<span style="font-family:verdana, geneva, lucida, 'lucida grande', arial, helvetica, sans-serif;line-height:normal;background-color:rgb(250,250,250);">My theory is ... Apple is doing their best to find the mole/leak coming from their high profile meetings. </span>
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<span style="font-family:verdana, geneva, lucida, 'lucida grande', arial, helvetica, sans-serif;line-height:normal;background-color:rgb(250,250,250);">For example ... Tim Cook privately setup `Meeting One` for 20 people. Cook mentioned "iPad Mini" to 'em. Tim Cook also setup `Meeting Two` for 20 more different people. He mentioned "iPad Midget" to 'em.</span>
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<span style="font-family:verdana, geneva, lucida, 'lucida grande', arial, helvetica, sans-serif;line-height:normal;background-color:rgb(250,250,250);">So whoever leaked "iPad Midget" coming from his profile meeting then he knows that Meeting Two is responsible, not the other. He will hammer 'em down till the last one who was the responsible for it.</span>
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<span style="font-family:verdana, geneva, lucida, 'lucida grande', arial, helvetica, sans-serif;line-height:normal;background-color:rgb(250,250,250);">Hope this make sense.</span>
He might have to hammer himself since all these sound like planned leaks. Nice black on white btw.
And Apple doesn't need to sell YOU on a 7" iPad, they only need to sell a few hundred thousand other people on it to make it worth their while to produce.
I'd go so far as to argue for two more iPad sizes for a total of three models:
7" iPad Go
9.7" iPad
~14" iPad Pro
The 7" iPad would be great for those who want ultimate portability, and the 15" for fat-arsed couch potatoes who use it for surfing and pr0n. Maybe even slap an Ivy Bridge CPU (or comparably powerful) in the Pro and offer it with a wireless sketch tablet and it may become a Photoshop/Illustrator monster. Market the 10" iPad to average consumers and gimp the 7" enough so it doesn't eat into the 10" version's sales. For many people, an iPad is enough to fulfill all their computing needs.
Here's the problem with oversimplification, Apple runs a business that needs to be taken seriously in the financial community and they have to consistently perform at or above market expectations. With the iPad they currently have an opportunity that is contributing significantly to revenues and will do so for the foreseeable future.
Apple, at its current scale, can't afford to create product lines that sell in the "few hundred thousand" units. Apple TV, which they have always called a "hobby" has sold some where in the neighborhood of 4 million units since its introduction, or barely a blip on Apple's financial radar.
The Kindle Fire is a feature-crippled device that is effectively sold at cost. Apple is not about to market a similarly crippled device so they can sell it a minimal profit. It's not a good business decision. That's not to say they won't be in a position to do so at some point in the future, it's just not viable now. You won't be seeing a $299 or under Apple tablet anytime soon. If they did introduce one it could possibly be in the $399 to $449 range. That would certainly test whether the smaller format has a market.
At those price points I suspect it isn't an iPad at all, but a high end ebook reader
Why is that? The current iPad 2 only costs that much to make. So Apple doesn't make more then 40 percent margin on a device, is that so bad. Apple could take off 20 percent off across their product board and they would still make more money then every computer company out there.
If Apple reduced its profits by 50% the stock price would collapse. Whether you agree with it or not, Apple is a business that is accountable to the shareholders. Apple can't just decide to be charitable.
Here's the problem with oversimplification, Apple runs a business that needs to be taken seriously in the financial community and they have to consistently perform at or above market expectations. With the iPad they currently have an opportunity that is contributing significantly to revenues and will do so for the foreseeable future.
Apple, at its current scale, can't afford to create product lines that sell in the "few hundred thousand" units. Apple TV, which they have always called a "hobby" has sold some where in the neighborhood of 4 million units since its introduction, or barely a blip on Apple's financial radar.
The Kindle Fire is a feature-crippled device that is effectively sold at cost. Apple is not about to market a similarly crippled device so they can sell it a minimal profit. It's not a good business decision. That's not to say they won't be in a position to do so at some point in the future, it's just not viable now. You won't be seeing a $299 or under Apple tablet anytime soon. If they did introduce one it could possibly be in the $399 to $449 range. That would certainly test whether the smaller format has a market.
Apple has the ability to build a proper Apple 7.85" tablet for $200 cost, sell it for $279 (~25-30% margins). Not only that but they would sell 16GB at $329 and 32GB at $399 or $429 (super margins) and across that range would sell millions. Average margin would be set by the mid-range model since that seems to be the best seller for most Apple lines. Note that although Apple's average OM is 41% that is massively because the iPhone is insanely profitable. iPads are everaging in the 30-40% range, Macs in the 20-30% range overall. You don't need to be iPhone profitable to succeed in Apple.
People would buy them like the Fire at Christmas but love them, keep them and tell everyone they know. The larger, more resource intensive iPad 2 BOM is estimated at $237. It would not be crippled, it would be a trade-off situation - using the 28nm A5, offer 2/3 the screen area with similar but probably lower battery life. The smaller form factor has an obvious market that may be the same or larger than the 10" market and Apple would be nuts to miss out on it. Apple knows far better than you how to set product specs at overlapping price points that sell to the appropriate customers and mitigate excess cannibalization. Why on earth (if Apple can build it) should they not take an entire major market segment away from the competitors. iPad is like iPods - Apple can and should control the entire market. There is no impediment like the carriers to stop them. There are Apple margins to be made at every major price point. My full argument is laid out at entry #74.
