Apple Rumor Patrol: The Truth About The Long-Promised iPad Mini [Updated]

The rumor storm about the iPad mini is approaching the flood that preceded the first iPad. Here's how to swim with the deluge of data.

We've heard rumors of a smaller iPad for a couple of years now.

Steve Jobs himself once dismissed the idea, but he was famous for carefully controlling PR, and even making distracting statements. Now it appears the 7-inch iPad is finally on its way—and soon.

Battery

One of the more intriguing bits concerning the iPad mini's internal components that have "leaked" is its battery. MacRumors has got hold of a pre-production part that it deems likely to be a match for the final in-production battery—and it's pretty convincing. It has a capacity of 4490 mAh or 16.7 watt-hours. That's almost exactly three times the size of the iPhone 5's 5.45 watt-hours and a third of the iPad 3's 42.5 watt-hours.



Fishy Chippery

The mini's leaked battery details are not just trivial data. They imply that the mini may not be as powerful in terms of graphics or computing cycles as the full-on iPad, simply because there's less room in the battery for energy to drive more powerful chips. But we do know that the iPad 3 uses a double line of LEDs to light its retina screen, and these seriously munch into the 3's battery life. The mini is rumored to not have a retina screen, and this along with its small size means it may gobble down much less power per hour.

These arguments point to one of two main conclusions. The iPad mini may have a prodigious working battery life, lasting far longer than the iPhone does. Or it may be based on the iPhone 5 chipset (rather than the iPad 2 internals, as had previously been suggested) and thus have a more expected battery life, but deliver a computing performance that's as good as the iPhone 5 and far better than the iPad 2.

Wi-Fi-Only

A rumor a week ago suggested the new smaller iPad would come only with a Wi-Fi option, lacking the 3G capabilities of the bigger iPad. This rumor didn't chime with us because Apple has already shown it can design modular hardware for the bigger iPad, with the mobile broadband system slotting into the iPad's case as a daughterboard to the full motherboard. Why wouldn't it do the same trick, possibly even with identical circuitry, as it does for the full iPad? Technologically it wouldn't be tricky or expensive to develop, and it would give Apple the option of selling a more capable mobile device to users who may prefer its smaller screen size over the bigger iPad.

And remember—a mini iPad is going to be much more portable than a big iPad. Apple could make yet more money by letting its users have access to books, music, and apps on the go, and not just when they're in a Wi-Fi area.

Price

iPad mini SKU information, including price, has allegedly appeared in the systems of Media Markt, a German-based big box electronics retailer with a presence across Europe. The mini is, according to this info, due in 16 individual types: 8 each of white and black, with half of each color being equipped with mobile broadband and memory in capacities from 8GB to 64GB.

At the bottom end it'll likely cost $323 and the top-end version with broadband will be about $841. For comparison the Amazon Kindle Fire is $159 and the slightly more capable Google Nexus 7 is $199.

iBooks

According to one of the more recent rumors, Apple's launch even for the iPad mini will have a big element dedicated to iBooks. The 7-inch or so screen the new iPad is said to sport is roughly the size of a large paperback book's page, and if it features the same in-cell touch sensing as the iPhone 5 this means the display will make for an excellent e-reader.

Apple's already made a big push for e-textbooks and compared to its other content offering systems it seemed that at first iBooks wasn't quite so well used. In January Apple pushed out iBooks 2 and an authoring tool to let anyone put together a book for the platform and that immediately led to 350,000 book downloads and 90,000 downloads of iBooks Author in the first three days. Perhaps now is the perfect time to remind schools and home users of iBook's power, and to push a device that seems ideally suited for consuming reading material.

The Future

All of these pieces of the puzzle join pleasingly together, and they don't necessarily point to a 7.85-inch iPad as being the simpleton, low-price cousin to the iPad. What they may imply is that the mini is going to be a very capable device, possibly among the top in its size class and easily outperforming its immediate peers.

It seems to be priced aggressively. The low margin entry level system—at around $250—is Apple's version of a "loss leader," and it's countered by the bigger units with more memory and mobile broadband units. Apple makes more money on these larger capacity devices, as it has long done so on all iDevices, because it charges a premium for the memory chips.

This strategy is in stark contrast to Amazon's strategy with the new Kindle Fire, which is sold in a one-size-fits-all capacity and at zero profit to Amazon. Jeff Bezos' company makes all its money from the Fire on selling apps, books, and other content for it—and can do so because the Fire is running so heavily a modified version of Android that it can basically only access material from Amazon's digital lockers. Apple's machine is similarly tied to Apple's iTunes system, but is also free to run apps that deliver content from other partners. But Apple makes money on both the hardware and the software.

An iPad mini with more power than the iPad 2, perhaps approaching iPhone 5 class power, also makes sense in terms of Apple's future product portfolio. The iPad 4 is presumably due in Spring, and if it were much more than a generation ahead of the iPad mini in terms of performance then it would make the mini look like a very poor buy for at least the next six months until that product was upgraded.

Will it cannibalize "full" iPad sales, or damage the iPod touch's sales figures? That's hard to predict, but Apple seems to have pitched its size far above the iPod and significantly less than the iPad—meaning it'll appeal to different users.

Update


Piper Jaffray analyst Gene Munster, with a long track record of looking at Apple, has weighed in on the cannibalisation issue. Munster sees every five iPad minis sold resulting in the loss of sale of one full-size iPad. Assuming the mini goes on sale November 2nd, Munster imagines five million will be sold in the December quarter, which will adjust full iPad sales downward by a million. It does represent an upside for Apple though, so he's increased his earlier estimate of iPad sales for the quarter upward from 21 million to 25 million. Assuming minis comprise a quarter of total iPad sales in 2013, Munster sees 95 million being sold in the year versus his earlier estimate of 86.5 million.

His analysis also highlights that the arrival of the mini at a significantly reduced price versus the full-size iPad will result in a lower average price for the device. While this is undeniable, we argue this probably won't reflect in Apple's bottom line because Apple will likely draw more profit from iPad minis and the long-tail of iTunes app, music and TV content sales that the increased iOS customer base will deliver.
[Image: Flickr user danpawley]

Chat about this news with Kit Eaton on Twitter and Fast Company too.

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1 Comments

  • Marc

    The Truth:  Kit Eaton will be masturbating over the iPad Mini nonstop for the rest of the year.