Report: Apple exploring a cheaper iPad

With a 73.4% market share by Gartner's count, the iPad is the undisputed king of the tablet market right now... but its lead might shrink awfully fast with Amazon's $199 Kindle Fire in the mix. That might be why, according to an analyst quoted by AppleInsider, Apple is quietly drawing up plans for a substantially cheaper iPad.

Reportedly, Ticonderoga Securities analyst Brian White caught wind of the "iPad mini" after speaking to hardware suppliers in China. While he expects the cheaper device to be priced "in the mid-to-high-$200 range," he doesn't believe it will necessarily have a smaller form factor. That gives the speculation a lot more weight: Steve Jobs stated last year, "The reason we [won't] make a 7-inch tablet isn't because we don't want to hit that price point, it's because we think the screen is too small to express the software."

AppleInsider goes on to say White believes the cheaper iPad could be out in the "first few months" of 2012, followed by a "much more powerful, feature rich standard-priced iPad 3" in the second quarter.

Back in March, iSuppli pegged the bill-of-materials cost of the iPad 2 at $326. The display alone was said to cost around $127, with the 16GB of flash memory and 512MB of mobile DDR2 making up a combined $65.70—the next most expensive set of components. Memory has admittedly gotten cheaper since then, but it seems doubtful Apple could offer a sub-$300, 10" iPad and still turn a profit. Of course, iSuppli also worked out that the Kindle Fire's total production cost is almost $10 more than its retail price. The research firm believes Amazon is selling the device so cheap in order to draw customers to its retail business.

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