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back to article Samsung admits iPad 2 will be tough to beat

A Samsung executive has admitted that beating the iPad 2's skinniness will be a challenge. The new Apple fondleslab, priced to match the first-gen model, will also force the South Korean giant to rethink its pricing policy, Lee Don-joo, an executive VP at Samsung's mobile division told local news agency Yonhap. "Apple made it …

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Anonymous Coward

Samsung prices are foolish

The pricing on the Galaxy tab always seemed foolish to me, I didn't even look at its specs.

These companies that are in the business of making phones seem to be addicted to overpricing the hardware and then getting the consumer to buy it with a phone contract to "fix" the price problem.

Viewsonic had the right idea pricing the gTablet at $400 USD, just unfortunate about the OS/UI layer they shipped with it.

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Coat

Viewsonic

the g-Tablet has a community with custom firmware to return it to a (very) usable vanilla Android. It even runs smooth too. Was eyeballing the g-Tablet over an Archos 101 since Archos hasn't quite jumped on the Tegra2 yet.

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Bronze badge

advent vega?

how can the advent vega be sold for £250? its got dual core. its got a decent amount of memory, its a capacitive screen. and its a damn site cheaper than anything anyone else is doing. whats going on?

its also made by dixons of all people.......

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Thumb Up

and it's great

i've got one, not perfect but bloody great for web surfing (with flash) email, films etc. not as fluid as the ipad but for £249, just get one, mod it (modaco.com) and enjoy....

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Anonymous Coward

Good question

I think the answer is that the bigger manufacturers need bigger profits to pay for all the staff; it also costs them more to design and get out of the door because they have a lot of meetings an they don't run themselves you know.

Not just the Advent - also the Archos range.

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Gold badge

Simples

Cost cutting. It's cheapo plastic, it has a cheaper screen (not IPS that's for sure), cheapest camera. Probably won't matter to the sort of people who buy £250 worth of tablet but some people want to view photos on a tablet with fairly decent colour reproduction.

Also some people want official firmware from the company who designed it, they want to plug it in and have the update done with no fuss.

Like anything you can build up a device with the lowest price parts and it will still do the job. I build and ride bicycles as a hobby and I'm sure I could build a very cheap one that would roll along, change gears and stop when the brakes are applied. But it would be lacking in performance and reliability, plus spare parts or technical support would be impossible to find.

You could say why buy a £1500 carbon road bike when you can get a bike from Halfords for £80. If you don't know why someone spends more than you probably don't know much about what people look for in one. I'll give you a clue, less hassle making it work!

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Headmaster

Economic theory

>bigger manufacturers need bigger profits to pay for all the staff;

>costs them more ... a lot of meetings

Aye. Whatever happened to the "Economies of scale" theory?

Oh yes, it got replaced by "inverted pyramid" management practices.

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Re: Simples

"If you don't know why someone spends more than you probably don't know much about what people look for in one. I'll give you a clue, less hassle making it work!"

Absolute rollocks. There are, of course, always a few people that actually need and/or appreciate the more expensive product. However, the vast majority of people are buying the expensive one for a myriad of reasons that all come down to marketing.

They are buying it because their friends have one, their boss has one, an advert told them it had a "retina display" so it MUST be good, they saw one in a film being used by their favourite celeb etc etc etc.

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Anonymous Coward

Simples

The reason everyone i know who has bought either an iPad or any other Apple gear is simply that's its well priced (if you compare like with like & not a MacBook with a Netbook for instance), Apples support is top notch & the stuff just works as advertised. No need to be a fanboy, just common sense.

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Anonymous Coward

Yep!

That's quite right and it's exactly the same reason you don't buy one.

Live with it, it's called being human. And it's that same being human that makes you dismiss everyone that wants that experience to be stupid and or Naive.

what do you drive by the way? Was it the absolute cheapest in the market? Thought not.

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Stop

but what about those media suscriptions

Do you like paying 42% higher prices for media subscriptions?

Or, not having the app to subscribe at all?

"There is an app for that" is now "Apple precludes an app for that".

Interested in an Apple device? Not in the least. I do not partronize those hell bent upon illegal business practices.

