Apple shares have risen about 1 per cent on analyst predictions that the surprisingly low price of the iPad will lead to “millions” of sales.
Apple’s chief executive Steve Jobs launched the multipurpose device at a company event in San Francisco early this morning Australian time.
The initial price will be $US499 [$557] for the base 16-gigabyte version capable of displaying e-books, web content, movies and more.
Analysts say the price and functionality sits the product somewhere between an iPhone and Apple’s Mac laptop computers.
“The price is a gigantic win. The non-3G model at $US499 is very surprising,” Michael Yoshikami, an analyst with YCMNet Advisors told Bloomberg.
Brian Marshall, an analyst at Broadpoint Amtech, says that the iPad’s advantage will be its higher multi-functionality than many other e-book readers, such as Amazon’s Kindle.
“Pricing is very aggressive, so it’s pretty positive from a mass adoption perspective. It was about $US200 lower than what I was expecting,” he said.
“I think [Kindle is] going to have a tough road ahead. There is a lot of functionality, it’s just a better design for a similar price point.
“I don’t understand why anyone would want to buy a Kindle when they have an opportunity to buy an iPad for a similar price point.”
Investors seemed to largely agree, with Apple shares edging $US1.94 higher to $US207.88.
However, not all analysts are convinced that the iPad will make anything like the social impact and financial return of products such as the iPod and iPhone.
“It’s tough for me to figure out who needs this device because most people are doing everything it does on the iPhone. Maybe there’s a whole bunch of people who need a bigger iPhone with a keyboard, but I’d be surprised,” said Seth Jayson, the senior technology analyst at Motley Fool.
“So far nothing here has been surprising. It’s almost like a Microsoft presentation. We knew everything before its came out, which is unusual for Apple.
“I think this would be a tough sell in the current economy. iPhone does almost everything but fits into a pocket and most people have laptops. They are really competing against themselves.”
Apple also faces a legal headache over the iPad name, with computing company Fujitsu already having made a trademark application for the name.
“They probably need to talk to us and we haven’t had any direct communications with Apple,” a lawyer for Fujitsu, Edward Pennington, told Bloomberg.
“Apple filed extensions to oppose it [the Fujitsu trademark application] and now it makes sense. Now we can see why they did.”
Mr Pennington says that Apple’s position is “a little awkward”, but that the company may argue that there would be no confusion between its iPad and Fujitsu’s device that is used in grocery stores at self-service checkouts.