According to a recent investor's note from Citi Research, Apple intends to begin selling an iPad mini with a price point nearly $100 below what the current model retails for.
While a price drop from $329 to around $250 would certainly better enable Cupertino to compete with more cheaply priced Android tablets, it seems rather unfathomable that Apple would institute such a dramatic price cut for the iPad mini 2, particularly given the fact that it is widely expected to feature a Retina Display, which would greatly increase manufacturing costs.
Rather, it seems far more plausible that the Citi Research note would refer to a price cut on the original iPad mini, or perhaps a slightly updated version. The iPad mini 2 on the other hand would still release at the original price point of its predecessor, around $329.
"Supply chain checks by Citi's Asia-Pac Technology Team suggest a mix shift surprisingly toward Apple's older iPhone4/4S," wrote Citi Research analyst Glen Yeung in an investor note obtained by CNET. "And with our expectation of a low-end iPhone slated for September launch, followed by a sub-$250 iPad Mini, we expect this trend to persist."
The Citi Research note echoes an April memo from KGI Securities analyst Ming-Chi Kuo. In the note, Kuo suggests a number of strategies Apple might pursue in order to drive down the costs of the iPad mini 2 and allow it to compete with Android devices, which typically target a lower price point and have had more success penetrating lower-income demographics.
"Prior to iPad mini 2 launch, Apple might roll out a more affordable iPad mini to compete with Android products. To cut costs, Apple might push for lower component prices, use a more advanced process to produce the A5 processor, simplify metal casing production, remove the rear camera, cut storage to 8GB and find more component suppliers to lower costs. We think this cheaper iPad mini retail for US$199~249."
Whatever the case may be, it's likely we won't have to wait much longer to find out. Apple's WWDC 2013 kicks off on June 10 and it's more than likely that the iPad mini 2 will be unveiled there.