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RE: cutting costs

At least Dixons sell their tab cheap. Unlike Samsung whom also use cheap plastics and cheap cameras. But ask premium prices for it. The Galaxy S is marginally cheaper than an iPhone yet Samsung still hasn't realised that at such prices customers demand premium materials as well as high-tech. No wonder why Apple does it so well.

--> "perhaps, that the Android 2.2 tablet isn't as popular with punters as Samsung hoped it would be."

What do you expect. Ridiculous asking price for a crappy chinese product (made by a cheap Korean company). I sometimes wonder... have these chinese and koreans ever hold an iPad in their hands?

It seems that only HTC seem to get it. Or at least giving it a shot with their unibody-designs. Just look at SE's Experia X10 or X12 (Arc), or the LG Optimus 2x. Damn expensive for cheap plastic phones. Hell, even my cheap old acer neotouch S200 has a METAL rim around the screen!

Wake up guys. The ipad 2 will indeed be a hard nut to crack (no pun intended) unless you start to use premium materials too. Otherwise do as Dixons. Buy cheap, sell cheap.

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Anonymous Coward

RE: what do you drive by the way?

Don't forget that cars are status symbols too. In capitalistic ventures the size and statue of the car decides how "succesfull" one is (Or how large his dick is).

Same is happening with other mechandise (though less obvious).

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FAIL

hmmm

blood on the tracks....already

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Hmm...

Either they drop the prices or they raise them... The iPad is now among the cheaper tablets which means there must be room above it. With the right marketing you could sell a Samsung (or Motorola) tablet as a "more fully featured tablet" for a higher price now.

That's probably not what all the Android lovers will like to see, though.

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Silver badge

Higher pricing

Will be very hard.

Neither Samsung or Motorola are especially highly-valued brand names. In Samsung's case this is a little unfair as they've been knocking out top-notch stuff for some time now. But trying to sell a product more expensive than Apple without the brand cachet is going to be a tricky job even if it is a more powerful tablet. The best way they could achieve it, is to do a Lexus and come up with an entirely new brand which espouses luxury and an unrivalled experience. It'd be a Samsung or Motorola underneath, but those names wouldn't appear anywhere on it.

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or media subscriptions are available for less

Signing up for a media subscription should be about 42% more expensive from Apple.

Do you really want to pay a significantly higher price for the same subscription?

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Anonymous Coward

Apple's advantage

They can have lower margins one their I-Devices thanks to the 30% take of the app store and iTunes. Unfortunately, none of the Motorola's, Samsungs, or HTCs can do this, short of having their own Android Market.

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Anonymous Coward

Not really

You seem to forget that Apple had to develop it's own OS, browser, SDK and everything that makes the hardware tick. This costs a lot of money which HTC, Samsung etc didn't have to pay Google for.

Apple announced that they paid $2billion to developers so far, so their cut has been around $850 million since 2008 before tax, fees (like cc handling) and generally running the app store. It's not really that much if you look at other big software projects, surely not enough to act as an hardware subsidy.

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Not really

the app store only cleared a few percent in profit. it;s income is almost entirely spent in staff, hosting, bandwidth, and more.

the Ipad however does rake in about $200 in profit per unit. unlike Samsung and moto, who sunk millions into development of the tablet, let alone OS customizations, marketing, etc, with zero fallback, in less than a year, and after throwing out several predecessors targeted at Apple's expected $1K iPad 1 pricetag, they have no wiggle room. Apple on the other hand simply leveraged existing iOS, and took 5+ years of slow effort to design their tablet, and a minor revision of it, not to mention spreading that cost over 15m units, not Samsung's 1.5m or moto's few hundred thousand (of which Google gave thousands away free).

Apple has amazing manufacturing effectiveness, low R&D cost, and economy of scale giving them great price leverage at wholesale. they'll accelerate that with their $3.7 investment to get cheap screens in mass later this near no one else will have access to at all, and when they do, make a profit on every one Samsung or moto later include...

Apple made 1 sinle move that guaranteed them this market for a long time. they completely broke tradition, and all expectations with $499. NO ONE expected that. A tablet with iOS, newer better parts, and costing $100 LESS than the base cost of the iPhone 3GS off contract? no one even guessed that was possible... Apple did it, and it worked, and no no one competes, they had almost a whole year unopposed while the competiti0n now has to trow loss leaders at them just to chip away...

