iPad update (HWT)

By R. Kinsey Lowe

Apple is betting that its latest sleek gizmo, the iPad, will convince consumers they need yet another device, one that establishes a new sector that fits somewhere between smartphones and laptops.

"What this device does is extraordinary," Apple CEO Steve Jobs said. "It is the best browsing experience you've ever had...It's unbelievably great...way better than a laptop. Way better than a smartphone."

Skeptics, and there are plenty, contend that it's just an oversize iPod Touch, it's too expensive and that it conspicuously lacks key features, such as a camera or even a USB port, and it won't play the Flash video embedded in many Web sites. So much for a full-fledged browsing experience.

"This is essentially just a really big iPod Touch," groused Forrester Research analyst Charles Golvin, who said he thinks the iPad will mostly cannibalize sales of other Apple products, according to this New York Times story.

More optimistic analysts cite initial skepticism ahead of the iPhone's phenomenal success as evidence that Apple is onto something yet again.

"The target audience is everyone," Michael Gartenberg of market research firm Interpret told the Times. "Apple does not build products for just the enthusiasts. It doesn�t build for the tens of thousands; it builds for the tens of millions."

Interestingly, the Hollywood trades expressed opposing views, with the Hollywood Reporter coming down on the side of skeptics, and Variety - although conceding Apple's tendency toward hyperbole - suggested "Hollywood can't afford to ignore the iPad" because it represents "yet another attractive platform on which they can digitally distribute movies, TV shows, music, games and other content."

The Reporter asserted that any additional revenue from iTunes distribution will remain only "incremental."

Jobs, who hadn't been seen in public since September, took the stage Wednesday morning at Yerba Buena Center for the Arts in San Francisco to a standing ovation.

"We want to kick off 2010 by introducing a truly magical and revolutionary product today," Jobs told the enthusiastic crowd.

With touch-screen navigation and a relatively large, landscape-oriented virtual keyboard, Jobs said, the iPad allows users to surf the Web viewing complete pages instead of the truncated versions on smartphones, and it features a jazzed up email interface. In addition to iTunes, it will come with Apple's new iBooks e-reader store.

Sporting a 9.7-inch LED screen, it's half an inch thick and weighs 1.5 pounds. All the apps that work on iPhone and iPod Touch will work on the iPad, which Jobs also boasted has a 10-hour battery charge. "I can take a flight from SF to Tokyo and watch video the whole way on one charge."

Pricing will start at $499, (half what had been widely predicted) for a Wi-Fi only model with a capacity of 16 gigabytes, rising to $599 (32GB) and $699 (64GB).

For units with Wi-Fi and 3G network capability, prices are $629, $729 and $829 for the corresponding storage.

And, Jobs said, "We will be shipping iPads in 60 days."

Separately, current AT&T; subscribers who are unhappy with the big carrier's 3G service will be unhappy to find out that although Jobs said the iPad will be sold "unlocked," the iPad's 3G modem currently works only on AT&T;'s network, which will make a lot of potential buyers think twice, at least for the more expensive 3G version. It should, however, work on many carriers abroad.

Whatever potential the iPad holds for consumers looking for a more tactile Web experience, its e-reader function will set it apart from notebooks and laptops, and Apple will market it as superior to Amazon's Kindle as well as less established e-readers such as Barnes & Noble's Nook and Sony's Reader.

Apple has already lined up deals with publishers, Jobs said Wednesday, including Hachette, Penguin, HarperCollins, Simon & Schuster and Macmillan. A day earlier McGraw Hill touted itself as being one of the first publishers on board in a CNBC newscast, but it was missing from Apple's presentation. Some tech blog wogs speculated that the omission represented punishment for speaking out of turn before Apple's main event.

The iPad's e-reader capabilities will throw a wrench into Amazon's cut-rate Kindle strategy, the Journal noted in a report posted Tuesday. (subscription required)

Adopting a strategy that is friendlier to publishers, instead of the $9.99 bestseller price Amazon insists upon Apple has asked publishers "to set two e-book price points for hardcover bestsellers: $12.99 and $14.99, with fewer titles offered at $9.99," the Journal said.

Illustrating the iPad's potential as a new way to read newspapers, Jobs pulled up the The New York Times homepage, showing how you can scroll up and down and zoom in and out with your fingers.

He switched to other sites like Time.com and Fandango, among others.

He used "Star Trek" (available on iTunes) to show how you can jump to particular chapters from a movie menu.

He also showed one of his favorite scenes from "Up," a Pixar movie, of course.

Although he didn't mention any studio or network deals, because of Apple's relationship with Disney through Pixar, movies from the studio and TV shows from ABC are a given.

In addition to its HarperCollins unit, News Corp. can be expected to offer the Wall Street Journal and movies and TV shows from Fox, some of which are already available on iTunes.

Same likely goes for other studios who are also vendors through iTunes.

Among several sites offering comprehensive, summarized information, photos, video and pointedly expressed pros/cons are CNET, Gizmodo, Reuters and the Wall Street Journal (subscription required).

Live feeds used to prepare the initial version of this report that was posted Wednesday include those from CNET, CNN's Twitter feed and Gizmodo.

If you would like to view Apple's retail presentation, click here.