to buy their product. The prize in the cereal box, if you will.
I don't know whether that's someone selling language courses, wine/gourmet food of the month, real estate courses, subscriptions to whatever, home security, college degrees, automotive repair, woodworking...
I don't know what it is -- but I feel that there are uses we "computer guys" just don't see.
Maybe Apple sees them!
There are lot's of uses for these things. We've seen articles showing just how many. I used my iPhone, and now my iPad to do audio measurement and recording. This replaces thousands of dollars of equipment I used to take with me. Now, a company has come out with a barbecue thermometer that has a Bluetooth radio in it that shows up on your screen remotely. Some of these things seem silly, but people like this stuff.
While I agree that they have some economies of scale in using the A4 in different products, I think it benefits the AppleTV more than iPhone/iPad. If the next generation iPad is using an A8 based processor rather than the A9, and without a significant boost in RAM then they might be in for some backlash.
But, the display cost is not likely to have come down, since that is the most constrained part in the assembly. To make it worthwhile to produce enough screens, price would stay fairly flat.
I was proposing that the current $499 be carried forward with most of the existing parts -- much like the 3GS iPhone is currently offered.
My hypothesis suggested 3 mm month current iPads; 3 mm month new iPad 2s.
The R&D costs, and the production setup costs on the A4 have been spent. I suspect that this years iP4 will be sold as the 3GS is currently being sold.
So if Apple can squeeze a few more years and maybe 50-100 mm more A4-based devices that's largely profit.
Don't know about display costs -- except the R&D and production setup have already been done them, too.
A month ago I would have agreed with you wholeheartedly, but with the new MBAs having a milled aluminium top casing for the LCD, I wonder just how far Apple has come to shave off what I?d think is a fraction of a mm that increases the strength only a little. It?s certainly stiffer and thinner, but to go to that level for the top case shell seems extreme if the cost is still high. Then there is the Mac Mini?s solid aluminium casing which one could easily define as ?over engineered?.
And a MacBook Air starts at $999. How much for the case? I wouldn't be surprised it it costs $100, remembering that the Air is a smaller machine. So I don't think $20-25 is out of line for the iPad. CNC machining is expensive, even when great numbers of product is being made. It costs up to $400 a minute for complex designs. Obviously Apple isn't paying that, but like everything else, costs don't infinitely drop with volume. There is a lower cost below which things can't be made.
Those are parts prices, not cost to manufacture. That's appreciably higher, and must include packaging and transportation. According to indirect statements From Apple on "new" product costs, the iPad has lower margins than most of their other products, which is why Apple's margins have fallen the past two quarters, and why Apple is estimating it will remain lower. Their gross margins on this could be 30%. we certainly don't want it below that.
I also don't believe the $10 cost for the case. I think it cost more than that. A good $20, if not more. When Apple first began to make machined cases for the notebook line, Jobs admitted that they cost $100 more than the old cases to make. He said that cost would come down over time, and I'm sure it has. But still, it's expensive.
I think they could drop the old model (16GB, no 3G or GPS) to perhaps $399. Maybe even to $349. But they wouldn't want to cut too much into the new model's sales. Remember that unlike with the iPhone, these aren't subsidized prices, so we can't get a deal like Apple offers with the older model phone, where most of the price is still being given to them by the cell company. There, they're likely cutting the actual price by 15-20% to take $100 off the customer price. Maybe we will see a $199 subsidized price for the old iPad, as some companies are now beginning to subsidize them.
I agree! I heard mfg costs of $10-20. But these are other people's numbers. Who can say how much Apple pays Samsung for the A4 -- since the A4 made it possible for Samsung to build their own chip and production facility at minimal cost.
Elsewhere, there is an article about a recent patent for an inexpensive case. So. I don't know:
I think keeping the current iPad around would make a ton of sense for the education market. I'm sure there are plenty of school districts that hate the idea of putting a video camera in an iPad.
Quote:
Originally Posted by SpamSandwich
I agree. A camera in an iPad for the education market would generally not make sense and even open school districts up to potential lawsuits. Keep the current middle-of-the-road-Pad available for schools.