Don't be paralyzed by the Macs example. It is the anomaly, where cherry picking the high-end of a mature commoditized business is the right move. This is neither mature nor commoditized. Hell, it is not even well defined. 70% of the current market is irrelevant if the current market is only 20% of the available market. iPhone has shown that if you leave key market segments alone, others will take them and you may never get access to them again. Samsung is proving that it can be highly (if not Apple=like) profitable in mid/lower end smartphones and that base will provide them a very strong platform to take on Apple at the high-end once smartphone market saturation occurs. It is always easier to upgrade your own customers that steal someone else's, something they have proven and Nokia has singularly failed to grasp.
This is like iPods in 2004. Apple saw the light in releasing the mini and never looked back. This is that moment for tablets. Before others can really respond.
I already bought a sub 250$ 7" iPad in the Galaxy Tab 2 7" and it came with a universal remote app that also works with IR devices natively. It's all I've ever wanted out of the iPad, and it's something the iPad will never have. Apple can kiss it.
Too bad you've overpaid for an oversized remote, as that's about all the device is useful for.
Too bad you've overpaid for an oversized remote, as that's about all the device is useful for.
Know what? Not only is that perfectly right, you've given me the answer that will solve everyone's problems.
No one needs to be using two remotes when they have an Apple TV (the box). Have all TV manufacturers build Bluetooth 4.0 into TVs. Then let anything with Bluetooth act as a remote for any TV.
Then you can just use your iDevice as the remote for the Apple TV and simultaneously control the menus and whatever on your television.
I really hope they get more storage at a reasonable price. You can get a 32GB thumb-drive for $20 these days. Why is it an additional $200 to go from 16GB to 64GB? And I get it (engineering, cost of materials, different flash used than thumbdrive, etc.). The 64GB iPod touch should be at $199 by now.
Ah, the old question of flash storage.
There's a lot of misunderstanding about flash pricing out there. There are several types of flash memory. Without getting technical I'd like to give a short reason why Apple can't use flash made for a USB stick.
Reliability is the biggest issue with flash. We go from very reliable memory used for expensive enterprise drives at about 50,000 to 100,000 writes lifetime per cell, all the way down to 250 to 500 writes per cell for the typical flash USB stick.
In between is the 3,000 to10,000 write per cell SSD drives sold for consumer use, and for the better phones and for tablet use.
That memory costs a lot more than the cheap, but short lifetime memory used in a USB stick. USb sticks aren't expected to be used a lot. They are for taking files off, and transporting them somewhere else. If they're used a few hundred times, then thrown away, nobody thinks much of it.
But for a smartphone or tablet, that won't do. They need to have the memory usable for years, at constant use levels. With what's called "leveling" that can be done with the mid level flash these manufacturers use. But it can't be done with the cheap flash used in cheap USB sticks.
This is why it's not recommended to use a large USB stick as a startup drive in regular use. It will degrade too quickly.
It's possible that some secondary tablet manufacturers are using this cheaper memory. I can't say. But it's a very bad idea.
I'd be very nervous if I were you. Steve Jobs may just rise up out of his grave and git you for even using the word stylus and iPad in the same sentence.
This really a terrible misconception! It simply isn't true about SJ's feelings about a stylus. He didn't hate the idea of a stylus being used with an iPhone or an iPad. What he was against was the requirement that a stylus be needed.
I don't remember now, but I think it was when I bought my first iPad, the iPad1 with 3G, in May of 2010, that I was asked by the Apple sales person if I wanted a stylus with my new iPad. I said yes, as I was planning to get one anyway. If SJ was so against stylus's, he would never have allowed them to be on sale in Apple's stores, or on their web site.
Apple is smart enough to know that there will be some people for whom a stylus is a very important addition. They haven't discouraged the purchase or use of them at all. And this was when SJ was still in charge.
If Apple ever figures out a way to have multiple pressure levels on a capacitive screen without having to add an additional resistive layer, as a couple of manufacturers have done, then we will see that. There was a proposal by one stylus company, but it's a workaround at best.
If we did get pressure levels, then Wacom would be in trouble.
I do it every night. I know most Americans need to toughen up.
I do too. But I admit that at times, the weight can be annoying. I've made up some mock-ups in my shop, at the size and thickness of the current iPad, but with varying weights.
What I found is that at about one pound, the weight problem pretty much disappears. Of course, for bigger or smaller people, that weight will be different. But I asked several people to try the different weight mock-ups, and they pretty much all agreed on the one pound model.
I would bet that within the next two years, Apple would find it impossible to get the 10" model to one pound. I would be very surprised if they didn't do exactly what I did, but with an actual iPad case, padded with weight inside. This is a very common way of trying out differing sizes and weights.
There are times, such as when I'm riding the subway, standing in a crowded car, that I would like a smaller, and lighter model for reading. I really don't want to get a Kindle, because it's way too limited, and I buy books from Apple, Barnes & Noble as well as Amazon on a regular basis, as well as read from the British Library (a great app), as well as others. In addition, many of my books use color, photo's and graphics, none of which look at all pleasant on a Kindle. Only the iPad has this kind of reading usefulness.
So a 7.85" iPad that weighed no more than a pound would be really great. If it cost $299, I would run out to get it.
Know what? Not only is that perfectly right, you've given me the answer that will solve everyone's problems.
No one needs to be using two remotes when they have an Apple TV (the box). Have all TV manufacturers build Bluetooth 4.0 into TVs. Then let anything with Bluetooth act as a remote for any TV.
Then you can just use your iDevice as the remote for the Apple TV and simultaneously control the menus and whatever on your television.
It's likely that this day will come. Since BT4 uses almost no power, it doesn't tax the device's battery as older versions do. This would also give them the excuse to not supply their own remote, and save them some money.
As it is, we're seeing more and more companies make their receivers compatable with Apple's AirPlay. The home network standards never did take off in usage, even though so many components have come with it over the past several years. AirPlay is so much more of interest to people.
