With iPad Mini, Apple Switches From Offense To Defense

Apple is growing. And the iPad mini is a sign of growth’s costs.

On Tuesday, alongside a new Retina MacBook, faster Mac Mini, and super thin iMac, Apple announced the iPad Mini. It’s a 7.9-inch, .68lb version of Apple’s landmark tablet—the product that will go down in history for bucking conventions and making the tablet form factor every bit as popular as Star Trek imagined. And yet the iPad Mini is a harbinger of a different Apple—one that doesn’t just take big, risky swings to change the world but snags low-hanging fruit to appease board members, too.

The iPad Mini is no iPad—not strategically. In a world of diminutive smartphones and Kindles, the original iPad was stubbornly large. It wasn’t quite the size of a magazine, and it wasn’t quite the size of a book. It was big enough for movies, probably, but it wasn’t a widescreen. The only real justification to the iPad’s size and shape was that, somewhere in the heart of Cupertino, a team of designers overseen by Jobs and Ive, decided that a 9.7-inch, 4:3 screen was perfect for held media. It’s a point that Jobs was extremely outspoken about in a call to investors in 2010.

[W]e think the ten-inch screen size is the minimum size required to create great tablet apps . . . the current crop of seven-inch tablets are going to be DOA—dead on arrival. Their manufacturers will learn the painful lesson that their tablets are too small and increase the size next year, thereby abandoning both customers and developers who jumped on the seven-inch bandwagon with an orphaned product. Sounds like lots of fun ahead.

So does the iPad Mini make Apple a hypocrite? Nah. It just makes them wrong. The iPad Mini is not a product driven by usability—even though Phil Schiller points out that it can "be held in one hand"—but one driven by market pressure. With Kindles, Nooks, and every Android tablet under the sun, Apple faces an incredible amount of competition from a quickly commoditized tablet market. This competition sits in a sweet spot that’s roughly half the price of a $500 iPad, which surely convinces some bootstrapping households that "we could get two Kindles for the price of one iPad!"

So the iPad Mini is a $329 device. Its size—its inevitable fanboy arguments for usability or portability—are largely irrelevant. It’s a cheaper iPad, and so more people will buy it. That’s why it exists. Apple basically said so in 2010.

For Apple, this is a notable shift in strategy. Since the famous return of Jobs, Apple had been a premium alternative brand, selling a few forward-thinking products that sat at the top of the market in innovation, design, and build quality, kindly tossing down ropes for lost industry peers to climb up. Apple consumerized the smartphone with the iPhone. They solidified the tablet industry with the iPad (and personally sold 100 million of 'em to boot). Even the Macbook Air—the old laptop form factor—spawned a line of competitive PC ultrabooks subsidized by Intel. These days, it’s hard to find a laptop that isn’t under one inch thick.

Now, Apple is backtracking. The iPad Mini isn’t even an attempt at an iconic product. And it’s not a smaller-equates-premium 12-inch Powerbook (it doesn’t even have a Retina display). It’s a direct, ground-level battle for turf in a tablet market that veered a bit from Apple’s original path (Apple did a side-by-side on stage of the Mini next to the Nexus!). It’s the sort of strategy you see from the Samsungs and the Sonys of the world (or at least, you would, before everyone started emulating Apple’s simpler model), which release 20 SKUs for what’s essentially the same camcorder or Blu-ray player, hitting every $20 price point from $400 to $800 in order to milk dollars from every consumer possible.

Is this the end of Apple’s run? Of course not. The iPad Mini will sell wonderfully, just like the iPod Mini did. The difference here, of course, is that the iPod Mini was truly pocketable. It was also, quite simply, an idyllic form, rather than a laptop hard drive in a case. For the end user, it was actually a lot more than a slightly smaller, cheaper iPod.

It’s also a bit ironic that while Apple roughs it to appeal to budget-conscious consumers, their once-greatest rival, Microsoft, positions its Surface tablet as a premium product. The Surface starts at $500, but it’s really $600 with a keyboard. A future version, fitted with a full-blown laptop processor, will probably even reach $1,000. And it’s sold exclusively at Microsoft stores.

While Apple is diversifying their iPad line and going mainstream, Microsoft is honing their vision and lobbying for tablets as premium devices. To quote Jobs himself, "Sounds like lots of fun ahead."

