While supply constraints are par for the course when it comes to iPad releases, an analyst says the supply of the iPad Mini could be even tighter than usual.
Richard Shim, senior analyst for DisplaySearch, says: "The new low price point is expected to appeal to a wider audience and drive up demand. However, panel supply chain indications point to an even more than typical tightness in the market for the iPad Mini."
The iPad Mini was revealed by Apple this week after months of speculation. The new smaller iPad features a 7.9-inch display, 1 024 x 768 resolution, an A5 dual-core processor and up to 10 hours of battery life. While the iPad Mini will be available in both WiFi and cellular models, the entry-level 16GB WiFi version has a starting price of $329.
The fourth-generation full-size iPad was also unveiled this week, featuring the same Retina display and design as its predecessor but with an A6 processor. The 16GB WiFi model starts at $499.
Pre-orders for the new iPads will open in select regions on 26 October and will begin shipping on 2 November. According to Shin, Apple is expanding its supplier base with new partners for the iPad Mini.
"Apple will continue to work with LG Display, who is supplying panels to Foxconn for the finished product, and is adding AUO, who will supply panels to Pegatron. However, AUO is having yield issues with the 7.9-inch panel which is limiting their supply to Pegatron, and in September, AUO shipped just over 100 000 units."
Shin says the production plan for AUO is to reach 400 000 units in October, 800 000 in November and one million in December. LG Display is said to have shipped 300 000 panels in September, and plans to ship one million in October, 2.5 million in November, and three million in December.
In previous iPad launches, LG Display and Samsung have been the main panel suppliers, with what Shin says was roughly equal panel production.
"Samsung has been one of the leading panel suppliers for the iPad. In fact, when the new iPad was first released, Samsung was the only supplier that could meet production orders with LG Display gradually ramping up to meet demand. However, Samsung and Apple appear to be winding down their relationship, most likely due to the legal conflicts the two have been embroiled in recently."
Maintain momentum
Forrester analyst Sarah Rotman Epps says the iPad Mini is the "best outcome of a worst-kept secret".
"As early as October 2011, credible reports from Taiwan surfaced about a 7.85-inch iPad, so it's no surprise to see this product. And yet, Apple's execution dazzles. You pick up this device -which weighs only 0.68 pounds - and it feels feather-light, perfectly weight-balanced - and decidedly not made out of plastic, as its competitor devices are."
Rotman Epps adds that while the price point of the iPad Mini doesn't meet competitors' lowest prices, it doesn't have to. "Shaving $170 from the price of the 9.7-inch iPad makes this device more affordable for more consumers in more countries. Apple is entering the 2012 holiday season with its strongest product line-up ever, with wider retail distribution than it has ever had.
"Apple already has momentum and leading market share in every category: it has the best-selling models of desktop (21.5-inch iMac), notebook (13-inch MacBook Pro), tablet (iPad 3), phone (iPhone), and MP3 player (iPod). So its new products aren't 'game changers,' as such, because Apple is already leading every game it plays. But these products will maintain Apple's momentum," concludes Rotman Epps.
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