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nope

Apple developed that for the phone and iPod, and that was just a derivative of OS X to begin with. they spread that cost over 100+m units before the ipad launched, and what little cost there was in re-engineering it for the iPad got spread over 15m more pads and 40m more phones.

And samsung DOES pay for Android. they license the google apps, and they also have significant internnal code development to do for each unique device. Android does not run stock on their platform, and they have a dozen devices (not 3) to support, and their total sales are but about 10m units, and they only had 18 months to compact all that cost into, not to mention throwing out a dozen other products that were intended to compete with a $1K tablet, not a $499 one...

Worse for Samsung, they not only have to supprot the OS, they don;t get to SEE the OS until google is done with it. THEN they get to see what Google broke, re-engineer their own apps, re-code the Os to work with AMOLED and their chosen chips, and get it out before the competition, then continue to supprot doing that on a dozen devices every few months. Their mobile OS costs probably double Apples, and they're selling 1/10th the devices.

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Anonymous Coward

Re Apple's advantage

Nothing to do with the App store etc. iTunes is known to just cover it's costs. It's there to sell the hardware not subsidise it. Apple's price advantage is down to volume & negotiating large forward purchases backed up by wads of cash.

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re: Not really

I agree, iTunes/App Store is not a subsidy, and Apple openly admit that App Store is a marketing tool, a vehicle to sell more iOS devices.

I don't agree about HTC, Samsung et al having lower costs because they're using a "free" OS.

Apple have already designed their OS and it's been in the wild, evolving, a lot longer than Android. This is mostly about hardware design, and in that department Apple absolutely excel - in that respect, owning their own OS vs using an off-the-shelf OS does make a difference in their favour, because they understand every part of it, and are able to sustain a symbiosis between parts and software. You simply can't do that with Android, not without spending a lot of money and - importantly - losing a lot of time while Apple steamrollers ahead.

Sure, they'll fine tune their implementations and improve the kit, but every time they do, Apple will reveal it's next product and they'll all be flustering to catch up again.

I've no doubt we'll see new tablets being shown off in the next 12 months which match the iPad in performance, even construction... there's a big difference between being shown at a trade show and being available to buy, and by the time they're on shop shelves, iPad 3 will be announced, and it will all start over again.

Android is already getting messy - I haven't got a clue what Android tablet I'd buy because they all seem flawed in different ways, and don't all seem to have the same OS version, and some manufacturers are releasing them unfinished (Xoom?), and like Mobiles which are being abandoned (no firmware/OS updates?), Android just feels like a temporary, unfinished, unclear platform in general.

What happens when you buy an iPad? You get the latest OS. You don't get some bullshit "bring it back to the shop and we'll upgrade to 4G" line, or "Comes With Flash!" when it doesn't have Flash (but hey kids, it's coming *real* soon).

Thing is, Apple looks after it's brand. Even if they cock up sometimes, and they do a lot, their cockups aren't by a company which will turn a blind eye, because it's not a short-term product to them.

I'm not so much defending Apple as criticising everyone else. And there's bucketloads of irony everywhere in the news these days. Wasn't it a year ago that everyone was taking the piss out of the name "iPad", and that tablets were a stupid idea? Makes you think huh.

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Anonymous Coward

RE: This costs a lot of money which HTC, Samsung etc didn't have to pay Google for.

Eh? Only the core Android OS comes free. All the other Google stuff has to be paid for.

This can be seen easily.

If there are markings on the device similar like "with Google". Then it's the expensive Android device. If these markings don't appear then it's the cheaper Android device.

E.g. the cheaper devices have no access to the Android Market and lack many/most google apps.

Unfortunately there are no details of how much these google licenses cost. Can anyone shed a light on this?

So don't think that Android is "free" as in free beer.

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Anonymous Coward

RE:re-engineer their own apps, re-code the Os to work with AMOLED and their chosen chips

Perhaps they ought to make their chips more compatible then. Not to mention just ditch that stupid Touchwiz.

In fact if Samsung (and HTC too for that matter) where smarter they just sell their UI advancements as a separate product and generate extra income from that software alone.

