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Rumor Report: Apple's Upcoming iPad Mini Will Crush the Competition

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A report this week by market research firm IHS iSuppli foresees record sales of tablets in the future. Specifically, IHS said it expects unit sales to grow 85% to around 126 million devices in 2012, with Apple's (Nasdaq: AAPL  ) iPad grabbing 61% market share. If they took a poll on how many investors were surprised by this news, it wouldn't be many. However, something that may truly amaze Mac maniacs is the idea that Apple is developing a new touch technology for the October launch of an iPad Mini.

Show and tell
If the rumors are finally true, the most valuable company in the world may launch a 7.85-inch version of its popular iPad tablet this fall. This is another smart move by the Mac maker, and the timing couldn't be better. Tablets equipped with Microsoft's (Nasdaq: MSFT  ) Windows 8 software are set to launch in time for the 2012 holiday season, along with an onslaught of other PC-tablet hopefuls.

The new entry-level iPad could deliver a devastating blow to rival (Nasdaq: AMZN  ) and others in the tablet space. Research In Motion (Nasdaq: RIMM  ) tried its hand in the tablet market with the launch of its dirt cheap 7-inch BlackBerry PlayBook last year, which proved that competitive pricing doesn't guarantee success. The BlackBerry maker even tried to revamp its operating system, releasing a second PlayBook device only to see sales yet again disappoint.

RIM wasn't alone, either. Barnes & Noble (NYSE: BKS  ) made countless attempts to crack the iPad code of conquest. The book retailer's latest Nook product fell flat, despite its competitive $199 price tag, which was meant to help it compete with the Kindle Fire. Unfortunate as it was for the other companies, Amazon's Kindle Fire was the only iPad alternative to hold a candle to Apple's dominance in the tablet market.

Gunning for No. 1
However, that could change if the rumors about the iPad Mini prove to be true. According to Digitimes, Apple's new miniaturized tablet will use what's known as "G/F2" thin-film touch technology, giving it a thinner design compared with the existing iPad. And if industry sources are on the right track, the iPad Mini could cost between $200 and $250 a pop -- aligning it with Amazon's Kindle Fire, which sells for $199.

The Kindle Fire seized some of the tablet market last year, decreasing Apple's stake to 55.1%. But a new and cheaper iPad could cause Apple to trample the competition in its climb to the top. If the product comes to fruition, I have no doubt it will be a win for Apple.

Apple appears to be set to dominate the world, but it won't all be smooth sailing for the iDevice giant. Read all about Apple's opportunities and risks in this premium research report on Apple from The Motley Fool. With expert insight, it could help you make a smarter investing decision about whether you should own the stock.

Fool contributor Tamara Rutter owns shares of Apple and Follow her on Twitter, where she uses the handle @TamaraRutter, for more Foolish insights and investing advice. The Motley Fool owns shares of, Apple, and Microsoft. Motley Fool newsletter services have recommended buying shares of, Apple, and Microsoft, as well as writing puts on Barnes & Noble and creating bull call spread positions on Apple and Microsoft. The Motley Fool has a disclosure policy. We Fools don't all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. Try any of our Foolish newsletter services free for 30 days.

Read/Post Comments (6) | Recommend This Article (8)

Comments from our Foolish Readers

Help us keep this a respectfully Foolish area! This is a place for our readers to discuss, debate, and learn more about the Foolish investing topic you read about above. Help us keep it clean and safe. If you believe a comment is abusive or otherwise violates our Fool's Rules, please report it via the Report this Comment Report this Comment icon found on every comment.

  • Report this Comment On May 18, 2012, at 7:41 AM, jdmeck wrote:

    Not happening. iPad's are updated in late winter. iPhones are updated in the fall and MACS are updated in the summer. So maybe next year there will be a mini, if at all. I'm not convinced.

  • Report this Comment On May 18, 2012, at 10:59 AM, Sabos wrote:

    The ridiculous and persistent rumor of the iPad mini refuses to die. I'm not sure why but there is no way that they're true. Demand and sales for tablets <10" have consistently failed to materialize, user satisfaction with <10" is very low, the run rate for the current model iPad is strong, and it would be entirely against history and Apple's nature to launch a cheaper, smaller device. The bottom line is that market forces, company history, or common sense suggest that this could possibly be true, and the details of this are always suspect or wrong. So how about we stop the speculative BS based on no facts at all?

  • Report this Comment On May 18, 2012, at 11:01 AM, infektu wrote:

    "the rumor mill says that apple has a product up their sleeve that will sell one trillion units a quarter"...

    Now that's some serious info.

    Besides being funny, anything goes when one has not dumped their shares on time...

  • Report this Comment On May 18, 2012, at 3:02 PM, etgh wrote:

    The Apple sock-puppets are out in full force preparing for the launch of the 7" iPad.

    Now, the "divine" Steve Jobs labeled 7" tablets as DOA and the iSheep all bleated in unison shouted.... 7" DOA !... 7" DOA !....7" DOA !

    Now, all the iSheep are bleating.... 7" Perfect Size !.....7" Perfect Size !.......7" Perfect Size !!

    Poor iSheep. Fortunately they now have Suri to tell them what to think and what to buy or they would be totally lost.....

    I wonder if you could get them all to "dress up" in funny costumes......

  • Report this Comment On May 18, 2012, at 10:10 PM, haysdb wrote:

    It wouldn't be the first time Apple indicated they would not do something, and then did.

    I haven't heard anyone suggest 7" is the perfect size, but it would be a nice size for a number of things: kids (small hands), reading, commuting (cars, trains). And thanks to iCloud, it wouldn't be an either/or proposition, but rather an "I'll have one of those too, thank you."

    It may be the reason 7" tablets have not seen a lot of success is that all of them suck. Maybe it's not the size that's the biggest problem.

  • Report this Comment On May 18, 2012, at 11:06 PM, JimmyZangwow wrote:

    This cognitive blind spot blotting out everything that isn't by, for, about, or due to Apple has grown tiresome.

    I'm just sayin'.

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