OS course, any device with built-in WiFi can already use an iOS device as a remote. There must be 100 apps out there, from simple free ones to those that cost $99.
Here's the problem with oversimplification, Apple runs a business that needs to be taken seriously in the financial community and they have to consistently perform at or above market expectations. With the iPad they currently have an opportunity that is contributing significantly to revenues and will do so for the foreseeable future.
Apple, at its current scale, can't afford to create product lines that sell in the "few hundred thousand" units. Apple TV, which they have always called a "hobby" has sold some where in the neighborhood of 4 million units since its introduction, or barely a blip on Apple's financial radar.
The Kindle Fire is a feature-crippled device that is effectively sold at cost. Apple is not about to market a similarly crippled device so they can sell it a minimal profit. It's not a good business decision. That's not to say they won't be in a position to do so at some point in the future, it's just not viable now. You won't be seeing a $299 or under Apple tablet anytime soon. If they did introduce one it could possibly be in the $399 to $449 range. That would certainly test whether the smaller format has a market.
Ok then, a few million units. I got the number of sales wrong, you don't need to be pedantic.
My point is that Apple could offer two or maybe three iPad models and completely crush the competitors who are selling smaller (or bigger) tablets/readers. The larger tablet is unlikely, but a nano iPad would expand the iPad's market, regardless of what the financial analysts believe.
Um-m-m-m, no. Production costs for iPads are not determined by the gram. Yes, the aluminum and glass in an iPad cost by the gram, but these costs are minor compared to everything else associated with the device. A different size iPad requires new production tools, new packaging, new transportation strategies. Most of the software can be used as is, but there are still costs associated with the different size. The production costs of a new smaller iPad are possibly greater than for the larger model, but Apple sells it for less? This does not sound like a smooth move to me.
There's absolutely no way that the production cost of the smaller model would be greater than the current model. You're dreaming.
The way it plays out is this:
Case - somewhat less (less material and less machining time).
CPU - possibly the same or maybe slightly less if they go with 2 GPU cores rather than 4
Battery - somewhat less
Screen - considerably less than the 10" - both for size and technology reasons. I would assume that the resolution would be the same as the original iPad or iPhone 4S rather than the retina display
Screen lighting - considerably less, particularly if they go with the older resolution
Circuit board - about the same
Assembly cost - about the same
Tooling - about the same (they would need new tooling, but it would be amortized over millions of units)
Plant overhead - very slightly less (would actually depend on how they allocate overhead)
Flash storage - considerably less. If they go with 8 GB, the cost would be half of the base model new iPad
Add it all up and I think $299 is probably doable. $249 would involve a significant reduction in margins. Apple may be willing to do that, but I doubt it. It would also be the end of the iPad Touch.
There's absolutely no way that the production cost of the smaller model would be greater than the current model. You're dreaming.
The way it plays out is this:
Case - somewhat less (less material and less machining time).
CPU - possibly the same or maybe slightly less if they go with 2 GPU cores rather than 4
Battery - somewhat less
Screen - considerably less than the 10" - both for size and technology reasons. I would assume that the resolution would be the same as the original iPad or iPhone 4S rather than the retina display
Screen lighting - considerably less, particularly if they go with the older resolution
Circuit board - about the same
Assembly cost - about the same
Tooling - about the same (they would need new tooling, but it would be amortized over millions of units)
Plant overhead - very slightly less (would actually depend on how they allocate overhead)
Flash storage - considerably less. If they go with 8 GB, the cost would be half of the base model new iPad
Add it all up and I think $299 is probably doable. $249 would involve a significant reduction in margins. Apple may be willing to do that, but I doubt it. It would also be the end of the iPad Touch.
There's a lot of misunderstanding about flash pricing out there. There are several types of flash memory. Without getting technical I'd like to give a short reason why Apple can't use flash made for a USB stick.
Not this again. There are two general types of Flash: SLC and MLC...with SLC being more reliable and MLC less (ignoring NOR and NAND for the moment). The difference between the two is far less today than before...or perhaps more accurately MLC has become good enough using a host of fancy tricks.
Apple uses MLC flash in the iOS devices. For example the iPhone 4S and the new iPad are sporting 24nm Toshiba THGVX1G7D2GLA08 16 GB MLC NAND Flash. iSuppli thinks it costs $19.20 while the 32GB around $38.40 and the 64GB $76.80.
Some USB sticks actually used SLC flash for performance. The older Corsair GTs had SLC but MLC is fast enough and reliable enough for new GTs to have MLC NAND flash to some grousing among those that still expect the more expensive SLC NAND in the GTs.
So the Flash type doesn't tell you that much about the grade of the flash these days...its pretty much all MLC except for a few enterprise drives. High end MLC flash is pretty good. Or more accurately the high end MLC flash controllers are very good, increasing the raw 3-5K P/E (write) cycles to an effective 30-50K P/E cycle. One reason that Apple bought Anobit was to keep this bit of technology to itself. There's probably some Anobit magic on the A5 SOC. Apple can afford to use "value" flash (24nm high density, high speed, low reliability flash) and end up with moderately high reliability as well.
SO the most important difference between "high end" flash seen in the iPhone and "low end" flash seen in low grade USB sticks is the iPhone has a high end controller and the USB stick has some craptastic eMMC controller. High end USB sticks are often pretty good. Certainly high end SDHC cards are just as good or better. For example the Transcend 32GB Class 10 SDHC is using SLC Flash and costs all of $32 retail on Newegg.
