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Apple takes a small bite of market

Last updated on: October 27, 2012 00:09 IST

Apple takes a small bite of market

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Priyanka Joshi in New Delhi


Apple, which revolutionised the tablet PC space with iPad, has now added a shrunken version, the iPad Mini. With a 7.9-inch screen, iPad Mini is smaller and less expensive than the traditional 10-inch model, but will support similar functions and apps.

With this, Apple is now poised to capitalise on the success of the iPad by targeting customers who are turned off by the tablet's size or its price tag.

Even though iPad Mini is said to compete with rivals like Amazon and Google, who have announced competitive 7-inch tablet PCs on the Android OS, Apple has maintained its premium brand tag and priced Mini starting at $329 against $159 for the cheapest Kindle Fire and $249 for the Nexus 7.

The iPad mini hits store shelves in the US starting November 2 but Apple has not disclosed its price for Indian markets or the launch dates.

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Photographs: Robert Galbraith/Reuters

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The India market - set to touch 7.3 million tablet units by 2015-16 - remains a nascent but steadily growing market. The bulk of Indian tablet PC market, estimate experts, tilts in favor of Rs 15,000-Rs 20,000 tablet PCs and most of the share is hoarded between Samsung and Micromax.

CyberMedia Research estimates that Micromax led the domestic market with 18.4 per cent share, followed by Samsung at second position with 13.3 per cent and Apple at third position with 12.3 per cent, in terms of sales (unit shipments) during the 2Q 2012. Also, Amazon Kindle or Google Nexus have barely any presence.

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Photographs: Reuters

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"India is a price sensitive market and the only challenge for the tablet PC's growth will be the prices of international players. With increasing penetration of computing devices in India, the sales of tablet PC's will definitely increase many folds making it a $800-million market by 2016" said Karan Chechi, research director with TechSci Research.

According to a new study by the industry body Manufacturers' Association for Information Technology (MAIT), sales of tablet PCs in India are at the edge of rising dramatically in the next five years.

The market for tablets may see a growth of up to 40 per cent each year for the next five years, with estimates suggesting sales of about 1.7 million units in this financial year. This would be a big jump from the sales last fiscal year at 1 million units.

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Photographs: Kind courtesy www.micromaxfunbook.com

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Apple's iPad Mini, if priced below Rs 25,000, may trigger off buyer interest. For Apple, believes Abhishek Chauhan, senior consultant, ICT Practice, Frost & Sullivan, this is a notable shift in strategy.

"Apple has been a premium brand, selling a few forward-thinking products that sat at the top of the market in innovation, design, and build quality. The iPad Mini isn't an attempt to be an iconic product; it is Apple diversifying their iPad line and going mainstream," he opines.

Analysts note that the iPad mini does address a new segment of the tablet market, and boasts of a feature set that is richer than competition. Furthermore, the 275,000 existing iPad apps are fully compatible with the iPad Mini, allowing Apple to leverage its existing rich app ecosystem.

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Photographs: Michael Dalder/Reuters

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The iPad Mini has the same resolution as the iPad 2, also includes a dual-core A5 processor, a front-facing FaceTime HD camera, Apple's 'Lightning' connector and a 5-megapixel back camera. Google, meanwhile, is expected to reverse Apple's strategy in coming weeks, by launching a 10-inch version of the Nexus.

The new shrunken iPad also makes an aggressive pitch to young buyers and executives who would prefer portability of a compact tablet device. CyberMedia Research suggests that about 90 vendors had launched their tablets till Q2 2012 with the average selling price of the tablets in Q2 2012 dropping to Rs 13,000 from Rs 26,000 in Q1 2012.

According to Faisal Kawoosa, lead analyst, CMR Telecoms Practice, "During Q2 2012, 47.4 per cent of tablet sales were from new entrants in the market with a strong focus on addressing application areas in the education and entertainment segments. This trend demonstrates clearly that vendors are positioning their devices at India's youth."

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Photographs: David McNew/Reuters

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The share of devices based on other operating systems like Windows, iOS and QNX is also expected to rise in view of the recent announcement of the Microsoft Windows Surface Tablet, the global launch of the new Apple iPad and reduction in BlackBerry Playbook prices, Kawoosa added.

Globally, the arrival of the smaller iPad is set to charge the market for 7-inch tablets, helping the market to approximately double in 2012 and 2013, according to a report by research firm iSuppli Display Materials & Systems Service. They are expected to account for 28 per cent of all tablets in 2012, up from 24 per cent in 2011. In 2013, the 7.x-inch share will rise to 33 per cent, said the report.


Photographs: Reuters

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