Oppenheimer analyst Yair Reiner says a check of the Apple supply chain reveals specifics about the Apple tablet PC ramping up for production, with the computing giant wooing large publishers and offering them a much more favorable revenue split than Amazon is currently imposing.
The iPad -- our naming, not Apple's -- will basically be an iPhone on steroids, featuring a 10.1-inch multi-touch display using LTPS LCD technology. A release could happen as soon as March, as Apple needs to ramp up production to support the same of 1M units monthly and should begin in February. There had been reports that the iPad will sport a OLED display, but Reiner says this isn't in the works at the current time. The retail price is expected to be around $1,000.
Rainer made his report to Apple investors in a note released today.
Most industry observers see the release of an Apple tablet as inevitable, and there certainly will be a lot of conjecture as to exactly what it will be before Apple pulls the trigger on a release.
But there's one part of Reiner's report that we found fascinating, paralleling what we've been hearing from friends at the larger publishing houses: Apple is seriously wooing content providers.
This is somewhat unusual: Apple tends not to woo folks, as many in the music industry have discovered. But someone smart at Apple figured out the world of publishing isn't the same as the music world, and so the computing giant has set out to establish relationships with the big publishing houses.
To that end, Apple is dangling some pretty decent revenue shares: a 30/70 revenue split on a nonexclusive basis. This is better than what Amazon offers: 65/35 split for small publishers, 50/50 split to big publishers on a nonexclusive basis, and 30/70 on an exclusive basis -- though that elusive 30/70 split just doesn't happen very often. Publishers could set up their own online stores or work with Apple on a setup similar to iTunes storefronts. Or both.
Will consumers spend $1,000 on a book-reader device? No, we don't think so, either. The dedicated book readers from Apple and Sony are building up their own unique audiences and market niches. But as a welcome addition to the content world, the Apple tablet is a exciting development: it will allow the book to move past a static text document and offer a much more rich experience.
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