So there's no misunderstanding. Apple CAN afford to offer more flash storage but that's probably a good chunk of the margin right there. That's not likely to change but has little to do with what flash is costing Apple. That's also why we're very unlikely to ever see a SD card slot on the iPad.
Here's the problem with oversimplification, Apple runs a business that needs to be taken seriously in the financial community and they have to consistently perform at or above market expectations. With the iPad they currently have an opportunity that is contributing significantly to revenues and will do so for the foreseeable future.
Apple, at its current scale, can't afford to create product lines that sell in the "few hundred thousand" units. Apple TV, which they have always called a "hobby" has sold some where in the neighborhood of 4 million units since its introduction, or barely a blip on Apple's financial radar.
The Kindle Fire is a feature-crippled device that is effectively sold at cost. Apple is not about to market a similarly crippled device so they can sell it a minimal profit. It's not a good business decision. That's not to say they won't be in a position to do so at some point in the future, it's just not viable now. You won't be seeing a $299 or under Apple tablet anytime soon. If they did introduce one it could possibly be in the $399 to $449 range. That would certainly test whether the smaller format has a market.
The iPod Touch is a product that needs a serious refresh and would sell millions. A 7" iPod touch using the iPhone UI vs the iPad UI is viable if IMHO a little big.
Apple's biggest problem right now in the iOS lineup is their $199 product isn't very competitive vs the Kindle Fire given that Amazon is very aggressive in their app strategy and Fire pricing.
A 5-7" iPod touch in the $199 price lineup would go along way in addressing that without much if any impact on normal iPad sales while revitalizing the iPod Touch line. 640x960 on a 7" is a bit meh so I'm thinking 5" might be better and more pocketable.
A 7" device would be maybe $65-$75 less to manufacture. Other costs, shipping, marketing, warranty support stay more or less the same. If Amazon is spending $180-$200 for their device, there's no way a smaller-format iPad could be manufactured at that price. $250-$275 is more likely, which ends up at a retail price of $399 (maybe $379). Under $349 is fantasy pricing.
A 7" device would be maybe $65-$75 less to manufacture. Other costs, shipping, marketing, warranty support stay more or less the same. If Amazon is spending $180-$200 for their device, there's no way a smaller-format iPad could be manufactured at that price. $250-$275 is more likely, which ends up at a retail price of $399 (maybe $379). Under $349 is fantasy pricing.
An A4 based 7" iPad would cost little more than the iPod Touch (the difference between the 3.5" and 7" IPS panels) costs to make and it sells for $199. The A4 is more than capable of driving a 1024x768 screen since that's the same chip as in the original iPad.
A single Core A5 based touch seems like a logical upgrade and can still meet the existing price point. Especially given that that the aTV is only $99. My suspicion is that when the iPod touch gets its update that's what the CPU will be to differentiate between the touch and the iphone.
Not this again. There are two general types of Flash: SLC and MLC...with SLC being more reliable and MLC less (ignoring NOR and NAND for the moment). The difference between the two is far less today than before...or perhaps more accurately MLC has become good enough using a host of fancy tricks.
Apple uses MLC flash in the iOS devices. For example the iPhone 4S and the new iPad are sporting 24nm Toshiba THGVX1G7D2GLA08 16 GB MLC NAND Flash. iSuppli thinks it costs $19.20 while the 32GB around $38.40 and the 64GB $76.80.
Some USB sticks actually used SLC flash for performance. The older Corsair GTs had SLC but MLC is fast enough and reliable enough for new GTs to have MLC NAND flash to some grousing among those that still expect the more expensive SLC NAND in the GTs.
So the Flash type doesn't tell you that much about the grade of the flash these days...its pretty much all MLC except for a few enterprise drives. High end MLC flash is pretty good. Or more accurately the high end MLC flash controllers are very good, increasing the raw 3-5K P/E (write) cycles to an effective 30-50K P/E cycle. One reason that Apple bought Anobit was to keep this bit of technology to itself. There's probably some Anobit magic on the A5 SOC. Apple can afford to use "value" flash (24nm high density, high speed, low reliability flash) and end up with moderately high reliability as well.
SO the most important difference between "high end" flash seen in the iPhone and "low end" flash seen in low grade USB sticks is the iPhone has a high end controller and the USB stick has some craptastic eMMC controller. High end USB sticks are often pretty good. Certainly high end SDHC cards are just as good or better. For example the Transcend 32GB Class 10 SDHC is using SLC Flash and costs all of $32 retail on Newegg.
So there's no misunderstanding. Apple CAN afford to offer more flash storage but that's probably a good chunk of the margin right there. That's not likely to change but has little to do with what flash is costing Apple. That's also why we're very unlikely to ever see a SD card slot on the iPad.
Nope! There are three basic types of flash NAND. SLC, MLC and TLC. SLC is the most reliable. MLC is next. TLC is the least reliable. TLC is also the cheapest, and is often used in the cheapest sticks, and sometimes in the cheapest SD and Compact Flash cards.
It's true that TLC is a relation to MLC, which is just two bits, whereas TLC is three, but is also moving to four at some point. But they have to be made differently enough that they can be considered a different type, as SLC and MLC are. It's the newest type as well.
If what you said about the difference between SLC and MLC drives being different mainly because of the controllers were true (it isn't) then I wouldn't have posted what I did. But enterprise quality drives use SLc almost exclusively, which is why they cost so darned much. Even then, they have a greater percentage of overage in the amount of flash they use for greater reliability over time as the flash begins to fail. There are also semi-enterprise level drives that cost more than consumer models, but less than the real enterprise models that do use a higher rated MLC. But they can have as much as 28% overage in flash to make up for the lower reliability, despite the sophisticated controllers used today.
