Steve Jobs Said No

In October 2010, Steve Jobs had this to say in response to rumors of a 7” version of the iPad:

“The reason we won’t make a 7 inch tablet isn’t because we don’t want to hit that price point, it’s because we think the screen is too small to express the software.  As  a software driven company we think about the software strategies first. We know developers aren’t going to deal well with these different sizes and they have to change their software every time the screen size changes.  When we make decisions on 7-inch tablets it’s not about cost, it’s about the value of the product when you factor in the software.”

Now, it’s 2012, and the late Steve Jobs would probably appreciate the news that Apple will indeed deliver a 7” iPad by the end of the year.  As thoughtful as Jobs was about the developer community, the 7” tablet size and form factor seems to be a sweet spot for consumers regardless of the price point.  Android tablets that manage to eek away at Apple’s iPad market are typically that size and priced below $250.  At the end of 2011, the most popular and best selling tablet was the Amazon Kindle Fire, running its own proprietary version of Google’s Android operating system.  For Amazon, this was a huge validation of their bet that the perfect sized tablet at the perfect price point – even without the whole Android OS – could not only be a contender, but dominate the tablet market.  For other tablet makers, it was a turning point that forced them to slash the prices of existing 10” Android tablets and consider manufacturing smaller sized devices.

The People Say Yes

The most wanted tablet is still the iPad.  With the iPad 2 and the new iPad running side by side as current models, the price of the iPad 2 has been slashed by $100.  That means that the entry level iPad 2 with wifi and 16gb starts at $399 – still a far cry from 7 inch Android tablets that cost nearly $100 less on average.  A 7” iPad, priced between $200 and $250 would likely take a substantial bite out of Android devices that currently enjoy dominance in that market. iPad has one of the most advanced displays among all the tablets, especially for watching streaming video on Netflix or the DirecTV app.  There are still consumers who are simply loyal to the Android OS, however, and they are not likely to be swayed by a smaller, less expensive iPad.    In the time that has passed since Steve Jobs made his argument against a lighter and more compact version of its award winning tablet, several Android tablets have taken advantage of the gap left open.  The Samsung Galaxy Tab 7 and Amazon’s Kindle Fire have enjoyed phenomenal sales in the shadow of the sleeping giant that is the mythical 7” iPad.  For those of us who have been patiently waiting, Q3 can’t get here soon enough.