Updated: 10/22/2013 4:12 PM
Created: 10/22/2013 7:24 AM KSTP.com
By: Scott Theisen
Apple Inc. is refreshing its iPad lineup and slashing the price of its Mac computers ahead of the holiday shopping season, as it faces an eroding tablet market share and growing competition from rival gadget makers.
Apple unveiled a new, thinner, lighter tablet called the "iPad Air" along with a slew of new Macs Tuesday at an event in San Francisco. The iPad Air weighs just 1 pound, compared with 1.4 pounds for the previous version. Apple marketing chief Phil Schiller called the tablet a "screaming fast iPad." He said it is eight times faster than the original iPad that came out in 2010.
The iPad Air will go on sale Nov. 1 and start at $499 for a model with 16 gigabytes of memory. Apple plans to phase out its third and fourth generation iPads while the iPad 2, which launched in 2011, continues selling at $399. A new iPad Mini, meanwhile, will be available later in November starting at $399 for a 16-gigabyte model. It has a retina display designed to give it a clearer, sharper picture and the same 64-bit chip that powers the iPad Air.
"I think today was about re-establishing that the iPad is the benchmark for what a good tablet experience should be," said Gartner analyst Carolina Milanesi. "Too many times when we look at these devices we focus on hardware, not the whole experience."
The iPad's market share has been eroding compared with cheaper rivals running Google Inc.'s Android operating system. Research firm Gartner Inc. estimates that Android tablets will end 2013 with a 50 percent share of the worldwide market versus 49 percent for the iPad. Just two years ago, the iPad commanded a 65 percent market share compared to 30 percent for Android tablets.
Apple sold 14.6 million iPads in the June quarter, down 14 percent from the same time last year. It was the first year-over-year decline in iPad sales. Nonetheless, Apple CEO Tim Cook touted that Apple has sold 170 million iPads since the tablets launched three years ago.
Tim Bajarin, a Creative Strategies analyst who's followed Apple for more than three decades, said the 64-bit chip in the new iPads makes them the most powerful tablets on the market. Keeping the iPad 2 on store shelves also makes sense, according to the analyst.
"That's the one that's a big hit in Asia and emerging markets," Bajarin said. "It's still got a lot of traction."
Apple also refreshed its computer lineup. A new, 13-inch MacBook Pro with Retina display is thinner and lighter, Schiller said, adding that the laptop has up to 9 hours of battery life, enough to watch the entire trilogy of 'The Dark Knight' on one charge. The notebook's new price is lower: $1,299, compared with $1,499 for the previous version.
A larger MacBook Pro, with a 15-inch monitor and 256 gigabytes of storage starts at $1,999, compared with $2,199 for the previous version.
The Mac Pro, a high-end desktop computer aimed at what Apple calls "power users," will be available in December for $2,999.
The company also said that its latest computer operating system, Mavericks, is available free of charge.
Apple's new gadgets come not only at a time of toughening competition. They arrive as retailers face an uncertain holiday season following a 16-day partial government shutdown. Retailers say Washington's gridlock has caused people to hold off on shopping, though they hope that this won't last throughout the holiday season.
Evens so, some analysts are optimistic about Apple's prospects.
"Between the iPad and iPhones, I think they'll have a monster holiday season," Bajarin said.
Shares of Cupertino, Calif.-based Apple climbed 83 cents to $520.70 in after-hours trading. The stock had closed down $1.49 at $519.87.
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