None of this is relevant to Apple's iOS devices, as they all use MLC. But a normal markup on part prices for manufacturers is between 100 and 300%. Apple isn't asking too much for it.
You should go to Newegg and look at prices for HDD's. You'll find that those branded with HP, IBM, Lenovo, etc, cost several times as much as those from Seagate, WB, etc. this is normal.
If Apple pays $50 for flash, I would expect them to charge between $100-150 for it in the device pricing. The Motorola tablet cost $200 more for an extra 32 GB when it first came out, as did the 3G/GPS add-on. And the basic tablet itself cost $599.
Nope! There are three basic types of flash NAND. SLC, MLC and TLC. SLC is the most reliable. MLC is next. TLC is the least reliable. TLC is also the cheapest, and is often used in the cheapest sticks, and sometimes in the cheapest SD and Compact Flash cards. It's true that TLC is a relation to MLC, which is just two bits, whereas TLC is three, but is also moving to four at some point. But they have to be made differently enough that they can be considered a different type, as SLC and MLC are. It's the newest type as well.
My point was simple: SLC, MLC and TLC flash are all used in consumer flash products and the price of 32GB SLC flash isn't all that high.
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If what you said about the difference between SLC and MLC drives being different mainly because of the controllers were true (it isn't) then I wouldn't have posted what I did.
I didn't say that. I said the difference between high grade consumer MLC in SSDs and low grade consumer MLC in USB keys are the controllers. Yes, I glossed over TLCs as part of MLCs but the trend remains the same. The higher density the flash the lower the P/E cycles ether from process node (20nm) or from more bits (3 bpc). The mitigation strategy is the same: couple cheaper higher density flash with smarter controllers for the desired duty cycle.
TLCs will end up with the same effective P/E cycles eventually by using more spare cells and better wear algorithms. When this happens they will appear in SSDs just like 2 bpc MLC flash did.
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None of this is relevant to Apple's iOS devices, as they all use MLC. But a normal markup on part prices for manufacturers is between 100 and 300%. Apple isn't asking too much for it.
You should go to Newegg and look at prices for HDD's. You'll find that those branded with HP, IBM, Lenovo, etc, cost several times as much as those from Seagate, WB, etc. this is normal.
If Apple pays $50 for flash, I would expect them to charge between $100-150 for it in the device pricing. The Motorola tablet cost $200 more for an extra 32 GB when it first came out, as did the 3G/GPS add-on. And the basic tablet itself cost $599.
Apple doesn't pay $50 for 32GB MLC flash. I'd be surprised if they pay the $30 estimated by iSuppli.
Apple is asking a lot for their flash upgrades but the market is willing to pay it.
Comments
He might have to hammer himself since all these sound like planned leaks. Nice black on white btw.
Quote:
Originally Posted by Junkyard Dawg
And Apple doesn't need to sell YOU on a 7" iPad, they only need to sell a few hundred thousand other people on it to make it worth their while to produce.I'd go so far as to argue for two more iPad sizes for a total of three models:
7" iPad Go
9.7" iPad
~14" iPad Pro
The 7" iPad would be great for those who want ultimate portability, and the 15" for fat-arsed couch potatoes who use it for surfing and pr0n. Maybe even slap an Ivy Bridge CPU (or comparably powerful) in the Pro and offer it with a wireless sketch tablet and it may become a Photoshop/Illustrator monster. Market the 10" iPad to average consumers and gimp the 7" enough so it doesn't eat into the 10" version's sales. For many people, an iPad is enough to fulfill all their computing needs.
Here's the problem with oversimplification, Apple runs a business that needs to be taken seriously in the financial community and they have to consistently perform at or above market expectations. With the iPad they currently have an opportunity that is contributing significantly to revenues and will do so for the foreseeable future.
Apple, at its current scale, can't afford to create product lines that sell in the "few hundred thousand" units. Apple TV, which they have always called a "hobby" has sold some where in the neighborhood of 4 million units since its introduction, or barely a blip on Apple's financial radar.
The Kindle Fire is a feature-crippled device that is effectively sold at cost. Apple is not about to market a similarly crippled device so they can sell it a minimal profit. It's not a good business decision. That's not to say they won't be in a position to do so at some point in the future, it's just not viable now. You won't be seeing a $299 or under Apple tablet anytime soon. If they did introduce one it could possibly be in the $399 to $449 range. That would certainly test whether the smaller format has a market.
Why is that? The current iPad 2 only costs that much to make. So Apple doesn't make more then 40 percent margin on a device, is that so bad. Apple could take off 20 percent off across their product board and they would still make more money then every computer company out there.
If Apple reduced its profits by 50% the stock price would collapse. Whether you agree with it or not, Apple is a business that is accountable to the shareholders. Apple can't just decide to be charitable.
Quote:
Originally Posted by Venerable
Here's the problem with oversimplification, Apple runs a business that needs to be taken seriously in the financial community and they have to consistently perform at or above market expectations. With the iPad they currently have an opportunity that is contributing significantly to revenues and will do so for the foreseeable future.
Apple, at its current scale, can't afford to create product lines that sell in the "few hundred thousand" units. Apple TV, which they have always called a "hobby" has sold some where in the neighborhood of 4 million units since its introduction, or barely a blip on Apple's financial radar.
The Kindle Fire is a feature-crippled device that is effectively sold at cost. Apple is not about to market a similarly crippled device so they can sell it a minimal profit. It's not a good business decision. That's not to say they won't be in a position to do so at some point in the future, it's just not viable now. You won't be seeing a $299 or under Apple tablet anytime soon. If they did introduce one it could possibly be in the $399 to $449 range. That would certainly test whether the smaller format has a market.