Bingo! In a high school it might not make as much difference, but would be bad news for elementary and middle schools, where you have young kids.
My fear is that Apple, in their need to keep the # of SKUs down, may ignore this problem. There's a cost associated with managing additional models, as well as the game with "best seller" sales #s, which are higher when you have less models to choose from. The question is, is the K-12 market big enough in Apple's eyes to offset the other aspects?
Remember, in the past Apple has made certain models available only to educational channels. Personally, I hope they don't do that, and keep the existing model for sale to the general public at a reduced price, but I guess we'll find out in a few months.
Bingo! In a high school it might not make as much difference, but would be bad news for elementary and middle schools, where you have young kids.
My fear is that Apple, in their need to keep the # of SKUs down, may ignore this problem. There's a cost associated with managing additional models, as well as the game with "best seller" sales #s, which are higher when you have less models to choose from. The question is, is the K-12 market big enough in Apple's eyes to offset the other aspects?
Remember, in the past Apple has made certain models available only to educational channels. Personally, I hope they don't do that, and keep the existing model for sale to the general public at a reduced price, but I guess we'll find out in a few months.
Any school that has iPads for kids to use should be using profiles to lock them down.
Comments
I woild love it if my iPod Touch had a 7 inch screen!
I could handle a 10-15% increase in the iPod touch size, but much bigger would make it impractical as a pocket-size device.
If they don't sell nine million this quarter, and it isn't expected they will, then why ramp to six million next year? That would be an absurd 72 million tablets sold next year. That's crazy!
6 million per month = 72 million per year. That would be AMAZING and totally beyond what I would have thought possible.
First of all ramping up production to 6 million a month before release does not necessarily mean they plan on making or selling 72 million units next year.
Apple could simply be ramping up initial production to meet high early demand and then scale back production once they determine that demand has leveled out. Apple has a two month period to push as many iPads onto the market before the product is released; 12 million devices out of the gate would seem like a good start.
They did this with the holiday season by (reportedly) upping production to 3 million units a month in November. So if they were 2 million in October, and 3 million for November and December, then the most they could sell this quarter is 8 million, which isn't unreasonable in the holiday quarter. After the new year, they will probably switch just about all production over to the new model and scale current production way back to just a trickle. Tales of shortages will pop up all over starting in February.
My take on the last call was that they had been ramping to 2MM per quarter, starting in July, but didn't hit the 2MM mark until September. I thought they should have sold an extra 500k units, but that might be explained by lag time in the cycle. There is a delay between ordering equipment to produce more screens, getting it installed, starting production, and getting them to the final customer.
I don't remember the 3MM/month number. But, applying the same logic, there are two likely scenarios: Christmas rush/building inventory for the new version, or a ramp-up that takes a full quarter. Either way, we shouldn't see more than 6.5-7.5MM iPads for FQ1.
There's a difference between what Apple says, and what we read as rumors, but which are often written as fact, as is this six million per month figure. The three million figure was also not an Apple number, but a third party estimate. It's these "guesses" I'm questioning. I understand production lags, as I was a manufacturer back when.
I could handle a 10-15% increase in the iPod touch size, but much bigger would make it impractical as a pocket-size device.
Remember When we were all debating whether Apple should make a 6"-7" tablet, or a 10" model? Now that they've made the 10", I don't see 6"-7" as being the cards now. If 7" seems very popular with Android models (likely because of cost issues), then maybe Apple will follow.
But I think Apple wants to make a clear distinction between the two sizes. We know that Apple doesn't want people to be confused over product differences.
http://finance.yahoo.com/news/Is-The....html?x=0&.v=1
From what I've read, the $499 iPad parts costs are roughly $230, with major component costs
-- $80 Display
-- $30 SSD
-- $20 A4
-- $10 Case
If we assume that Apple's economies of scale have improved, manufacturing and yields have improved, and aggressive pre-orders/pre-payments and investments in mfg's plants -- I suspect that, say, 3 mm units per month the current $499 iPad could be manufactured for, let's say $150-$170.
If they could hit the $150 cost, then a sell price of $199 would yield 25%; $229 would yield 35% Gross Profit... not the best, but certainly acceptable.
