For the past four years, you might have regarded the iPad as a gadget whose time had come and gone. After several years of amazing growth, sales didn’t just flatten, they fell. Every single quarter, sales were lower than the previous year’s quarter.
But Apple persevered, and during quarterly calls with financial analysts, where Apple talks about its revenue and prospects, Tim Cook would restate his optimism about the product. But I joined others in regarding it us just corporate spin. Cook was merely trying to deal with a bad result, although you must admire Apple’s perseverance.
At least iPads continued to generate high profits, and the tablets stayed ahead of the pack. Compare that to Microsoft, which has allowed new products and corporate divisions to sustain huge buckets of red ink for years, hoping that things will turn around.
So even in the dark days, the iPad made plenty of money. No wonder Apple kept it going, and it does seem that the optimism is beginning to pay off.
I suspect things began to turn around for the iPad with the introduction of the 12.9-inch iPad Pro in 2015; it was clearly designed for productivity. The Apple Pencil accessory was clearly designed to ease the process of drawing on screen, but the combo, along with a 9.7-inch iPad Pro, failed to boost sales. Or maybe they kept sales from dropping further.
Now one of the reasons given for the iPad’s falling sales was a longer-than-expected refresh cycle. While people will routinely replace a smartphone in two or three years, there wasn’t much of a compelling reason to replace a much older iPad. Sure, the newer model may be thinner, lighter, faster, but what it does is mostly the same. Well, at least until the iOS leaves it behind.
So what did Apple do in 2017 to end the iPad sales drop? Was it all about promotion, compelling new models, or maybe — pricing?
Earlier this year, amid expectations that a 10.5-inch iPad Pro was in the works, Apple quietly released a refreshed model, based on the 9.7-inch iPad Air. It had an A9 processor and other enhancements, giving it pretty decent benchmarks. It also strayed far from the usual price structure, starting at $329 for the 32GB model. Suddenly, millions of users of older iPads had a relatively inexpensive way to upgrade to something with most of the latest technologies. You can list what it didn’t have, but for most people it probably didn’t matter.
At the WWDC in June, two new iPad Pros arrived, including that mythical 10.5-inch version. The demonstration of iOS 11, now available as a beta for developers and public beta testers, offers more multitasking features and a Files app that provides Finder-like functions. So it appears that Apple has used the Mac as the inspiration to make the iPad a more productive tool.
Very important, also, is how the new mainstream iPad evidently influenced the average retail price. So it went down from $490 to $435 in the June quarter, no doubt the impact of the cheaper model. It meant that total revenue was up just 2%, whereas unit sales rose 15%.
Does that signal a trend towards the cheaper iPad, or just the result of the delayed replacement cycle? Since the new iPad Pros only arrived in mid-June, it may take another quarter or two to judge their impact on sales and average prices. But it stands to reason that, if people love their iPads, eventually they’ll want to buy new ones.
The iPad Pros are certainly oriented more towards people who want to use them for productivity. Despite the superior display, watching a Netflix video will be just fine on the regular iPad.
If the replacement cycle is finally here, it does mean that, each year, more people will want to buy new iPads, reflecting the rapid sales run-up for the first three years. But don’t forget that average retail prices actually didn’t change all that much from the previous quarter. It was more significant only if you compared it to last year.
So I suppose we’ll see.
As for me, I’m still far from ready to use Mrs. Steinberg’s iPad for much, except to help her solve a problem or to run an OS upgrade. I can certainly see intriguing possibilities for the sort of work I do, recording weekly radio shows and writing.
At present, there is no way to record The Paracast and The Tech Night Owl LIVE on an iPad. There is no iOS app that will even partly duplicate the features of Rogue Amoeba’s Audio Hijack for macOS, which allows you to capture the audio streams from a number of sources and mix them into a single file. Or separate files.
So in my case, it’s a Skype connection for guests, and an outboard mic mixer in my home studio. If all my guests were here, I could probably find a way to pipe that audio into the iPad and use GarageBand or another audio app. But if an when Apple allows an app such as Audio Hijack to run on an iPad, I foresee fascinating possibilities, especially when it comes to remote recording sessions.
Apple has made some positive moves to advance the iPad platform. Customers are responding, so let’s see where it goes next.