Apple has the ability to build a proper Apple 7.85" tablet for $200 cost, sell it for $279 (~25-30% margins). Not only that but they would sell 16GB at $329 and 32GB at $399 or $429 (super margins) and across that range would sell millions. Average margin would be set by the mid-range model since that seems to be the best seller for most Apple lines. Note that although Apple's average OM is 41% that is massively because the iPhone is insanely profitable. iPads are everaging in the 30-40% range, Macs in the 20-30% range overall. You don't need to be iPhone profitable to succeed in Apple.
People would buy them like the Fire at Christmas but love them, keep them and tell everyone they know. The larger, more resource intensive iPad 2 BOM is estimated at $237. It would not be crippled, it would be a trade-off situation - using the 28nm A5, offer 2/3 the screen area with similar but probably lower battery life. The smaller form factor has an obvious market that may be the same or larger than the 10" market and Apple would be nuts to miss out on it. Apple knows far better than you how to set product specs at overlapping price points that sell to the appropriate customers and mitigate excess cannibalization. Why on earth (if Apple can build it) should they not take an entire major market segment away from the competitors. iPad is like iPods - Apple can and should control the entire market. There is no impediment like the carriers to stop them. There are Apple margins to be made at every major price point. My full argument is laid out at entry #74.
Don't be paralyzed by the Macs example. It is the anomaly, where cherry picking the high-end of a mature commoditized business is the right move. This is neither mature nor commoditized. Hell, it is not even well defined. 70% of the current market is irrelevant if the current market is only 20% of the available market. iPhone has shown that if you leave key market segments alone, others will take them and you may never get access to them again. Samsung is proving that it can be highly (if not Apple=like) profitable in mid/lower end smartphones and that base will provide them a very strong platform to take on Apple at the high-end once smartphone market saturation occurs. It is always easier to upgrade your own customers that steal someone else's, something they have proven and Nokia has singularly failed to grasp.
This is like iPods in 2004. Apple saw the light in releasing the mini and never looked back. This is that moment for tablets. Before others can really respond.
Too bad you've overpaid for an oversized remote, as that's about all the device is useful for.
Quote:
Originally Posted by melgross
Too bad you've overpaid for an oversized remote, as that's about all the device is useful for.
Know what? Not only is that perfectly right, you've given me the answer that will solve everyone's problems.
No one needs to be using two remotes when they have an Apple TV (the box). Have all TV manufacturers build Bluetooth 4.0 into TVs. Then let anything with Bluetooth act as a remote for any TV.
Then you can just use your iDevice as the remote for the Apple TV and simultaneously control the menus and whatever on your television.
Ah, the old question of flash storage.
There's a lot of misunderstanding about flash pricing out there. There are several types of flash memory. Without getting technical I'd like to give a short reason why Apple can't use flash made for a USB stick.
Reliability is the biggest issue with flash. We go from very reliable memory used for expensive enterprise drives at about 50,000 to 100,000 writes lifetime per cell, all the way down to 250 to 500 writes per cell for the typical flash USB stick.
In between is the 3,000 to10,000 write per cell SSD drives sold for consumer use, and for the better phones and for tablet use.
That memory costs a lot more than the cheap, but short lifetime memory used in a USB stick. USb sticks aren't expected to be used a lot. They are for taking files off, and transporting them somewhere else. If they're used a few hundred times, then thrown away, nobody thinks much of it.
But for a smartphone or tablet, that won't do. They need to have the memory usable for years, at constant use levels. With what's called "leveling" that can be done with the mid level flash these manufacturers use. But it can't be done with the cheap flash used in cheap USB sticks.
This is why it's not recommended to use a large USB stick as a startup drive in regular use. It will degrade too quickly.
It's possible that some secondary tablet manufacturers are using this cheaper memory. I can't say. But it's a very bad idea.
This really a terrible misconception! It simply isn't true about SJ's feelings about a stylus. He didn't hate the idea of a stylus being used with an iPhone or an iPad. What he was against was the requirement that a stylus be needed.
I don't remember now, but I think it was when I bought my first iPad, the iPad1 with 3G, in May of 2010, that I was asked by the Apple sales person if I wanted a stylus with my new iPad. I said yes, as I was planning to get one anyway. If SJ was so against stylus's, he would never have allowed them to be on sale in Apple's stores, or on their web site.
Apple is smart enough to know that there will be some people for whom a stylus is a very important addition. They haven't discouraged the purchase or use of them at all. And this was when SJ was still in charge.
If Apple ever figures out a way to have multiple pressure levels on a capacitive screen without having to add an additional resistive layer, as a couple of manufacturers have done, then we will see that. There was a proposal by one stylus company, but it's a workaround at best.
If we did get pressure levels, then Wacom would be in trouble.
I do too. But I admit that at times, the weight can be annoying. I've made up some mock-ups in my shop, at the size and thickness of the current iPad, but with varying weights.
What I found is that at about one pound, the weight problem pretty much disappears. Of course, for bigger or smaller people, that weight will be different. But I asked several people to try the different weight mock-ups, and they pretty much all agreed on the one pound model.
I would bet that within the next two years, Apple would find it impossible to get the 10" model to one pound. I would be very surprised if they didn't do exactly what I did, but with an actual iPad case, padded with weight inside. This is a very common way of trying out differing sizes and weights.
There are times, such as when I'm riding the subway, standing in a crowded car, that I would like a smaller, and lighter model for reading. I really don't want to get a Kindle, because it's way too limited, and I buy books from Apple, Barnes & Noble as well as Amazon on a regular basis, as well as read from the British Library (a great app), as well as others. In addition, many of my books use color, photo's and graphics, none of which look at all pleasant on a Kindle. Only the iPad has this kind of reading usefulness.
