The iPad event is now in the rear-view mirror, and the consensus amongst those who study Apple is that it was a disappointment. A new iPad Air was announced and is even thinner – 6.1mm down from 7.5mm – and, predictably, more powerful. The iPad mini 3 gained Touch ID – and with it, the ability to work with Apple Pay – and not much else, with Apple keeping both the iPad mini and iPad mini 2 on sale still.
As a category, the iPad, which has sold over 225 million units since its release in 2010, is now being cannibalised by the iPhone 6 Plus and the MacBook Air, fitting increasingly awkwardly as a middle device between the two.
When Steve Jobs unveiled the iPad, the smartphone landscape was very different; the iPhone 4 had a smaller 3.5-inch display and the MacBook Air was only just becoming a viable laptop, both in terms of battery life and processing power.
Now, the MacBook Air is lighter and much more powerful thanks to Intel's new Haswell processors – it's capable of nine hours of web surfing – while the iPhone 6 Plus heralds a large, full HD display, and has the power to complete tasks previously reserved for the iPad, alongside a two day battery life.
The closure of the gap that the iPad occupied is a big problem for Apple, which has seen sales of the iPad drop off at a rate of 9% year-over-year in the third quarter of 2014. Recently, pundits have called Apple "the iPhone company" which is largely true – the largest product bringing in revenue to Cupertino is the iPhone, and this is worrying. While the iPhone is undoubtedly a high-margin device, having both an iPhone and an iPad in the hands of customers is even higher still.
Some pundits have speculated that falling iPad sales aren't down to consumers being apathetic towards the device, rather that users keep their iPad for longer. Anecdotally, my dad is still using a first-generation iPad for email, movie and light web browsing. Doing a similar thing with a first-generation iPhone (or even the 3G or 3GS) would be a much trickier task. If people truly are waiting to upgrade their iPads over a longer period of time – five years, perhaps, as opposed to two for the iPhone – then Apple still has a problem. But the solution may be simple.
Previously, the iPad has never been about specs. An iPad 2 is still powerful enough to run (some of) the latest apps, browse the web, check email, FaceTime and so on. For people who don't want to run the very latest version of Infinity Blade or score highly on Geekbench, a new iPad isn't essential every time Apple shows it on stage.
For the small minority – those who love taking photos, those who must have a Retina screen, or those who use their iPad for work – this kind of upgrade cycle is essential but they are, as I've said, in the minority. Increasingly, however, the third item on the aforementioned list is becoming a much bigger market.
Pros not cons
Contrary to my previous predictions, the Surface Pro 3 is selling reasonably well (not iPad well, but better than versions one and two of the Surface). Businesses are finally waking up to the benefits of only having to outfit their employees with one device which, in most circumstances, act as two: a laptop and a tablet. The advert for the Surface Pro 3 exemplifies this, showing a young man using the Pro 3 in various scenarios that would require a laptop and a tablet, and this tactic is obviously working.
While the MacBook Air and iPad are good at being a laptop and a tablet respectively, they are still two devices and thus require two power adapters, two carry bags and so on. Apple is working hard to bring the iPad and Mac closer – OS X and iOS now have Hand-Off, which seamlessly, and wirelessly, transfers work from iOS to OS X – but without integrated hardware it is but a token effort.
What I believe Apple needs to do is release an iPad Pro.
Just as Microsoft has done with the Surface Pro – from the original up to number three – Apple can create the iPad Pro as a device that combines the best elements of a laptop – power and keyboard – with the best elements of a tablet – portability, battery life, and touchscreen – into one device. If any company can successfully bring about this device it's Apple, who invented the tablet space back in 2010 and is likely to invent the first commercially successful smartwatch with the Apple Watch.
The Wall Street Journal has reported that Apple is planning on releasing an iPad Pro – or, at the very least, a larger iPad – in late 2014, early 2015, featuring a 12.9-inch screen. Interestingly, separate reports have stated that Apple is thinking about releasing a smaller, lighter and possibly ARM-powered MacBook Air with a 12-inch screen. The overlap of these two (rumoured) devices – especially considering how similar they would be in terms of hardware specs – is incredibly interesting and could create an unusual dynamic amongst Apple's line-up, which has traditionally been very separate as each device plays its own part.
A potential precedent has been set for this introduction by the iPhone 6 Plus, which has a 5.5-inch screen, not much more than a couple of inches away from the screen on the iPad mini. As many pundits have speculated and advised, Apple may be looking to wind the iPad mini down as its sales are cannibalised by the 6 Plus, which is both a phone and a tablet (a combination of two devices, as the iPad Pro would be).
While little is known about the iPad Pro so far, the very fact that the leaks exist is a pointer to Apple's concern for the iPad line and the firm's willingness to diversify it to include new models that will be free from cannibalisation from below (i.e. the iPhone). Of course, the iPad Pro would open the MacBook line up to cannibalisation but the PC industry is largely going to become non-existent – even despite Mac sales reaching new highs – in the next decade according to many research firms, so Apple would be setting itself up to lead the next generation: crossover devices.
Apple is in no rush with the iPad, of course. In the last quarter, over 13 million iPads were sold, but the trend is definitely on a downward slope and the iPad Pro will likely reverse this.