Antena 3 CNN Tech 3 reasons why Apple should build a smaller iPad

3 reasons why Apple should build a smaller iPad

3 reasons why Apple should build a smaller iPad
06 Iul 2012   •   02:00

Reports are suggesting that Apple is working on a smaller version of its market-leading iPad, in order to compete with Google's new Nexus 7 and Amazon's Kindle Fire.

The smaller tablet probably wouldn't have the high-definition Retina screen of the larger 10-inch model, but would probably be available at a more budget-friendly price, perhaps around $200.

Even though Steve Jobs was vocal about his skepticism for smaller tablets and Apple has always shied away from going directly after competitors, Bloomberg says the computing giant plans to release a 7- or 8-inch iPad before the end of the year, possibly in October.

Why the sudden change of heart? Here are three possible reasons:

1. Apple sees Google as a real threat and is trying to quash any momentum that the search giant hopes to build before the Nexus 7 is even released.

2. A smaller tablet opens up new markets

3. It would make Apple a lot of money. The gross margin on the existing $500 iPad is roughly 37 percent, and the company could earn a similar profit by using a cheaper, non-Retina screen on this smaller model. Plus, Apple would be keeping budget-conscious buyers in the iTunes/App Store ecosystem, which means more revenue on the long run.

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