So a 7.85" iPad that weighed no more than a pound would be really great. If it cost $299, I would run out to get it.
It's likely that this day will come. Since BT4 uses almost no power, it doesn't tax the device's battery as older versions do. This would also give them the excuse to not supply their own remote, and save them some money.
As it is, we're seeing more and more companies make their receivers compatable with Apple's AirPlay. The home network standards never did take off in usage, even though so many components have come with it over the past several years. AirPlay is so much more of interest to people.
OS course, any device with built-in WiFi can already use an iOS device as a remote. There must be 100 apps out there, from simple free ones to those that cost $99.
Quote:
Originally Posted by Venerable
Here's the problem with oversimplification, Apple runs a business that needs to be taken seriously in the financial community and they have to consistently perform at or above market expectations. With the iPad they currently have an opportunity that is contributing significantly to revenues and will do so for the foreseeable future.
Apple, at its current scale, can't afford to create product lines that sell in the "few hundred thousand" units. Apple TV, which they have always called a "hobby" has sold some where in the neighborhood of 4 million units since its introduction, or barely a blip on Apple's financial radar.
The Kindle Fire is a feature-crippled device that is effectively sold at cost. Apple is not about to market a similarly crippled device so they can sell it a minimal profit. It's not a good business decision. That's not to say they won't be in a position to do so at some point in the future, it's just not viable now. You won't be seeing a $299 or under Apple tablet anytime soon. If they did introduce one it could possibly be in the $399 to $449 range. That would certainly test whether the smaller format has a market.
Ok then, a few million units. I got the number of sales wrong, you don't need to be pedantic.
My point is that Apple could offer two or maybe three iPad models and completely crush the competitors who are selling smaller (or bigger) tablets/readers. The larger tablet is unlikely, but a nano iPad would expand the iPad's market, regardless of what the financial analysts believe.
There's absolutely no way that the production cost of the smaller model would be greater than the current model. You're dreaming.
The way it plays out is this:
Case - somewhat less (less material and less machining time).
CPU - possibly the same or maybe slightly less if they go with 2 GPU cores rather than 4
Battery - somewhat less
Screen - considerably less than the 10" - both for size and technology reasons. I would assume that the resolution would be the same as the original iPad or iPhone 4S rather than the retina display
Screen lighting - considerably less, particularly if they go with the older resolution
Circuit board - about the same
Assembly cost - about the same
Tooling - about the same (they would need new tooling, but it would be amortized over millions of units)
Plant overhead - very slightly less (would actually depend on how they allocate overhead)
Flash storage - considerably less. If they go with 8 GB, the cost would be half of the base model new iPad
Add it all up and I think $299 is probably doable. $249 would involve a significant reduction in margins. Apple may be willing to do that, but I doubt it. It would also be the end of the iPad Touch.
Hmmm. I agree with you on this.
Quote:
Originally Posted by melgross
Ah, the old question of flash storage.
There's a lot of misunderstanding about flash pricing out there. There are several types of flash memory. Without getting technical I'd like to give a short reason why Apple can't use flash made for a USB stick.
Not this again. There are two general types of Flash: SLC and MLC...with SLC being more reliable and MLC less (ignoring NOR and NAND for the moment). The difference between the two is far less today than before...or perhaps more accurately MLC has become good enough using a host of fancy tricks.
Apple uses MLC flash in the iOS devices. For example the iPhone 4S and the new iPad are sporting 24nm Toshiba THGVX1G7D2GLA08 16 GB MLC NAND Flash. iSuppli thinks it costs $19.20 while the 32GB around $38.40 and the 64GB $76.80.
Some USB sticks actually used SLC flash for performance. The older Corsair GTs had SLC but MLC is fast enough and reliable enough for new GTs to have MLC NAND flash to some grousing among those that still expect the more expensive SLC NAND in the GTs.
So the Flash type doesn't tell you that much about the grade of the flash these days...its pretty much all MLC except for a few enterprise drives. High end MLC flash is pretty good. Or more accurately the high end MLC flash controllers are very good, increasing the raw 3-5K P/E (write) cycles to an effective 30-50K P/E cycle. One reason that Apple bought Anobit was to keep this bit of technology to itself. There's probably some Anobit magic on the A5 SOC. Apple can afford to use "value" flash (24nm high density, high speed, low reliability flash) and end up with moderately high reliability as well.
SO the most important difference between "high end" flash seen in the iPhone and "low end" flash seen in low grade USB sticks is the iPhone has a high end controller and the USB stick has some craptastic eMMC controller. High end USB sticks are often pretty good. Certainly high end SDHC cards are just as good or better. For example the Transcend 32GB Class 10 SDHC is using SLC Flash and costs all of $32 retail on Newegg.
So there's no misunderstanding. Apple CAN afford to offer more flash storage but that's probably a good chunk of the margin right there. That's not likely to change but has little to do with what flash is costing Apple. That's also why we're very unlikely to ever see a SD card slot on the iPad.
Quote:
Originally Posted by Venerable
Here's the problem with oversimplification, Apple runs a business that needs to be taken seriously in the financial community and they have to consistently perform at or above market expectations. With the iPad they currently have an opportunity that is contributing significantly to revenues and will do so for the foreseeable future.
Apple, at its current scale, can't afford to create product lines that sell in the "few hundred thousand" units. Apple TV, which they have always called a "hobby" has sold some where in the neighborhood of 4 million units since its introduction, or barely a blip on Apple's financial radar.