There are several additional things that could be done:
-- Other A4/SSD based products (web server, home server) to further reduce overall parts costs across several product lines
-- Bundling with higher profit apps, content, subscriptions and accessories
-- iPad carrier subsidies - say, $25 per unit for the base iPad
-- Tethering plans
-- special direct sales to education / enterprise
-- Special promotions
In the special promotions I would suggest that they target the OLPC project with an iPad -- Buy 1, Give one, and offer the iPad at cost to participating countries/communities -- lots of workable possibilities here. BTW, some of those communities are in US and Europe.
First of all ramping up production to 6 million a month before release does not necessarily mean they plan on making or selling 72 million units next year.
Apple could simply be ramping up initial production to meet high early demand and then scale back production once they determine that demand has leveled out. Apple has a two month period to push as many iPads onto the market before the product is released; 12 million devices out of the gate would seem like a good start.
They did this with the holiday season by (reportedly) upping production to 3 million units a month in November. So if they were 2 million in October, and 3 million for November and December, then the most they could sell this quarter is 8 million, which isn't unreasonable in the holiday quarter. After the new year, they will probably switch just about all production over to the new model and scale current production way back to just a trickle. Tales of shortages will pop up all over starting in February.
I don't believe it. It's only a rumor they ramped to three million a month. No more than that. This is a rumor as well. I can tell you from the view of someone who was a partner in a manufacturing company that you don't ramp up that much, and then ramp down that much. You try to build inventory up over time before the heavy sales period without ramping up much. Ramping up costs a lot of money, and usually involves more production lines. It then costs a lot to ramp back down. apple, like most other companies, builds inventory up over time, before release.
Apple has always been one of the most conservative companies I know, with or without Jobs. Back in early 1992, when I ordered my Quadra 950, it was backordered almost 6 weeks. This has been a constant for them. I doubt they would actually make 6 million a month for a new product, and then cut back. Don't forget that Apple doesn't have their own production. They would have to convince Hon Hi to do this.
If we assume that Apple's economies of scale have improved, manufacturing and yields have improved, and aggressive pre-orders/pre-payments and investments in mfg's plants -- I suspect that, say, 3 mm units per month the current $499 iPad could be manufactured for, let's say $150-$170.
If they could hit the $150 cost, then a sell price of $199 would yield 25%; $229 would yield 35% Gross Profit... not the best, but certainly acceptable.
While I agree that they have some economies of scale in using the A4 in different products, I think it benefits the AppleTV more than iPhone/iPad. If the next generation iPad is using an A8 based processor rather than the A9, and without a significant boost in RAM then they might be in for some backlash.
But, the display cost is not likely to have come down, since that is the most constrained part in the assembly. To make it worthwhile to produce enough screens, price would stay fairly flat.
Here's an interesting speculation:
http://finance.yahoo.com/news/Is-The....html?x=0&.v=1
From what I've read, the $499 iPad parts costs for are roughly $230, with major component costs
-- $80 Display
-- $30 SSD
-- $20 A4
-- $10 Case
If we assume that Apple's economies of scale have improved, manufacturing and yields have improved, and aggressive pre-orders/pre-payments and investments in mfg's plants --I suspect that, say, 3 mm units per month the current $499 iPad could be manufactured for, let's say $150-$170.
If they could hit the $150 cost, then a sell price of $199 would yield 25%; $229 would yield 35% Gross Profit... not the best, but certainly acceptable.
There are several additional things that could be done:
-- Other A4/SSD based products (web server, home server) to further reduce overall parts costs across several product lines
-- iPad carrier subsidies - say, $25 per unit
-- special direct sales to education / enterprise
-- Special promotions
In the special promotions I would suggest that they target the OLPC project with an iPad -- Buy 1, Give one, and offer the iPad at cost to participating countries/communities -- lots of workable possibilities here. BTW, some of those communities are in US and Europe.
Those are parts prices, not cost to manufacture. That's appreciably higher, and must include packaging and transportation. According to indirect statements From Apple on "new" product costs, the iPad has lower margins than most of their other products, which is why Apple's margins have fallen the past two quarters, and why Apple is estimating it will remain lower. Their gross margins on this could be 30%. we certainly don't want it below that.
