Apple hasn’t released a smaller form factor iPad, but rumors claim one is in the works — or at least in Apple’s labs. Should the company decide to release a smaller iPad model, it would turn into a nightmare for Apple’s competition, according to Sterne Agee analyst Shaw Wu.
“From a competitive standpoint, we believe an iPad mini with a lower price point would be the competition’s worst nightmare,” Mr. Wu said. “Most of them already have a tough enough time competing against the iPad 2, as well as the new iPad with their $399 and $499 starting price points.”
A smaller iPad could strike fear in the hearts of Apple’s competition
He added that Amazon’s Kindle is the only tablet that’s had any level success in competing with the iPad.
According to Mr. Wu’s checks, a smaller iPad model has been in development for some time, but isn’t expecting to see anything from Apple for now.
“We have picked up evidence since 2009 of Apple working with smaller, as well as larger screens ranging from 4-inches to 12-inches that could be used in a future iPad, iPod touch, and/or iPhone or even MacBook,” he said. “We do not sense that the release of an iPad mini is imminent and quite frankly, exact timing is difficult to predict. However, we do believe it makes both fundamental and strategic sense for Apple to address at some point.”
Assuming Apple does release a smaller screen iPad, Mr. Wu expects it to support a 1024x768 resolution, which would save developers from having to code their apps for yet another screen size since that’s the same resolution found on the iPad and iPad 2. Cutting down on the screen sizes to support would be yet another selling point for developers who already deal with a growing list of screen sizes, shapes and resolutions.
Mr. Wu is maintaining his “Buy” rating and US$750 target price for Apple’s stock. Apple is currently trading at $588.75, up 8.62 (1.49%).