DigiTimes is reporting that several tablet manufacturers were surprised at the low entry-level price $499 price of the iPad. They are now scrambling to reevaluate their pricing schemes.
The vendors originally planned to offer prices pegged at 20-30% lower than the Apple iPad, while they generally expected the device to cost as much as US$1,000. The US$499 entry-level price has caught vendors by surprise and means they will now need to adjust their price scales even lower to attract consumers, the sources pointed out.
The report goes on to say that other tablet manufactures are hesitant to drop their pricing below Apple’s in fear that it will start a price competition that will drastically lower profit margins, before the tablet market even has a chance to mature.
I smell competition.
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