I also don't believe the $10 cost for the case. I think it cost more than that. A good $20, if not more. When Apple first began to make machined cases for the notebook line, Jobs admitted that they cost $100 more than the old cases to make. He said that cost would come down over time, and I'm sure it has. But still, it's expensive.
I think they could drop the old model (16GB, no 3G or GPS) to perhaps $399. Maybe even to $349. But they wouldn't want to cut too much into the new model's sales. Remember that unlike with the iPhone, these aren't subsidized prices, so we can't get a deal like Apple offers with the older model phone, where most of the price is still being given to them by the cell company. There, they're likely cutting the actual price by 15-20% to take $100 off the customer price. Maybe we will see a $199 subsidized price for the old iPad, as some companies are now beginning to subsidize them.
I've had this funny feeling in my gut that we're missing something here.
Something like the iPad is so inexpensive at $500 -- that someone will give it away to get you to buy their product. The prize in the cereal box, if you will.
I don't know whether that's someone selling language courses, wine/gourmet food of the month, real estate courses, subscriptions to whatever, home security, college degrees, automotive repair, woodworking...
I don't know what it is -- but I feel that there are uses we "computer guys" just don't see.
Maybe Apple sees them!
But, the display cost is not likely to have come down, since that is the most constrained part in the assembly. To make it worthwhile to produce enough screens, price would stay fairly flat.
Perhaps unlikely, but still far from impossible, is the initial cost of more IPS displays increasing per unit if they?ve had to source them from new manufacturers or plants.
I also don't believe the $10 cost for the case. I think it cost more than that. A good $20, if not more. When Apple first began to make machined cases for the notebook line, Jobs admitted that they cost $100 more than the old cases to make. He said that cost would come down over time, and I'm sure it has. But still, it's expensive.
A month ago I would have agreed with you wholeheartedly, but with the new MBAs having a milled aluminium top casing for the LCD, I wonder just how far Apple has come to shave off what I?d think is a fraction of a mm that increases the strength only a little. It?s certainly stiffer and thinner, but to go to that level for the top case shell seems extreme if the cost is still high. Then there is the Mac Mini?s solid aluminium casing which one could easily define as ?over engineered?.
Ever since the iPad was first introduced... oh so long ago...
I've had this funny feeling in my gut that we're missing something here.
Something like the iPad is so inexpensive at $500 -- that someone will give it away to get you to buy their product. The prize in the cereal box, if you will.
I don't know whether that's someone selling language courses, wine/gourmet food of the month, real estate courses, subscriptions to whatever, home security, college degrees, automotive repair, woodworking...
I don't know what it is -- but I feel that there are uses we "computer guys" just don't see.
Maybe Apple sees them!
There are lot's of uses for these things. We've seen articles showing just how many. I used my iPhone, and now my iPad to do audio measurement and recording. This replaces thousands of dollars of equipment I used to take with me. Now, a company has come out with a barbecue thermometer that has a Bluetooth radio in it that shows up on your screen remotely. Some of these things seem silly, but people like this stuff.
While I agree that they have some economies of scale in using the A4 in different products, I think it benefits the AppleTV more than iPhone/iPad. If the next generation iPad is using an A8 based processor rather than the A9, and without a significant boost in RAM then they might be in for some backlash.
But, the display cost is not likely to have come down, since that is the most constrained part in the assembly. To make it worthwhile to produce enough screens, price would stay fairly flat.
I was proposing that the current $499 be carried forward with most of the existing parts -- much like the 3GS iPhone is currently offered.
My hypothesis suggested 3 mm month current iPads; 3 mm month new iPad 2s.
The R&D costs, and the production setup costs on the A4 have been spent. I suspect that this years iP4 will be sold as the 3GS is currently being sold.
So if Apple can squeeze a few more years and maybe 50-100 mm more A4-based devices that's largely profit.
Don't know about display costs -- except the R&D and production setup have already been done them, too.
+FaceTime camera
+Cheaper prices (-$100? -$200?)
