Charlie Rose spent a little more than 20 minutes discussing the iPad and what it means for users, the media markets, and competitors. So why am I posting this to TPN? I think that this device will be defining our relations to much of the media that we consume in the years ahead. This comes with some new levels of freedom regarding what we consume, when we consume it, and where we consume it (whether it be music, video, books or the web) but it also progressively ties us to Apple as our new gatekeeper. Should we embrace this future or be frightened by it? The famous Apple 1984 commercial feels like it might be inverting. Who is going to create the disruptive technology that unhooks us from the Apple media borg?
I, for one, think that the iPad will be a massive success. v1 is compelling and will get people drooling, even if it doesn’t have all of the features that everyone would want. Early tear downs of the product show that Apple is making really healthy margins on the device, somewhere around $220 profit on the $499 model. That means if Apple wants to crank up sales on the device, they could be selling at a $299 price point, still make a profit, and blow the doors off of holiday. Since Apple makes money off search on the device as well as via iTunes and the App Store, selling the product for near to cost neutral could make sense as long as they have a great supply chain. I expect that the device will be available in lower price points by holiday. As the product develops and becomes available on multiple carriers and adds features such as camera and GPS, sales will also accelerate. The future of Apple seems pretty darn healthy to me.
