What will Apple's Big Tablet cost?
- — 27 July, 2009 10:49
So what do we know about the tablet? Reports say it's an iPod-like device with a 10-inch screen, a handheld slate that's large enough for HD movies, video gaming, and Web browsing without all the window-resizing and screen-tapping calisthenics that smartphone users endure. Apple Insider says the tablet will feature 3G broadband, which seems logical. And since we're speculating here, I'd like to request Wi-fi, Bluetooth, and GPS as well.
Name Your Price
Specs aside, what should Apple charge for the Big Tablet? Some reports say $800 is likely, but that seems high for a consumer electronics device. My prediction: $499. Here's why:
According to a 2007 study by the Consumer Electronics Association (CEA), the average American household spends about $1200 annually on electronics products. Would the typical household blow two-thirds of its tech budget on one handheld device? Probably not.
And that CEA study was two years ago -- before the current recession and consumers' belt-tightening ways. To me, $500 seems like the sweet spot for a premium consumer gadget.
And then there's Apple's product lineup. Currently, there's a big gulf between the 32GB iPod touch ($399) and the $999 MacBook. Let's assume Apple drops the iPod touch price, as it did recently with some of its MacBooks. The Big Tablet would fill the void nicely at $499.
Of course, for Apple to achieve its desired profit margin, that $500 price tag may include a 3G service contract with a major wireless carrier. Given the enormous success of the iPhone, it wouldn't be surprising if AT&T, Sprint, or Verizon would be willing to subsidize the tablet's cost to sign up new subscribers. Netbooks with wireless-style plans are becoming increasing common, so the subsidized model for consumer hardware is already in place.
And, no, I didn't call the Big Tablet a netbook. Apple would hate that.