+Redesigned physical buttons (volume, lock)
+Better battery life
+Faster processor
+Greater storage capacities
+Built-in SD slot and/or mini USB
+Better speakers
I don't know if these are necessarily "iPad 2" features but some software I'd like to see:
+Built-in iWork to promote its office functionality
+Basic iPhoto or other iLife apps re-tooled for MultiTouch
A month ago I would have agreed with you wholeheartedly, but with the new MBAs having a milled aluminium top casing for the LCD, I wonder just how far Apple has come to shave off what I?d think is a fraction of a mm that increases the strength only a little. It?s certainly stiffer and thinner, but to go to that level for the top case shell seems extreme if the cost is still high. Then there is the Mac Mini?s solid aluminium casing which one could easily define as ?over engineered?.
And a MacBook Air starts at $999. How much for the case? I wouldn't be surprised it it costs $100, remembering that the Air is a smaller machine. So I don't think $20-25 is out of line for the iPad. CNC machining is expensive, even when great numbers of product is being made. It costs up to $400 a minute for complex designs. Obviously Apple isn't paying that, but like everything else, costs don't infinitely drop with volume. There is a lower cost below which things can't be made.
Those are parts prices, not cost to manufacture. That's appreciably higher, and must include packaging and transportation. According to indirect statements From Apple on "new" product costs, the iPad has lower margins than most of their other products, which is why Apple's margins have fallen the past two quarters, and why Apple is estimating it will remain lower. Their gross margins on this could be 30%. we certainly don't want it below that.
I also don't believe the $10 cost for the case. I think it cost more than that. A good $20, if not more. When Apple first began to make machined cases for the notebook line, Jobs admitted that they cost $100 more than the old cases to make. He said that cost would come down over time, and I'm sure it has. But still, it's expensive.
I think they could drop the old model (16GB, no 3G or GPS) to perhaps $399. Maybe even to $349. But they wouldn't want to cut too much into the new model's sales. Remember that unlike with the iPhone, these aren't subsidized prices, so we can't get a deal like Apple offers with the older model phone, where most of the price is still being given to them by the cell company. There, they're likely cutting the actual price by 15-20% to take $100 off the customer price. Maybe we will see a $199 subsidized price for the old iPad, as some companies are now beginning to subsidize them.
I agree! I heard mfg costs of $10-20. But these are other people's numbers. Who can say how much Apple pays Samsung for the A4 -- since the A4 made it possible for Samsung to build their own chip and production facility at minimal cost.
Elsewhere, there is an article about a recent patent for an inexpensive case. So. I don't know:
http://www.patentlyapple.com/patentl...cess.html#more
A $199 subsidized price would be acceptable, with the right data plan, or a slight premium to your smart phone plan for tethering.
I think keeping the current iPad around would make a ton of sense for the education market. I'm sure there are plenty of school districts that hate the idea of putting a video camera in an iPad.
I agree. A camera in an iPad for the education market would generally not make sense and even open school districts up to potential lawsuits. Keep the current middle-of-the-road-Pad available for schools.
Bingo! In a high school it might not make as much difference, but would be bad news for elementary and middle schools, where you have young kids.
My fear is that Apple, in their need to keep the # of SKUs down, may ignore this problem. There's a cost associated with managing additional models, as well as the game with "best seller" sales #s, which are higher when you have less models to choose from. The question is, is the K-12 market big enough in Apple's eyes to offset the other aspects?
Remember, in the past Apple has made certain models available only to educational channels. Personally, I hope they don't do that, and keep the existing model for sale to the general public at a reduced price, but I guess we'll find out in a few months.
Bingo! In a high school it might not make as much difference, but would be bad news for elementary and middle schools, where you have young kids.
My fear is that Apple, in their need to keep the # of SKUs down, may ignore this problem. There's a cost associated with managing additional models, as well as the game with "best seller" sales #s, which are higher when you have less models to choose from. The question is, is the K-12 market big enough in Apple's eyes to offset the other aspects?
Remember, in the past Apple has made certain models available only to educational channels. Personally, I hope they don't do that, and keep the existing model for sale to the general public at a reduced price, but I guess we'll find out in a few months.
Any school that has iPads for kids to use should be using profiles to lock them down.