Now they're only ruining an decent OS by slowing it down with their crap that everybody tries to remove afterwards. Djeez.

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Silver badge

Why is skinniness important?

Skinniness may be hard to be, but why is that important? It's the least important factor - I don't care that my netbook is slightly thicker for example, when it's still light and portable. (And it's also amusing to note that whenever someone points out actual flaws in Apple's products, the response is always "But why would I need to do that?" - yet completely pointless peculiarities about the producted are touted as being essential things.)

My Samsung netbook is way cheaper than an Ipad, and does more. Samsung are doing fine.

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Headmaster

@Mark

Totally agree, when I had my iPad I never thought this is too thick. If they can make the innards smaller or thinner then fill the extra space with battery.

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Happy

Manbag

It's important so that when I sit down in the coffee shop and take the Ipad2 out of my man bag, it is seen by as many people as possible, who will then know that I am clever, important and modern.

Lightness is important because I have carried this thing 2 miles on foot so that people can watch me working on it and know how cute I am. I had a bit of computing to do, so naturally I carried my keyboardless computer to a distant coffee shop rather than doing it all in 5 minutes at home.

My only complaint is that my arms get tired when I am holding my Ipad2 up in front of my face. I could lay it on the table but some people might not know I have an Ipad2 then.

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Happy

True Jim59

But they would know you are a dick, though you wouldn't need an Ipad for that to be clear. By making it thiner they made it lighter. Also just before the part about the Ipad being thin, the VP said "We will have to improve the parts that are inadequate" , not sure why he Reg missed that part out.

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possible?

I believe many ppl think this too.

But perhaps it's not physically possible to make e.g. 1640mAh battery without making it ridiculously big compared to the 1540mAh counterpart. Perhaps the +-1500mAh is the biggest they can build with current thickness?

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Too bad...

Too bad these Android things are too expensive.

If only iPad had flash...

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Coat

Nah, if your concerned about expense....

Archos has a 70 and 101 at sub $400 range. gTablet for $350. I'm sure there are others, but these two tend to be the "best value" so far. With the iPad2 dipping so close, even being hobbled, it will still raise the question in consumers of "with just $100 more...."

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30%

amounts to almost nothing in the larger picture. Apple doesn't make much money from the App Store at all (yet -- this may change with more content being sold there). Between this and developing their own OS and store and everything I very much doubt Apple has any advantage here over Samsung.

But Apple seems to ramp up to produce and sell 40 million iPads this year. *This* gives an advantage in price. I bet they'll be making more money per unit than Samsung.

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Coat

Guys...

The only reason there is such a price disparity between manufacturers is because Apple sells iPads at (or even below) cost trusting they will make their revenues based on the apps that run on them.

Samsung uses the same technology (ARM Processors) and many of the same suppliers and no one can convince me Apples production system is so efficient that they can save 50% producing an iPad over another fondleslab like XOOM.

Incidentally, we need a tablet called Orange, so we can have a true Apples - Oranges comparison. :P

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Silver badge

Wrong

Apple build and cost their hardware to make a profit. As others have mentioned they bulk buy huge amounts of components such as screens and flash memory.

Tear downs of the iPad show that apple make a profit on the manufacturing costs of each one. I expect the same for Ipad2.

According to this linky the moto xoom comes close to matching the iPad costs but even then not quite.

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Gold badge

Doh

Making a profit on the hardware itself (chip and materials) does not equate to making a profit in total.

Things have to be designed, prototyped, refined and manufactured. Designers and engineers do not work for free. The device needs software to work, that has to be written.

A DVD costs a few pence to make, but the film on it cost millions to make. So while you think a DVD at £13 is massively overpriced you have to look at the bigger picture.

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Coat

It can't be that hard.

After all, it's really just the iPad 1.5!

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Alert

Efficiency

It's as simple as that.

Everything from the OS to the design, manufacturing processes, even bulk acquisition of parts, are all evolutions of already existing Apple-created tech and ongoing R&D. They're already running, while everybody else is trying to replicate what they've done but without the benefit of having all their chess pieces in place already.

The fact that everyone else is having to use an OS made by someone else (Android) is just going to increase their costs, as they have to design hardware to work with the OS, and since they don't have a real hand in future OS features, they're mucking around in the dark. What works today might not work in 6 or 12 months time. That leads to a lot of wastage. It's not efficient: It's expensive.

