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Aggressive iPad Pricing Keeping Rivals at Bay–For Now

by on November 3rd, 2010

Larry Dignan over at ZDNET wrote an interesting article about why the iPad’s competitors just can’t keep up with Apple. Forget the fact that Apple already has a 95% tablet marketshare. One major factor is pricing, along with features in both hardware and software.

Here are prices of current iPad competitors:

How did Apple grab their 95% lead so quickly? Here is Dignan’s breakdown:

  • Apple built its own chips to take on an industry that clearly wasn’t ready for the iPad’s launch. It will take the Android ecosystem another rev on the product cycle just to approach what Apple has today.
  • The players taking on Apple all have some sort of restriction. Apple has its own components, software and design specs. Apple also doesn’t give a hoot where it gets its parts. Now contrast that with rivals. Samsung as a massive tech conglomerate has a few built in advantages, but it’s Korea’s champion. The company is not going to go to China for parts.
  • The software ecosystem isn’t ready. Microsoft is cramming Windows 7 into a tablet. HP has the webOS waiting in the wings. Android isn’t quite tablet ready yet. Apple had the ecosystem and operating system. Apple just had to add a 10-inch screen.

Add this all up and throw in Steve Jobs’ assertion that competitor 7″ tablets will be DOA, it just proves that Apple knew their aggressive pricing model would make it tough on competitors to keep up.

Competitors know that they won’t be able to beat Apple at their game. But they do know they can pour millions into marketing and sell a less than stellar product, for people who don’t want to shell out the Apple tax. However, when it comes to the tablet and the pricing mentioned above–the competition can’t play the price wars on equal footing and are making smaller screens to compensate.

Would you pay $499 for a 7″ tablet or for a 10″ iPad?

[ZDNET]

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Posted under: iPad News

  • http://promodsharma.com Promod Sharma

    There’s now a proven market for a 10″ tablet. So why are other companies targeting 7″? Cost considerations aren’t a great rationale from a buyer’s perspective. Also, Apple’s App Store is a huge competitive advantage.

    There’s little point paying the same price for a “clone”.

  • ward09

    Personally, I prefer 10″, but 7″ is alright with me too. It’s the iPad’s price and early lead that will keep Apple out front for a long time. $500 is just too much for the Galaxy Tab.