Apple iPad Price Still a Concern

With a week to wait until the iPad’s much-hyped arrival, a major question on analysts’ lips is, Who will buy Apple’s newest darling?
According to a March 26 report from NPD Group, the most likely iPad buyers are current Apple product owners and 18- to 34-year-olds.
The lure for the first group, said the report, lies in the Apple name, with 37 percent of those surveyed citing “liking the Apple brand” as a top reason for their interest in the iPad.
The iPad’s multitouch screen garnered an equal percentage of interest from the 18- to 34-year-olds, a group NPD said is most likely to use the iPad for accessing the Internet and listening to music.
“Considering what people are planning to use the iPad for, it’s not hard to understand why people who have these capabilities on other devices, such as the iPod Touch or a notebook [or] netbook, may not want to spend $500 or more on a similar device,” NPD analyst Stephen Baker said in a statement.
“This points to the need for Apple to close the content deals that focus the iPad on what is likely to be its best long-range value proposition around high-quality media consumption,” Baker went on, alluding to the publishing contracts that Apple is said to be still working to secure. Conde Nast and the Associated Press, however, have already committed to creating content for the iPad.
Apple recently began offering iPhones without an AT&T contract and hence unsubsidized by the carrier. The unsubsidized smartphones’ pricing, which ranges from $499 to $699, may be enough to temporarily prevent one from flinching at the iPad’s price range of $499 to $829.
Or not. NPD found pricing, even among Apple product owners, to be a major issue, with 43 percent of respondents saying they found the iPad too expensive. Among 18- to 34-year-olds, 57 percent cited price as the No. 1 reason they weren’t ready to head to the Apple store April 3-or any time soon.
Indeed, when asked how likely they were to purchase an iPad over the next six months, only 9 percent of all consumers NPD surveyed said they were “extremely or very likely” to. Only 10 percent of 18- to 34-year-olds and 9 percent of Apple product owners said the same.
Conversely, 66 percent of consumers didn’t see one in their future, and neither did 60 percent of Apple product owners.
In a March 22 report, ComScore gave Apple slightly better odds, finding that 15 percent of respondents intended to buy an iPad over the next three months.
Additionally, Broadpoint AmTech analyst Brian Marshall wrote in a March 9 research note that getting two hands on the iPad may be enough to change some minds.
“We note the vast majority of the naysayers have not yet had the opportunity to use the iPad on a firsthand basis … We were hooked after the first 15 minutes of use,” Marshall wrote.
He went on to predict that, should the iPad “live up to its potential,” Apple could ship nearly 7 million iPads before the year’s end.