Apple’s long had a reputation for high prices, and certainly there have been times and product lines where that’s very true. But there are a lot of places where Apple’s prices are actually quite competitive, especially where they have a huge lead in market share.
Everybody and their brother have been gearing up for the last year to launch their “iPad-killers”; so far Apple’s iPad is pretty much the only tablet-factor computer to ever sell well in the mass market (despite — or perhaps in part because of — the iOS platform’s many odd limitations). The only one to actually reach market yet with a tablet-optimized operating system is Motorola’s Xoom which recently launched running Android 3.0 “Honeycomb”; tech specs of this and another upcoming tablets are pretty similar to Apple’s just-announced iPad 2, available March 11 at the same pricing as last year’s models.
There’s been much hoopla about price, with no high-end competitor yet coming close to Apple’s entry-level pricing. The lowest-end iPad rocks in at $499, just under the $500 “wow that’s closer to $1000 than to free!” price point.
The Xoom so far has only a single 3G+Wifi-capable model, which retails for $799 standalone. This actually isn’t insanely awful — Apple’s 3G+Wifi models can run up to $729 or $829 with larger built-in storage, while the Xoom can have storage added with an SD card, so the gap is less than that initially visible $300 if you’re going for the beefier models.
Verizon also offers a $200 subsidy for a 2-year contract, making pricing more comparable to the unsubsidized $629 base 3G+Wifi iPad. But… let’s be honest, we all have phones with 3G or 4G data plans already. Do we really need to shell out for another cellular radio and another data plan?
Which tablet will actually cost you more will depend on which one you buy and on which data plan you get, if any. For those of us who want to pass on paying for a third (or fourth …) Internet connection every month when we can already use our phones as a wifi hotspot, any data plan is a huge expense, and subsidized pricing doesn’t make up for it:
- iPad 2 Wifi-only: $499
- Xoom 3G+Wifi w/ 2 years contracted data plan (sticker price only): $599 (pay extra $100, but you really pay more…)
- iPad 2 3G+Wifi w/o data plan: $629 (pay extra $130)
- Xoom 3G+Wifi w/o data plan: $799 (pay extra $300… but Best Buy ads say you actually need to buy a month of service to activate it…)
- iPad 2 3G+Wifi w/ 2 years month-by-month $15/mo data plan: $989-$1229 depending on taxes/fees? (pay extra $400-$600):
- Xoom 3G+Wifi w/ 2 years contracted $20/mo data plan: $1080-$1300 depending on taxes/fees? (pay extra $500-$700; plus another $350 if you terminate contract early)
Bigger badder data plans will let either brand leapfrog the other in price, depending on where you pick em… The cheapest thing is to buy a Wifi-only iPad and donate a few hundred bucks to your favorite Free Software-related charity. :P
The most important thing to remember is that for devices that incur a monthly data plan fee, the costs of the data plan can dwarf the original purchase price. This is why so many phones are insanely cheap or “free” — carriers have spent years playing an arms race to the bottom on your initial buy-in price to make way, way more money from you in the long term.
Update 2010-03-21: Motorola has announced a wifi-only Xoom model at $599; still above the iPad 2 entry price point but MUCH cheaper than getting anything with a data plan. I’ve placed a pre-order and hope to be trying it out by the end of the month!
Buy the iPad 2!