Is iPad 2 a Transitional Step?

21 Feb

Apple has announced the successor of its nascent tablet PC product- the iPad2.  To everyone’s surprise that Steve Jobs showed up for the introduction event.  While spirited, he did look thinner than his last public appearance and waited no time to emphasize that Apple sold 15 millions of iPad for over US$9 billions in sales in the year of 2010.

Second surprise of the day is the availability of the new product.  Customers in North American market will be able to get the iPad2 starting from March 11.  The product will also be on sales in 26 other countries from March 25 and on.

Judging from the dates, we can infer that no major re-design was done and new design has been finalized for some time.  The prototype of the new product must have been there before the end of 2010.  The assembly kits were gathered in ShenZhen earlier this year for the final assemblies before the global product launch event.

According to some sources, the production rate of iPad 2 stands at one million units per month.  Sufficient units will come out for the initial demands.  Apple usually lets the stock run out before it makes its efforts to replenish the inventory.  Customer frenzy worked great in stimulating the demands of iSomething products as we have seen in the past.  The objective is to sell 30 to 40 millions of the product before the end of the year.

Product Specification

The major improvement comes from the adoption of Apple A5 processor (from Samsung foundry).  It’s a customized ARM-based dual- core processor with a speed of 1.08GHz.  The improvement in multitasking is apparent over what A4 processor can deliver before.  However, the 3D acceleration chip, PowerVR SGX543MP (dual to quad-core models) doesn’t stand out when compared to nVidia’s Tegra 2 performing in a competing Android tablet in the market in its 3-D processing capability and texture fill rate.  One benefit of the new graphic chip that is worth mentioning is the output of 1080p HD video.  An external $39 HDMI cable will make the connection for the video signals.

The Tegra 2 processor comes out from a more advanced 40nm CMOS process from TSMC than the one for A5 from Samsung.  However, Tegra 2 consumes more power than A5 due to the architectural design of the chip.

Other specification highlights include 512MB of DRAM capacity and 16/32/64GB of NAND Flash storages.  The resolution of the 9.7-inch display panel is 1024×768, which is a little bit shy than the 1280×800 resolution of 10.1-inch display of Moptorola’s Xoom.  We think Apple chose not to use the Retina display, same as  in iPhone 4, due to the cost consideration.  Display alone, Apple saved 50% from the $130 Xoom has.  It’s unknown if Apple will maintain the choice when it comes to iPad 2 4G or iPad 3.

As expected, the new iPad 2 slimmed down to 0.88cm in thickness and 601gram (wi-fi version) and 613 gram (wi-fi+3G version) in weight. The front camera makes video conferencing with iPad 2 a possibility. The new iOS 4.3 is nice to have.  The 720p video recording, editing and playing software, iMove, is a big plus.  This tool will help regular users with the production of personal video clips.

iPad2 continues to support GSM, CDMA and wi-fi communication protocols.  LTE 4G was not enclosed for its power consumption, as Apple claims.  We think it can be design and cost considerations as well.  Xoom has built the hardware feature in and has the option to turn on the capability by firmware upgrades at a later time.

The smart cover was definitely an Apple kind of surprise.  It is a great idea and reminds us of the bath tub cover commonly seen in Japan.  It uses magnetic forces to stick itself and stay on iPad2.  The cover is available for $39 plastic and $69 leather version.

SmartMobix considers this iPad 2 as a transition product with incremental improvements.  Other than the processor, there is no major revisions on the hardware.  The Adroid tablet PCs that will be released in first half of 2011 will be more competitive hardware wise even though iPad 2 gets some help from its software and available applications.

Every time we go to a product announcement, we expect Apple to show a new product that leaps forward from the competing crowd.  Based on this, we classified iPad 2 as a transitional and interim product introduction.  The real next generation iPad product will come by the end of 2011 or even later.  We expect to be pleasantly surprised then as we were previously.

The front camera, slimmer dimension and white outfit are what Apple fans desire. However, whether the incremental improvements are sufficient to entice the current iPad users to replace their existing devices is for time to tell.

The original iPad is being discounted on the face of the new iPad 2 introduction.  For example, the 16GB version of iPad can now be bought for $400, versus the original price of $499.  It is a good deal when you compare with the other tablet PCs.

The $729 price tag of a iPad 2 is lower than the $799 price of an equivalent Xoom tablet.  Is this Apple’s strategy to fight with the on-coming and proliferating Android tablets in this year of too many tablets?  Will other tablet PC manufacturers follow suit and start the pricing war on tablet PCs?  We will leave it for the market to tell us.

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