Apple's iPad Mini Event: What to Expect

Apple (Nasdaq: AAPL  ) has a big day tomorrow. The company is hosting an event in San Jose, Calif., and is widely expected to unveil its new iPad Mini in an aggressive down-market move into the small-sized tablet arena. That's not all the iPad maker has in store, though. Let's round up everything investors can look forward to tomorrow.

What to expect when you're expecting
As far as the feature presentation is concerned, the iPad Mini is expected to carry a 7.85-inch display, notably smaller than the current 9.7-inch display of existing models. As a more affordable offering, the device isn't likely to carry bleeding-edge specs like the third-generation iPad does. The display won't be in Retina territory and should have the same resolution as older iPads at 1,024 x 768. Since the display will be smaller, this will translate into higher pixel density.

Perhaps more important, since this is the same resolution as older models, there should be no issues with app compatibility or fragmentation, and all existing iPad apps should easily run on the smaller tablet right out of the box. The iPad Mini is rumored to be built using the same internal components as the iPad 2, such as the A5 processor. That could make sense with the possibility of Apple killing the iPad 2, effectively using the same guts in a smaller body.

The biggest unknown at this point remains pricing. Where Apple decides to price the device relative to dominant incumbents like Amazon.com's (Nasdaq: AMZN  ) Kindle Fires and Google's (Nasdaq: GOOG  ) Nexus 7 is critically important to its success. Those devices start at $199, and while Apple products always carry a premium, it needs to remain competitive. Starting prices are rumored anywhere from $249 to $329, with additional pricing tiers for additional storage ($100 increments) and cellular connectivity ($130 premium).

Nov. 2 has been pegged as the tentative launch date, which coincides with Apple's historical norms of launching products the following Friday after unveiling.

The new "new iPad"
Apple's third-generation iPad, technically dubbed the "new iPad," may even see an incremental upgrade. That's somewhat unusual, since it's only halfway through its typical one-year product cycle. Apple may take the opportunity to update the full-size tablet with a Lightning connector like the one debuted in the iPhone 5, and potentially bump the processor from the A5X to the A6.

The updated model may see some internal improvements related to thermal improvements or the use of IGZO display technology. The most compelling reason to pursue a six-month update would be to add support for international 4G LTE frequency bands, since the current model only supports frequencies in North America. Earlier this year, Apple's marketing landed in hot water Down Under since the new iPad doesn't support Australian LTE networks.

Learning new tricks
Apple is also expected to focus heavily on education. There have been hints that Apple will release a major update to its iBooks app to bolster its educational capabilities. The iPad 2's lower $399 price point has helped it gain traction in the education sector, and the iPad Mini's even lower price point will likely increase Apple's penetration in this massive market.

The Center for Digital Education estimates that between $5.2 billion and $5.7 billion was spent last year on all hardware in the K-12 market. Tablet ownership among college students also more than tripled this year to 25%.

Just last week, Amazon announced a new Whispercast service for easily purchasing and distributing e-books through large-scale Kindle deployments, while it has also been selling Kindles to schools at bulk discounts. Amazon is Apple's most credible threat in education, given its low-cost e-readers and larger content library, so a competitive response in this sector is in order.

Back to the Mac
Numerous Mac product families are also overdue for some updates, including the latest Ivy Bridge processors from Intel (Nasdaq: INTC  ) and Kepler graphics chips from NVIDIA (Nasdaq: NVDA  ) . Apple began switching its Mac lineups to both of these chips earlier this year and they have yet to make their way throughout some offerings.

The iMac may see a redesign, and the Mac mini will probably just get beefed-up internals. Apple will probably show off a 13-inch MacBook Pro with Retina display, following up the 15-inch version that was launched this summer. It should take similar design cues, such as losing the optical drive and becoming thinner and lighter.

'Tis the season
Tomorrow's event will cement Apple's product lineup heading into the important holiday quarter. In September, the company unveiled a whole slew of new iPods alongside the iPhone 5. This month, Apple will beef up its iPad offerings and upgrade the rest of its Macs.

'Tis the season for Apple investors to be jolly.

The iPad Mini carries with it important strategic implications about how Apple plans to tap the broader tablet market that is showing signs of explosive growth. For just that reason, I've recently put together a comprehensive report all about the iPad opportunity ahead of Apple and how the product family could easily translate into a decade of growth and billions of dollars in profits for the company and its investors. It's included as a bonus in our Apple research service, which you can learn more about by clicking here.

 

Evan Niu, CFA, owns shares of Apple. The Motley Fool owns shares of Apple, Amazon.com, Google, and Intel. Motley Fool newsletter services recommend Apple, Amazon.com, Google, Intel, and NVIDIA. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.


Read/Post Comments (8) | Recommend This Article (27)

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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 October 22, 2012, at 5:05 PM, LarryBright29 wrote:

    Thanks for very informative article and a good question in the heading.

    AAPL with $594 billion market value has most growing weight in the Technology Sector.

    Both AAPL and SPY "Spider" have large market capitalization and are considered relatively 'safe' investments. Playing one against the other would be like speculating on the high-tech VS. the whole market, or NASDAQ VS. NYSE. Which one will outperform the other?

    Good article on Playing AAPL - S&P 500 Spread As “Market Neutral” Strategy by Dr. Roitman

    http://bit.ly/TMja69

    Good Trading!

  • Report this Comment On October 22, 2012, at 5:38 PM, ghstflame wrote:

    Why would the price point the ipad mini below the current gen ipod touch ($299) which does have the retina display.

    The whole thing smells fishy.

  • Report this Comment On October 22, 2012, at 7:30 PM, bfsteck wrote:

    I wanted to hear about the company that Jobs was so irate about and ended up VERY frustrated with a pitch to subscribe to "...Rule Beakers". I don't doubt that is a good publication but I was expecting to be given advice about a specific company to invest in NOT be pitched. I feel totally FOOLED

  • Report this Comment On October 23, 2012, at 1:22 PM, Ivyman34 wrote:

    Ditto. Way too much promotion going on unfer tyhe cloak of "content."

  • Report this Comment On October 23, 2012, at 4:53 PM, kahunacfa wrote:

    The perpetual problem with everything Apple is that Steven Jobs was an offensive, controlling half-Arab <Syrian>. All Apple products except the way over-priced Lisa and Apple III are wonderful. The Apple product Premium amounts to 25% to 66 2/3 percent PREMIUM. The Apple "True Believers" <by Eric Hoffer> rush, like lemmings over the cliff in a rush to buy whatever new product is announced.

    For the Apple products I use, an Old 2006 Vintage Mac that does not have the horsepower to run OSX.

    I bought a HUGE position in Apple decembre 1997 je pense @ $10 1/4 per share. The subsequent two-for one split reduced my portfolio cost to $5.125 per share.

    Bonjour,

    Kahuna, CFA

    Venture Capital

    General Partner

    2012 - 2019

    Kailua-Kona 96745

  • Report this Comment On October 24, 2012, at 11:33 AM, 48ozhalfgallons wrote:

    Ipad mini @$329...... naaa.

  • Report this Comment On October 27, 2012, at 8:52 PM, mikecart1 wrote:

    Ipad mini for $329 = The Beginning of the End of Apple as we know it

    Next up is the:

    iPad Mini+

    iPad XL

    iPad SkinnyMini

  • Report this Comment On November 10, 2012, at 4:11 PM, thidmark wrote:

    "The perpetual problem with everything Apple is that Steven Jobs was an offensive, controlling half-Arab <Syrian>"

    This might be the dumbest thing you've ever posted -- and that's saying something.

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