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Stop

must be the reason

Must be the reason why PCs cost so much more than the MAC?

The whole idea of designing and developing a proprietary OS and hardware is pretty much proven to be a bad idea. Sure Apple has survived. And has even been profitable. But, that day is past.

And just look at the range of products from the XOOM to the Atrix to very cheap Android units.

In the Apple world you buy from one company, one product and pay a high price. With very little variety. Does Apple still think that only one size works?

Android tablets are very likely to do the same for tablets as they have done for smart phones. Namely a lot of choices to satisfy the various needs of consumers everywhere. Some will specialize for consumers. Some for corporate use, etc. Some are premium. Some are bargain basement.

Oh, and they all offer media subscriptions for a lot less money than Apple.

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Anonymous Coward

Truely a bad idea.

"The whole idea of designing and developing a proprietary OS and hardware is pretty much proven to be a bad idea."

I wish I could come up with a bad idea that would make me one of the biggest capitalised companies in the world, turning ever increasing profit records every quarter. Or give m ea shop in London's west end that makes more profit per customer than any other shop in London.

These bad ideas are so hard to come up with.

Oh, Ive just realised, you are using 'bad' in the street sense. My mistake.

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re: must be the reason

"Must be the reason why PCs cost so much more than the MAC?"

The Mac costs more because their build quality is up there. You want a cheap PC, buy a cheap PC. You want a very high quality boxed Windows desktop? You'll pay the same as a Mac Pro.

"The whole idea of designing and developing a proprietary OS and hardware is pretty much proven to be a bad idea. Sure Apple has survived. And has even been profitable. But, that day is past."

That day hasn't passed. The day is still young, and I think it's going to be quite long.

"And just look at the range of products from the XOOM to the Atrix to very cheap Android units.

In the Apple world you buy from one company, one product and pay a high price. With very little variety. Does Apple still think that only one size works?"

Variety is what you get from a stall selling fake watches. If the product is good, you don't need variety - you just need to stick to your guns and improve the one product. You think Xoom et al are trustworthy product lines? The truth is they're manufacturers dipping their toes in the water in a marketplace they never even expected to exist 12 months ago. There are no assurances, except that desperate people don't think clearly.

"Android tablets are very likely to do the same for tablets as they have done for smart phones. Namely a lot of choices to satisfy the various needs of consumers everywhere. Some will specialize for consumers. Some for corporate use, etc. Some are premium. Some are bargain basement."

Now you're trying to make a prediction, but it's not worth anything until you acknowledge the state of play.

"Oh, and they all offer media subscriptions for a lot less money than Apple."

And here we come to the meat of it... you can't see the forest because you're looking at an ugly little bush.re:

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Anonymous Coward

I tend to dissagree.

The whole idea of designing and developing a proprietary OS and hardware is pretty much proven to be a very good idea. All the people who started companies who have done this are filthy rich today. The founders of Acorn Computers Ltd.(Hermann Hauser, Chris Curry and Andrew Hopper), Jack Tramiel (Commodore), Nolan Bushnell (Atari), Steve Jobs (yes that one), Clive Sinclair. Though most o/t companies themselves are gone today, the founders are not. They live the good live. Laughing at us, naive consumers, who made them filthy rich.

Also it's already been proven how cheap the parts used in various Apple products really are. In fact the screen of the miraculous iPhone is made by cheap-ass LG. They make huge profit of each and every HW/OS-product they sell. Profits that are spend to create a hi-tech, hi-quality premium image and off-course to thicken their already fat bank-accounts. Nonetheless it doesn't mean Apple (the company) will remain forever. Just look at what's happening with giant Nokia. We ALL know how that will end. Though I doubt that Björn Westerlund (the founder of Nokia's electronics division) will really care (partly because he deceased in 2009).

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Thumb Up

brand image of the competitors?

The way I see it, Apple has developed a very strong brand image over the last few years. The iPad/tablet market has not yet been commoditised and possibly may never be that way (like the mobile phone market). So I feel it's going to be much more about brand and image. In that area Apple trumps the rest in spades.

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