How Much Should Apple's Tablet Cost?
Apple is known for a lot of good things: innovation, slick products, rosy earnings. Unfortunately, affordable pricing isn't one of them. And so it's a good bet that Apple's rumored tablet with the 10-inch touchscreen won't be cheap when it finally comes to market.
How much would you be willing to pay for an Apple tablet? "The rumor has Apple coming out with an $800 tablet," says Manish Rathi, co-founder of Retrevo, a consumer electronics shopping site. Yet he's quick to add that Apple would be wise to get to $600 or less.
Sure, the question of price is completely unfair because an Apple tablet (if it's even a tablet and not a netbook) hasn't hit the market yet and probably won't this year. But that didn't stop Retrevo from asking some 750 potential buyers the same question.
Comparing unit shipment trends of the Mac and iPhone and then analyzing the responses of survey participants, Retrevo found that Apple needs to hit the $600 price point for a tablet to have a chance at achieving the sort of popularity of the iPhone.
Confused? Here's Retrevo's thinking:
Retrevo says the Apple faithful will open their wallets for an Apple tablet. Forty-one percent of Mac users said they'd pay more than $800 for an Apple tablet, while 27 percent said they'd pay anywhere from $600 to $800. Only 32 percent said they'd pay less than $600. This means two out of three Mac aficionados will pay $600 or more.
Contrast this with PC users in the survey. Only 20 percent would pay more than $800, and 16 percent would pay between $600 to $800. A whopping 64 percent said they'd pay less than $600.
The iPhone owes much of its success for its ability to sway non-Apple fans to become iPhone owners, and Retrevo figures an Apple tablet would need to do the same. Judging from its survey, Retrevo says Apple needs to hit the $600 price point to convince PC users to buy an Apple product, which will essentially be a mini-computer.
"If [the tablet] can get to something like the iPhone, then unit shipments go over the top," Rathi says, "which means you have to go beyond your Mac loyalists and get to the PC users—the people who are willing to switch."
But don't call it a netbook because that ship has sailed, according to Retrevo. Netbooks have already cornered much of the early adopter market. The Retrevo survey found that 37 percent of people who said that a Mac was their primary computer already own, or plan to buy, a netbook this year. A slightly smaller number, 35 percent, of consumers who use a Windows-based PC as their primary system said the same thing.
"How late is Apple to this game? Probably very late," Rathi says. "This supports the fact that Apple may just go ahead with a tablet or something that has a reader built in because the e-reader market is definitely heating up quite a bit. I don't think Apple would be late to the e-reader game."
Apple hitting Retrevo's suggested $600 tablet price point won't be easy. "You're looking at a touchscreen display and there's still work cut out in how you can get the capacitors and multi-touch working on a larger screen at those price points," Rathi explains. "Maybe Apple will subsidize the tablet the way they did with the iPhone."