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With 2012 in the rearview mirror, what will Apple's (NASDAQ: AAPL ) 2013 product road map look like? Piper Jaffray analyst Gene Munster offered up his predictions a couple months ago, but now we have another analyst chiming in with some pipeline predictions.
KGI Securities analyst Ming-Chi Kuo is a man worth paying attention to when it comes to Apple speculation, since Kuo has had remarkable accuracy with recent calls on product launches. Kuo predicted that Apple would axe its 17-inch MacBook Pro, launch MacBook Pros with Retina displays alongside existing models to create a third family, and that the 13-inch models of that lineup would be released last October. Months before the iPhone 5 was unveiled, the analyst also said that Apple would utilize in-cell display technology to make the device so thin.
That's why Kuo's predictions should carry more weight than some others. What does Kuo's crystal ball forecast for Apple this year?
In line with other analyst predictions, Kuo believes Apple will introduce an iPhone 5S this summer along with a lower-cost iPhone 5 with a new design. He doesn't see plans for the company to introduce a larger iPhone to take advantage of the growing phablet trend that Samsung is riding.
The lower-cost iPhone 5 should carry a plastic body and come in different colors. The flagship iPhone 5S may feature a built-in fingerprint sensor utilizing the AuthenTec acquisition from last year along with a better camera and A7 processor. Apple didn't make any major upgrades to the image sensor with the iPhone 5. It went with an 8-megapixel backside-illuminated sensor from Sony for the second year in a row, but a slightly different one.
Kuo differs from other analysts on when he thinks new iPads will be released. There's been some talk that Apple may release new iPads in March, but Kuo thinks they'll have to wait until the third quarter. The timing of the iPad product cycle is highly uncertain right now, since it broke its Spring tradition by releasing the fourth-generation iPad and iPad Mini just a few months ago.
The iPad Mini may be blessed with a Retina Display with the same resolution as the larger version. That would be despite the technical, strategic, and cost challenges that Apple faces with such a device. The fifth-generation full-sized model may get a redesign featuring a thinner bezel similar to the iPad Mini.
The analyst also predicts that Apple will kill off the non-Retina MacBook Pro in favor of the Retina models, but that the Mac maker will also reduce prices in order to drive sales. That would be a necessary move since the Retina models currently carry premiums of $400 to $500 that may be hard for some consumers to stomach.
MacBook Airs will have to wait on Retina displays due to technical limitations of including them. Instead, they'll just get incremental spec bumps inside.
Investors continue to anxiously await the day that Apple unveils its full-blown TV set, but Kuo doesn't think this is in the cards for 2013. Instead, Apple will likely update the current set-top box offering early in the year and the TV set will have to wait until 2014.
All Macs will inevitably be upgraded to Intel's newest Haswell processors, which are due out this spring. The biggest performance gains for Haswell chips will be on the integrated graphics front, which will bode particularly well for Macs with Retina displays.
Apple just redesigned a wide range of product families in 2012, which is one reason why it's predicting a gross margin decline in the fourth quarter. That means that most of its product families won't see dramatic redesigns this year. Perhaps more importantly, as Apple works down the manufacturing cost curves of these redesigned products, its gross margins should move higher. Hopefully they bottomed out last quarter (if they're not bottoming out this quarter).
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