The Kindle Fire is a feature-crippled device that is effectively sold at cost. Apple is not about to market a similarly crippled device so they can sell it a minimal profit. It's not a good business decision. That's not to say they won't be in a position to do so at some point in the future, it's just not viable now. You won't be seeing a $299 or under Apple tablet anytime soon. If they did introduce one it could possibly be in the $399 to $449 range. That would certainly test whether the smaller format has a market.
The iPod Touch is a product that needs a serious refresh and would sell millions. A 7" iPod touch using the iPhone UI vs the iPad UI is viable if IMHO a little big.
Apple's biggest problem right now in the iOS lineup is their $199 product isn't very competitive vs the Kindle Fire given that Amazon is very aggressive in their app strategy and Fire pricing.
A 5-7" iPod touch in the $199 price lineup would go along way in addressing that without much if any impact on normal iPad sales while revitalizing the iPod Touch line. 640x960 on a 7" is a bit meh so I'm thinking 5" might be better and more pocketable.
A 7" device would be maybe $65-$75 less to manufacture. Other costs, shipping, marketing, warranty support stay more or less the same. If Amazon is spending $180-$200 for their device, there's no way a smaller-format iPad could be manufactured at that price. $250-$275 is more likely, which ends up at a retail price of $399 (maybe $379). Under $349 is fantasy pricing.
Quote:
Originally Posted by Venerable
A 7" device would be maybe $65-$75 less to manufacture. Other costs, shipping, marketing, warranty support stay more or less the same. If Amazon is spending $180-$200 for their device, there's no way a smaller-format iPad could be manufactured at that price. $250-$275 is more likely, which ends up at a retail price of $399 (maybe $379). Under $349 is fantasy pricing.
An A4 based 7" iPad would cost little more than the iPod Touch (the difference between the 3.5" and 7" IPS panels) costs to make and it sells for $199. The A4 is more than capable of driving a 1024x768 screen since that's the same chip as in the original iPad.
A single Core A5 based touch seems like a logical upgrade and can still meet the existing price point. Especially given that that the aTV is only $99. My suspicion is that when the iPod touch gets its update that's what the CPU will be to differentiate between the touch and the iphone.
Nope! There are three basic types of flash NAND. SLC, MLC and TLC. SLC is the most reliable. MLC is next. TLC is the least reliable. TLC is also the cheapest, and is often used in the cheapest sticks, and sometimes in the cheapest SD and Compact Flash cards.
It's true that TLC is a relation to MLC, which is just two bits, whereas TLC is three, but is also moving to four at some point. But they have to be made differently enough that they can be considered a different type, as SLC and MLC are. It's the newest type as well.
If what you said about the difference between SLC and MLC drives being different mainly because of the controllers were true (it isn't) then I wouldn't have posted what I did. But enterprise quality drives use SLc almost exclusively, which is why they cost so darned much. Even then, they have a greater percentage of overage in the amount of flash they use for greater reliability over time as the flash begins to fail. There are also semi-enterprise level drives that cost more than consumer models, but less than the real enterprise models that do use a higher rated MLC. But they can have as much as 28% overage in flash to make up for the lower reliability, despite the sophisticated controllers used today.
None of this is relevant to Apple's iOS devices, as they all use MLC. But a normal markup on part prices for manufacturers is between 100 and 300%. Apple isn't asking too much for it.
You should go to Newegg and look at prices for HDD's. You'll find that those branded with HP, IBM, Lenovo, etc, cost several times as much as those from Seagate, WB, etc. this is normal.
If Apple pays $50 for flash, I would expect them to charge between $100-150 for it in the device pricing. The Motorola tablet cost $200 more for an extra 32 GB when it first came out, as did the 3G/GPS add-on. And the basic tablet itself cost $599.
Quote:
Originally Posted by melgross
Nope! There are three basic types of flash NAND. SLC, MLC and TLC. SLC is the most reliable. MLC is next. TLC is the least reliable. TLC is also the cheapest, and is often used in the cheapest sticks, and sometimes in the cheapest SD and Compact Flash cards. It's true that TLC is a relation to MLC, which is just two bits, whereas TLC is three, but is also moving to four at some point. But they have to be made differently enough that they can be considered a different type, as SLC and MLC are. It's the newest type as well.
My point was simple: SLC, MLC and TLC flash are all used in consumer flash products and the price of 32GB SLC flash isn't all that high.
Quote:
If what you said about the difference between SLC and MLC drives being different mainly because of the controllers were true (it isn't) then I wouldn't have posted what I did.
I didn't say that. I said the difference between high grade consumer MLC in SSDs and low grade consumer MLC in USB keys are the controllers. Yes, I glossed over TLCs as part of MLCs but the trend remains the same. The higher density the flash the lower the P/E cycles ether from process node (20nm) or from more bits (3 bpc). The mitigation strategy is the same: couple cheaper higher density flash with smarter controllers for the desired duty cycle.
TLCs will end up with the same effective P/E cycles eventually by using more spare cells and better wear algorithms. When this happens they will appear in SSDs just like 2 bpc MLC flash did.
Quote:
None of this is relevant to Apple's iOS devices, as they all use MLC. But a normal markup on part prices for manufacturers is between 100 and 300%. Apple isn't asking too much for it.
You should go to Newegg and look at prices for HDD's. You'll find that those branded with HP, IBM, Lenovo, etc, cost several times as much as those from Seagate, WB, etc. this is normal.
If Apple pays $50 for flash, I would expect them to charge between $100-150 for it in the device pricing. The Motorola tablet cost $200 more for an extra 32 GB when it first came out, as did the 3G/GPS add-on. And the basic tablet itself cost $599.
Apple doesn't pay $50 for 32GB MLC flash. I'd be surprised if they pay the $30 estimated by iSuppli.
Apple is asking a lot for their flash upgrades but the market is willing to pay it.