Home Why the New iPad is So Huge for Apple

Why the New iPad is So Huge for Apple

Maybe it didn’t seem like it, but today’s new iPad introduction was Apple’s most important event of the year.

Sure, the iPhone is still a bigger business for Apple, and probably will be for a while. But the iPhone is just Apple’s small sliver of the giant phone market.

The iPad, meanwhile, is a green field – a totally new market that Apple is building and defining. And so far, it has it almost to itself. It’s the future of Apple and potentially the future of the personal computer. That’s a rare and tremendous opportunity.

The Best Tablet, But Also the Best Price

Today’s new iPad continued two important trends for Apple.

First and foremost, the iPad maintained its lead as the best tablet on the market in terms of hardware, software, and ecosystem.

Between the retina display – unmatched by the competition – and the Apple TV accessory, Apple’s tablet story is richer and more useful than Amazon’s, Samsung’s, or anyone’s.

But Apple also continues its price-to-value leadership.

Sure, Amazon’s Kindle Fire is cheaper in total dollars, and so are a bunch of low-end Android tablets. But the iPad’s value is much higher. The competition already struggles to come close to the iPad’s quality, but Apple’s pricing makes the iPad even harder to match.

And don’t overlook the importance of the price-cut iPad 2, now starting at $399.

By shaving $100 off the cheapest iPad’s price, Apple has significantly expanded the iPad’s addressable market. Many of those would-be buyers will end up spending another $100 or more on a new iPad, once they’re in the store and have had a chance to see the retina display. But the cheaper iPad 2 “carrot” is another big development for Apple, and should sell well, expanding the total iPad market.

iPad vs. the PCs

“We think that iPad is the poster child of the post-PC world,” Apple CEO Tim Cook said today. Then he showed this chart, plotting Apple’s December quarter iPad shipments against the shipments from the world’s biggest PC makers. The iPad – not even two years old at the time – won. Pretty crazy, right?

But that’s Apple’s giant, unique opportunity here: To build something bigger than the PC industry ever was. Because the iPad is cheaper and more portable and more natural than any high-end PC ever was, even Apple’s own Macs. And today’s new iPad is, by a wide margin, the best iPad ever made. So it’s Apple’s strongest candidate to keep driving that post-PC vision.

The Year of the ‘iPad’

Why is the new iPad called ‘iPad’ and not ‘iPad 3’, or something like that? Here’s one reason: Because, for the majority of the people who buy it, it will be their first iPad – not their second or third. Who wants to start a revolution with no. 3?

Apple could potentially sell 80 million iPads this year, about twice as many as it did last year, and more than the number of iPad 1s and iPad 2s combined. At an average price around $550, that’s about $45 billion in sales – about the same amount as all of Applegenerated in 2009, the year before the iPad launched.

So: An excellent new product. A big, rare market opportunity. And a giant, fast-growing business.

The new iPad may seem like a modest, evolutionary upgrade, if you were only looking at the headlines. But it is truly huge for Apple.

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The ReadWrite Editorial policy involves closely monitoring the tech industry for major developments, new product launches, AI breakthroughs, video game releases and other newsworthy events. Editors assign relevant stories to staff writers or freelance contributors with expertise in each particular topic area. Before publication, articles go through a rigorous round of editing for accuracy, clarity, and to ensure adherence to ReadWrite's style guidelines.

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