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  • andybar

    “If you don’t cannibalize yourself, someone else will”
    — Steve Jobs 

  • Mick

    The only thing this device is going to do is cannibalise Apple's own ipad market.
    People who aren't Apple fanboys will gravitate toward the cheaper Nexus 7.

    No idea what the hell Apple were thinking with this “me-too” strategy.

  • Andy Bartlett

    Mark, couldn't agree less with your conclusion that "Its size . . .  usability or portability--are largely irrelevant." Here in NYC the full-size iPad is a liability in most mobile situations. It's awkwardly big & indiscrete on the subway and other close quarters situations and it can't be used with one hand. 
    When Jobs introduced the iPad he sat down on a couch installed on the stage to use it. That was, and is, the most relevant usage scenario for larger tablets. Honestly, the 9.7 iPad is mobile mostly in the same sense as a laptop.
    The iPad Mini will be wildly popular, not because of price or fanboys, but because it's an eminently more practical, usable size for constant and near-constant mobility. I had a Nexus 7. It's pretty good, but felt a little cramped. iOS is still offers a much-superior tablet experience, fast, but with smooth transitions. Mobile is becoming the default platform these days, and the under 8" size is just about perfect.

    Andy Bartlett

  • ●_●

    Sigh. Apple-fanboys abound. While I don't necessarily agree with the writer, I just find it truly pathetic how much some of the guys here practically worship Apple.

  • Graham Robertson

    This piece feels like it was written by a 10-year-old.  Oddly, that it's in a business magazine.  Please take a strategy course and get back to us.

  • guest

    "So does the iPad Mini make Apple a hypocrite? Nah. It just makes them wrong."
    Can't you read? smh

  • The Racket

    You're spot on. This Mark guy doesn't know what he's talking about the vast majority of the time. His articles are surface level at best – lacking the insight and opinion that comes with expertise. If you notice, most of the articles across design/exist/create are handled by just a couple people – it's a skeleton editorial staff, none of which seem to bring anything substantial to the table.

  • The Racket

    Disagree. Apple isn't in a position to follow just yet—they single handedly built and legitimized this segment from what was a bulky, borderline useless PC mess. The iPad as a product segment is the bar and everyone else is playing catch up. What you should do is zoom out and understand that only the Apple consumer, sales force, retail channel, and internal marketing and logistics approach the iPad mini as "new". Design and engineering are several years (7 or so) past any products we view as new. Releasing a smaller form-factor in a channel that you created is hardly defense. The difference is, everyone else had to release a 7" tablet because they couldn't compete at the high-end. Economics, not innovation led that shift. As such, the competition in trying to snag share from Apple, using smaller low-cost products, ended up defining (at their cost) a sub-category (at no cost to Apple) that Apple will now capitalize on within it's existing strategy–clearly providing a higher quality product with the capacity for higher margins and significantly better distribution and absorption. And Microsoft – well, they have a 50/50 chance. Either the Surface goes the way of the Zune because Windows 8 or RT or whatever it is seems pretty lousy – or they find similar success to the Xbox. At the end of the day, they *just* entered the fray and have a lot of work ahead of them...with the likelihood of catching up being rather slim. 

    And all the while, you'd be naive to think that Apple isn't exactly on top of what's next while everyone else is trying to figure out how to beat their old news.

  • Robertjan Kuijten

    What a terrible point of view from Fastco. Are you guys really that stupid?
    You mentioned the iPod mini (without capital m) there yourself. At that very same time there was Creative with there Zen line of products (need to refresh your memory now?). I only see the same thing happening again now with the iPad. No playing catchup, no mimicking to Sony or Samesung. Just diversifying the product line.
    The iPad line is very distinctive from their competitors in that they need to cash on hardware as well as software. As opposed to Google and Amazon. Microsoft is in the same situation as Apple, and it shows: their Surface RT-tablets start at the same price point as Apple's.

    Besides, I see very few people getting the point that Apple gives the customers an important choice at this moment: an iPad 2 at 10" without a decent camera, without Siri, bigger screen but less sharp, twice as heavy and less compact or a $ 70 cheaper iPad mini with the same camera as the iPod touch, with Siri, sharper screen (but the same information), more compact and half the weight of the 2. In fact, they might stop the paradigm of making a current version the budget version at the next new release. Instead they go the iPod way: separate devices for different needs.

