Apple (NASDAQ:AAPL) unveiled new iPad models on Tuesday and for the first time T-Mobile US (NYSE:TMUS) will sell service for the popular tablets.
iPad Air (left) and Mini (Image source: Apple)
Apple made its tablets faster and expanded LTE support for the smaller iPad mini but did not deliver major new hardware upgrades (for example, neither supports the TouchID fingerprint scanner that debuted last month with the iPhone 5s).
T-Mobile CEO John Legere recently hinted on Twitter that T-Mobile might start selling the iPad after giving indications in August that the No. 4 carrier would soon get other Apple products beyond the iPhone. The three other Tier 1 carriers all carry both the iPad and iPad mini.
Verizon Wireless (NYSE:VZ), AT&T Mobility (NYSE:T), Sprint (NYSE:S), U.S. Cellular (NYSE:USM), C Spire Wireless and Bluegrass Cellular will get the new iPads as well.
As GigaOM notes, Apple has managed to cram 14 different LTE bands into the new iPads, including all of the major U.S. bands, as well as many key bands across Europe and Asia. Although the iPads do not support nearly as many LTE networks as Apple's new iPhone 5s and 5c models and do not support TD-LTE networks, Apple has managed to make only one hardware variant each for the new tablet models.
Apple announced the new fifth-generation 9.7-inch iPad Air, a thinner and lighter version of the existing full-size iPad, as well as a new iPad mini. The tablets both run Apple's new A7 processor, a 64-bit chipset. The new iPad Air will sport a 2048x1536 pixel resolution Retina display, 5-megapixel iSight camera and 1080p FaceTime camera. The new iPad mini will have the same cameras and, for the first time, a Retina display for its 7.9-inch screen.
Apple CEO Tim Cook used the company's media event to tout that since the first iPad debuted three and a half years ago, the company has sold 170 million iPads. He also said there are now more than 475,000 iPad-specific apps. "This is an incredible number…I can't think of another product that has come so far, so fast," he said, according to AllThingsD.
The iPad Air will start at $499 for the 16 GB model with just Wi-Fi, and $629 for the 16 GB model with cellular connectivity. Those prices increase to $599 for the 32 GB model with Wi-Fi, $699 for the 64 GB model with Wi-Fi and $799 for the 128 GB model with Wi-Fi, and go up to $729 for the 32 GB cellular model, $829 for the 64 GB cellular model and $929 for the 128 GB cellular model. The iPad Air starts shipping Nov. 1, including in China, and the new iPad mini will be available in November.
The new iPad mini will start at $399 with Wi-Fi-only connectivity and 16 GB of storage, $499 for 32 GB of storage, $599 for the 64 GB version and $699 for the 128 GB model. The iPad mini with LTE will start at $529 with 16 GB of storage, $629 for the 32 GB version, $729 for the 64 GB model and $829 for the 128 GB cellular version.
The first-generation iPad mini will drop down to $299 for the 16 GB model with Wi-Fi, but the older iPad 2 will stay at $399 for the 16 GB model with Wi-Fi.
Apple unveiled its third-generation full-size iPad in March 2012 and its fourth-generation iPad only a few months later in October 2012, when the first-generation iPad mini was introduced.
Analysts said that the iPad mini will likely stand apart mainly for its price, especially compared to cheaper 7-inch tablets, such as Amazon's (NASDAQ:AMZN) Kindle Fire HDX (which starts at $229 for the 16 GB model with Wi-Fi) or the Google (NASDAQ:GOOG) Nexus 7 (which also starts at $229 for the 16 GB model with Wi-Fi).
"Consumers looking for a high-performing 7-inch or 8-inch tablet at a low end price will not find such a device from Apple," Informa Telecoms & Media analyst Julian Jest said. "Instead, tablets with similar specifications as the iPad Mini from rival vendors retailing at $170 less, including the Nexus 7 from Google and Amazon's Kindle Fire HDX, will continue to be popular alternatives. And it is difficult to see how consumers would pay a $100 premium for the retina display and A7 chip on the latest iPad Mini model, as impressive as both features are."
Cook also said at the event that there are now more than 1 million apps in the company's App Store and more than 60 billion downloads. Developers have now earned more than $13 billion from the App Store, he said. Cook also said that 20 million people have streamed more 1 billion songs over iTunes Radio since the service went live last month with the debut of iOS 7.
In July, Apple reported that in its fiscal third quarter it sold a total of 14.6 million iPads. In the year-prior quarter, Apple shipped 17 million iPads. Apple is set to report earnings for its fiscal fourth quarter on Oct. 28. However, even if Apple's iPad sales growth appears to be cooling, the overall tablet market is not, according to research firm Gartner.
Gartner reported earlier this week that PC shipments are expected to decline 8.4 percent in 2013 to 303 million units, while tablet shipments are expected to grow 53.4 percent this year, with shipments reaching 184 million units.
"Premium tablets are faced with continued price decline in the 7-inch form factor as a larger number of consumers prefer smaller form factors when it comes to content consumption," Gartner said. "A recent consumer study that Gartner conducted in Brazil, China, France, Germany, Italy, the UK, the U.S. and Japan confirmed Gartner's long-standing assumption that smaller is better when it comes to consumer tablets. The survey showed that the average screen sizes of the tablets in use across the countries ranged from 8.3 inches to 9.5 inches. Forty-seven percent of the 21,500 consumers surveyed owned a tablet that was 8 inches or less."
Despite the expected growth in tablet sales, most U.S. customers have not yet bought into the idea that they need cellular connectivity for their tablets. According to a May report from the NPD Group, the percentage of tablets that actually do connect to 3G or 4G networks is relatively small -- NPD found that only 12 percent of all tablets in the U.S. connect to cellular networks.
Verizon, AT&T, U.S. Cellular and C Spire have introduced shared data plans to try to make the cost of adding a cellular tablet connection less expensive, and AT&T recently introduced a $5 tablet plan that will give subscribers 250 MB of data for a single day as well as a $25 plan for 1 GB that can be used any time in a three-month period.
- see the Apple release
- see this Apple page
- see this The Verge live blog
- see this AllThingsD live blog
- see this GigaOM article
- see this WSJ article (sub. req.)
- see this CNET article
T-Mobile's Legere hints at plans to sell iPad
AT&T launches $5/day tablet data plan, powers Tesla's wireless services
Apple sells 9M new iPhone 5s, 5c models in debut weekend
Apple's iPhone 5s goes on sale, with gold version reportedly in tight supply
T-Mobile CEO Legere promises more Apple products
Article updated Oct. 23 with additional information and commentary on the new iPad models.