$499 for Apple’s iPad: Bargain or Deception?


With analysts and pundits alike estimating that the rumored Apple tablet would fall in the stratospheric $800 to $1,000 price range prior to launch, the $499 figure Apple slapped on screen at the unveiling certainly dropped some jaws. In fact, it looked downright reasonable for Apple. But as we learned when Apple sketched out the details, that’s only for the humble 16GB version with no 3G.

The real table of prices gets quite a bit more complicated. And expensive. Opting for 3G alone will add $129 to the price, while stepping up to 32GB will add $100, and to 64GB, another $100 still. The total price for a 64GB Apple iPad tablet with 3G: $829.

Looks like Apple learned a thing or two from Microsoft’s Xbox 360 strategy: namely, throwing out a low base price for a product nobody wants, and price gouging all the way to the bank for the features they’ll really need. Without 3G, the iPad’s portability doesn’t seem all that compelling. And charging $100 for 16GB of extra memory is downright egregious when you can buy a 16GB thumb drive for around $30.

AT&T seems to have followed the same pricing scheme on its “new” data plans: Offer the same high price for the useful version, then a deeply discounted version too severely crippled to be of any use to most people. Despite all the hyperbole from Apple over the amazing deals it has ironed out, $30 for unlimited data is exactly what existing iPhone users are already paying. Sorry, no discounts or tethering options, either, so iPhone addicts will need to shell out double for two plans. Too much? AT&T will offer a measly 250MB of data monthly for $15. So much for high-def YouTube videos, or doing much out-of-house browsing.

Apple iPad Wireless

Compare the Apple iPad to the devices it purportedly competes with. As an e-reader, even the bottom-of-the-barrel Apple iPad stacks poorly beside the $489 Amazon Kindle DX, which costs almost the same but comes with free lifetime 3G access. As a netbook replacement, the 64GB 3G iPad for $829 still looks steep beside a netbook like the Dell Mini 10v, which you can with equip for AT&T broadband for $404 (and with a 120GB hard drive to boot). Even the Wi-Fi-only Archos 9 tablet, possibly the closest analogy to the iPad, goes for $549 and includes 60GB of memory. That makes it $150 cheaper than the 64GB Apple iPad, and it runs a full desktop operating system. None of these truly makes an apples-to-apple comparison for the unique iPad (pardon the pun), but it’s clear to us that the iPad is no exception to the Apple Tax.

The buzz over the iPad has demonstrated that consumers have room in their hearts and briefcases for a device between a smartphone and a laptop. But do they have room in their wallets?