Yet another Apple windfall - iPad covers

Stat of the day: around 30% of Apple's iPad profit comes from selling smart covers.

Richard Kramer, managing partner of London-based Arete Research, calls it the 'after hardware' market - making money from accessories.

The covers "cost $5 to make, and Apple sells them for $39."

"They sell 15m iPad units, 90% are smart cover-attached, that's $450-$500 million in profit they made for selling accessories for a device."

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With iPad 2, Apple disappears over the horizon

With more than 90% of the market, Apple has been streeting the tablet field. With the early release of iPad 2 it’s disappeared over the horizon.

A price war seems inevitable. Even the iPad 2 – which starts at $499 - is priced below Motorola’s Xoom, but the heavy blood-letting will be among the lower orders. As WSJ reported a couple of days ago:

By the end of 2010 there were already 30 different tablets for sale, according to research company PRTM. The company now counts 102 tablets from 64 different makers that are either available now or in development.

Another Journal story points out that Apple keeps its costs down by pre-paying for components and buying manufacturing capacity, as well as the fact that a third of its sales are through its own retail outlets.

Meanwhile, Microsoft’s declaration that it will be ready for the tablet wars some time in 2012 says something about how far ahead Apple is. Though it also tells us much more about how far Microsoft has fallen behind.



The age of the smartphone

Yesterday I mentioned the arrival of the sub-$100 Android smartphone as just one more headache for Nokia.

Taiwan and mainland Chinese design houses are offering turnkey chip and OS solutions to OEMs at $100 and less, promising to jump-start demand for Web-friendly Android-based devices in developing markets, where Nokia now sells most of its phones.

Now Apple’s getting in on the act. Bloomberg reports that a smaller, low-cost version of the iPhone is in production inside the Cupertino hit machine. Apple is aiming to get the device – which would sell for around $200 – to the market by the mid-year.

The Bloomberg story also confirms GigaOm’s scoop three months ago that Apple is planning its own universal SIM card that would enable consumers to enjoy access to multiple mobile operators via iTunes. That’s a huge development for the mobile industry – will post more on that later.

It just remains to be pointed out that the age of the mass market smartphone is here; consumers actually bought more smartphones than PCs in the last quarter of 2010.

We’ll hear a lot more about low-cost smartphones at the annual mobile industry confab in Barcelona next week.