How many of us were surprised when we heard that the iPad was starting at $499? I for one was most certainly surprised, along with the many netbook makers that were planning on undercutting the price of the iPad. They were planning on dropping the price on the already low cost netbooks; however, this all changed when Steve Jobs announced the iPad at a whopping $499. Which leads me to my next point. Can the iPad be sold for less?
Well, according to a piece from the Wall Street Journal’s MarketBeat, this is exactly what Apple plans on doing. Now don’t get overly excited. There is no word that this will happen when the iPad launches at the end of March. This tactic will be employed if they see that the iPad isn’t selling well. It’s to soon to say if Apple is going to hit one out of the park with the iPad. I only say this because of how everyone is so split down the middle about Apple’s new device. Either you like it, or you don’t. It appears that right now there is no grey area.
According to an article by Cult of Mac the bill of materials breakdown for the 16GB iPad is $270 per unit. So Apple is making $229 per unit, and obviously there’s more profit in the higher storage capacity models. There is definitely wiggle room here for Apple to lower the price by $50 or even $100. They will definitely make it up in volume. I can also see Apple lowering the high end iPad’s by $125.
Apple is no stranger to price adjustments on their portable devices. The last time they did something like this was four years ago with the original iPhone. Back then it wasn’t because the iPhone wasn’t selling well. Just the opposite, the iPhone was selling like gangbusters, and Apple saw that they would sell more if they lowered the price by $200. This did cause a backlash in the early adopter community, but it soon was smoothed over when Steve Jobs said that anyone who purchased an iPhone in the first two months of its release would be receiving a $100 Apple gift card. Let’s hope if they decide to make a price adjustment it won’t be two months after the iPad has been released.
Photo Credit: iPad
[via @WSJ MarketBeat, @Cult of Mac]