Some might wonder why Apple hasn't simply offered the first-generation iPad for $299 -- similar to the pricing structure it uses with iPhones -- but according to the analysts we spoke with, the cost of producing the original model may not be that much less, meaning the profit margin may not be much different. Yet there's an even more fundamental issue.
"There's a certain amount of capability that they want current devices to have," says Michael Gartenberg, an analyst at the Gartner research firm, who notes that the first-generation iPad may already be a little too outdated to be marketed as part of Apple's current product line, no matter how much it costs. "We are already seeing applications that are sophisticated and complex that don't work on the original iPad. That's something that will only get worse over time."
As for the rumors about introducing an 8-inch version of the iPad that could potentially sell for less than $299, Enderle says it's unlikely, but not as unlikely as when Steve Jobs was in charge, given that he was adamantly against the idea of a smaller tablet."If Steve Jobs were running the company, I'd say absolutely not, but with Tim Cook running it, there is that possibility," Enderle says. "If the news coverage of Apple continues down the path of Amazon taking Apple's share, then they may be forced to go the 7-inch route." >To submit a news tip, email: email@example.com. Follow TheStreet on Twitter and become a fan on Facebook.
Select the service that is right for you!COMPARE ALL SERVICES
Jim Cramer and Stephanie Link actively manage a real portfolio and reveal their money management tactics while giving advanced notice before every trade.
- $2.5+ million portfolio
- Large-cap and dividend focus
- Intraday trade alerts from Cramer
- Weekly roundups
Access the tool that DOMINATES the Russell 2000 and the S&P 500.
- Buy, hold, or sell recommendations for over 4,300 stocks
- Unlimited research reports on your favorite stocks
- A custom stock screener
- Upgrade/downgrade alerts
Jim Cramer's protege, David Peltier, identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.
- Diversified model portfolio of dividend stocks
- Alerts when market news affect the portfolio
- Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
All of Real Money, plus 15 more of Wall Street's sharpest minds delivering actionable trading ideas, a comprehensive look at the market, and fundamental and technical analysis.
- Real Money + Doug Kass Plus 15 more Wall Street Pros
- Intraday commentary & news
- Ultra-actionable trading ideas
Our options trading pros provide daily market commentary and over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.
- 100+ monthly options trading ideas
- Actionable options commentary & news
- Real-time trading community
- Options TV