Tim Cook Defends Apple’s iPad Mini Pricing

Tim Cook Defends Apple’s iPad Mini Pricing

During Apple’s quarterly earnings conference call this afternoon, Tim Cook stood up in defense of Apple’s iPad Mini pricing, explaining that profit margins for the iPad Mini are lower than any other current Apple product.

Both Tim Cook and Apple CFO Peter Oppenheimer emphasized that the iPad mini is higher quality than competing tablets, and has significantly more screen real estate – a 35% larger screen than tablets like the Nexus 7 and Kindle Fire HD.

Specifically, Oppenheimer noted:

When we set out to build [the iPad mini], we didn’t set out to build a small, cheap tablet. We set out to build a smaller iPad that offered the full iPad experience. The fit and finish of our precision enclosure is breathtaking when held in your hands. That’s what we’ve done, the iPad mini has higher costs and gross margin is significantly below our corporate average. Height of the cost curve, but we want to make a large number and we’re going to work to try to get down the cost curve and get more efficient with manufacturing as we’ve done with our other products.

It’s notable that Apple is making less of the iPad mini than the remainder of their product lineup, and makes that $329 starting price seem a little less pricy than some have cast it as!

 

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  1. MRonin says:

    Honestly I was expecting something starting at the 300 mark so 29 bucks over that it’s earth shattering. I still contend the entry cost will lower itself by this time next year. I’m glad Apple didn’t just put out a half assed iPad in a smaller case and call it done.

    Now do I believe any company when they start talking about how “slim” their profit margins are on their products? Nope I don’t because it’s inevitably not totally true or entirely accurate. I’m not saying that Apple is making their margins look smaller to bolster the 329 dollar starting price, I’m just saying that I don’t believe ANYONE making those kinds of claims while in the midst of defending the price of their product.

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