    I think the intention might have been to obsolete the iPad 2 by giving consumers the current state-of-the-art compact and light tablet. Which is usable with mobile internet subscriptions, as opposed to some other 'high-end' (*cough*) tablets like Google's or Amazon's. Which don't allow the usage of mobile internet and are therefor not convenient to take with you on daily routines.

    So to conclude. The title of this article is totally bullshit.

  • AndiFG

    Great article!
    I think many people here seem offended by the author attacking apple, but I totally agree!

    Apple became defensive by making a premium version of an existing product (which others have invented) - the one-handed Tablet.
    Microsoft on the other hand is the aggressor, by introducing a completely new product - the hybrid tablet computer device.
    This might not be the Surface RT version, which might be more of a premium tablet, but definitely the Surface with windows 8.

    Of course it's arguable whether that will be a success, but I think its hard to compare this with the XBox and the Zune, which didn't create new product categories.

  • Stephen

    I respectfully disagree with most of this. Apple is not competing for 'budget-conscious consumers' - if it was, it would be competing with Google and Amazon etc. in the sub-$200 tablet market. As for the Surface, it does have great build quality and design - and so did the Zune. (and the XBox, too, just in case you think my point is related to the success or failure of the product).

    Nothing has changed, in fact. Microsoft has been building high-quality hardware for many years, and Apple's 'premium quality' strategy hasn't changed either. 

    The Surface is an interesting product - MSFT has decided it can bridge the gap between PC and tablet in a single form factor, and that its tablet will be more appealing to users who are 'locked in' to the MSFT ecosystem (especially Office). This is also nothing new, and is entirely similar to Apple benefting from having its own users locked into the iOS and (previously) iPod music ecosystems. Whether many users will judge the compromises which are inevitable in a 'bridge' device to be worth spending $600 on something which can do less than a Windows 8 laptop and less than an iPad, we'll see after the initial 3-month period of sales to brand loyalists is over and done. The vast majority of reviews have been tepid, at best. I think it will actually be a moderate success, in the long term, but MSFT's problem is that they need a big success to shake of the perception that they are yesterday's news.

    And lastly, I see nothing to separate the iPad Mini from the iPod Mini in representing continuation of Apple's strategy of many years. Apple has, for the past decade, introduced products at many different price points. The iPod Mini is the most obvious example; the first iPod Shuffle, and the Mac Mini are others. If Apple was doing what you claim it to be doing, it would have released a more cheaply-manufactured tablet (think plastic, think cheaper components) for $199. It didn't. Nothing has changed.

  • blinkmnt

    Apple has gone from influential to incremental ... Does the steam of Apple innovation is gone or they're just waiting and preparing ... ?

  • Guest

    And people laughed at the Blackberry Playbook. It is a pity that Backberry has loss traction!

  • Sarah

    Mark, awesome article. I passed this along to some coworkers - you got a nice discussion going in my office today.

    Even if Apple had intended on releasing the Mini all along, it still shows me that they remain a servant to the consumer, and not the other way around. It's cooler to think of Apple as an inventor and Edison-esque in its ways, but the bottom line is, it still has a product to sell, and demands to abide by.

  • Guest

    Thanks, this is way better unbiased analysis than Kit Eaton's usual apple commercials.

  • Gary Ricke

    Critics have panned Apple's releases since the IPod only to find later Apple knew what they were doing. This size could well have been a goal from the beginning but adoption, technology and manufacturing standards needed maturing. Not only has Jobs demonstrated mis-direction in the past but Apple has also demonstrated waiting to do something until it could do it right -- like multi-tasking. You may be right, but history has shown most who've predicted to know Apple's motives have been wrong. 

  • Gary Ricke

    True - the Newton, Ping, the IPod's first batteries. I'm definitely one that first thought non-support of Flash initially was a mistake. I'm just not sold on the notion that this is a defensive move and I'm more cautious on making or accepting predictions fresh on the release.

  • Michael Aldridge

    Apple have gotten it wrong plenty of times, they are just better than most at covering up their mistakes. Anyone remember the Apple Pippin (Games Console), or Apple TV or even Apple Maps.
    The thing is they seem to be getting it wrong increasingly often lately. I wonder if this is something to do with more spending on law suits than innovation these days.Shame on Apple and shame on the fanboys for still blindly defending them.