iPad mini launch sees mini queues: is Apple losing its grip?

The iPad mini may have sold out online, but today’s product launch has failed to attract the massive queues which usually greet release of a fresh Apple [AAPL]  product, so is the company’s stellar run at the cutting edge of consumer imagination over, or are we reading too much into what’s going on?

[ABOVE: Video taken at the Apple Store, Nagoya Sakae, Japan this morning (Macotakara)]

Short season

As the iPad mini goes on sale at retail stores this morning reports claim small queues outside of Apple’s stores: 

  • 50 people waited outside its store in Sydney, Australia,
  • 100 sat in wait at Tokyo and Seoul,
  • 100 gathered outside its store in Amsterdam,
  • Maybe 100 took position at the company’s flagship Regent Street, London store. 

In the US reports are mixed: despite Hurricane Sandy, New York saw 500 wait for the new device, while some Apple retail stores saw no queue at all. 

To be fair, many on the Eastern seaboard won’t be able to pick one up even if they want to brave the superstorm, as delivery to many retail locations there has been delayed. And it’s worth noting that for most in the US the last few days has been focused on the terrible events across the Eastern seaboard rather than on the release of a shiny new consumer electronics device, Post-PC or no.

In London one shopper observed how the cold may have impacted the queue. "It was cold, but good like every launch. We have a good time. It's just a bit of fun really,” he said, adding, “I'm going to take my Google tablet back. I got that about a month ago," just before the iPad mini was announced. 

[ABOVE: iPad mini versus some Android tablet. The iPad almost works after the drops. The Android? It really doesn’t.

Reality shift?

Expectation for the new device has been high. 

The 7.85-inch tablet’s been discussed for months, with media and analysts working themselves into a frenzy at Apple’s attempt to widen its grip on the tablet market it still leads. There’s been less excitement among tech media readers: anecdotally this reported notes that while thousands might flock to read an iPhone 5 story, attention generated by iPad mini tales has been a fraction of this. 

One Apple product release has attracted no expectation at all: the iPad 4. Apple surprised everyone when it introduced the new configuration beside the iPad mini -- no one had expected it. It’s fair to say that focus has been on the iPad mini at the expense of the now announced new iPad, which isn’t attracting much attention from consumers. “As for the iPad 4, nobody even mentioned it,” observes Macworld UK.

The iPad 4 is really just a maintenance release, introduced to widen LTE support to more international territories and to harmonize the iDevice range across the new Lightning connector. However, it’s surely worrying for Apple’s teams that the company has managed to upgrade arguably its most important product without creating any excitement at all. Though an early 2013 upgrade seems likely.

[ABOVE: Over 500 queue in NYC two hours before the doors open.]

What's in the way?

Price may also be a problem. The 7-inch tablet market is already served by sundry Android devices. These may not offer the same quality or design aesthetic as Apple’ s iPad mini, but they are cheaper. Speaking to the Wall Street Journal one iPad mini purchaser said the $329 price tag on the mini is “high”. 

Prior to the release there had been some expectation (including by this reporter) that the company may have planned to munch the market with a low cost release. While this didn’t turn out to be the case consumer’s may already have decided that $200-$300 is what they are prepared to pay for products in this category.

It is also possible shoppers are waiting on Apple’s introduction of the LTE version of the iPad mini later this month. Piper Jaffray analyst, Gene Munster certainly expects initial demand to be relatively muted. He believes the company will sell between 1 and 1.5 million units across the launch weekend.

"The reason we expect fewer iPad minis compared to the 3rd Gen is because of the lack of the wireless option and newness of the smaller form factor for consumers," Munster said. "We believe that over time that will change."

Sterne Agee analyst Shaw Wu said in a note to investors on Thursday: "We continue to believe that the iPad mini is the competition's worst nightmare and will likely slow down the adoption of competitor tablets."

Connection change

Apple has attracted a spate of negative headlines in recent months: from working conditions in its factories (though there’s been little follow-up investigation of conditions across other manufacturers; to the failure of iPad 4 LTE outside of North America; the so-called ‘Map-gate’ affair and, of course, the continuing bad feeling on strength of the many court cases concerning iPad and iPhone patents.

Those matters haven’t been helped by a series of own goals, most recently Amazon’s response to Apple’s iPad mini display claims and a perception of dumb insolence as regards its requirement to print some form of apology pertaining to Samsung’s copying of its ideas as required by the UK court.

The impact of all these high profile criticisms has been to dent the company’s brand appeal among rank and file consumers who -- anecdotally at least -- appear more skeptical concerning the company’s products than this reporter has found them in the past. 

This tarnishing of the brand hasn’t yet been reflected in consumer satisfaction and brand index surveys, but the muted enthusiasm greeting launch of the new iPads suggests this might be the essence of the next spate of such reports.

However, as Apple heads into what’s expected to be its most successful Christmas quarter yet, Apple’s marketing chief, Phil Schiller, is no doubt studying the latest reaction and consumer behavior surveys. 

He will attempt to assess if the company can easily reclaim its place in the heart of the 21st Century consumer, or if the side-effect of its widely-publicized battle with Android has been to dent the faith the company worked so hard to create as it fought back from extinction on the back of a quintet of epoch-defining products: iMac, iPod, iPhone, iPad and, of course, OS X.

Apple and its competitors will be watching events across the next few months with great interest in order to figure out if the company has lost its connection with consumers.

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