Pricking the Balloon of the IPad Owner

The latest iPad that they just call the "iPad", with no generation number  next to it, saw the strongest launch weekend of any iPad yet - they sold 3 million in one weekend. Apple, according to most industry reports, carries home about half the $499 it charges you for the unit. The rest of it, is what it costs Apple to make it.

But that's only if you choose for $499 model. If you choose one of the more expensive models, Apple's take-home is even bigger. You see - it doesn't cost Apple anything more to make the more expensive models - just $15 or so. But they charge you an extra hundred dollars for it. On the other hand, for each Kindle Fire that Amazon sells, it loses a few dollars. In a business where manufacturers work on razor thin profit margins, Apple certainly lives in its own universe.

You mustn't be too unhappy with Apple. As generous as those margins are, they are a lot slimmer than they used to be. You have read about how workers on Apple's assembly lines in China are paid more these days, haven't you? That has to come out of Apple's margins.

The problem with coveting the iPad (the latest version always) is that it's cool only stays for a short period of time. When the new model comes out, you might as well be holding an actual tablet for all that it does for your reputation. You really should look at the cartoon on the website The Oatmeal about iPad product cool cycles.

You're telling yourself that it's not for no reason that the old models become less chool - it's because the new models are way, way better, right?

Not exactly. There've been tests done by consumer magazines. When they give Apple fans who haven't seen the new superhigh resolution iPad yet an old iPad 2 and they tell them  that it's the new iPad they've been waiting for, they right away seem to believe they are looking at a high-res screen. In other tests, testers would camouflage an old iPad and a new iPad so that only the screens were visible. Even then, Apple fans consistently picked the wrong one.

What this tells you is that you shouldn't really go for the latest and greatest. Just buy a generation older. It'll save you money, and it'll be just as good. It may not be cool, but who's going to know? It's all in your head.

When people rave about the iPad, when they say that it's so much better than any kind of computing device ever, it's easy to forget how underpowered the iPad is. Really, you could get a laptop that was 10 times more powerful and capacious and capable, for $100 less. The iPad is great for certain things. It's great for doctors, airline pilots, and so on. It's a great way to consume data. It isn't great when you actually want to create something. For instance, how do you create anything without a keyboard?