Why Apple kept the iPad 2 around

Credit: Apple webcast

If you look at the new iPad lineup that Apple announced today, the big news appears to be that Apple has revamped the hardware of the iPad to deliver an incredible amount of power in the lightest and thinnest form factor imaginable. Despite that, there will probably be plenty of pundits proclaiming disappointment at an iterative update to a nearly four year old device and concept and pointing out that because of their form factor and typical use cases, the specs of a tablet matter much less than the specs of a PC. There will also be disappointment that Touch ID remains available only on the iPhone 5S.

The bigger story, however, is the one that Apple told around the introduction of the iPad Air. That story included a video that illustrated all of the ways that iPad has become a professional tool for millions of people around the world ---- and that captured the potential of the device in a way that no list of features, apps, or case studies ever could. It culminated not just with the announcement of the iPad Air, but of an entire lineup of iPads.

The story here is that Apple has diversified a product that has, in some ways, taken on a life of its own. One of Tim Cook's most interesting comments was that Apple couldn't have imagined all the ways its customers have used the iPad. One gets the impression that even Apple didn't realize how popular the iPad would be in professional and business settings.

While the iPad has steadily lost market share to other companies in the tablet market since it was introduced (and essentially created the tablet market as we know it today), the device has managed to find a very secure foothold in a very diverse range of workplaces. Despite the predictions that other, more work--oriented, offerings would sweep iPads out of the office, that hasn't happened -- at least nowhere to the degree that was once predicted -- even with serious enterprise companies like Microsoft, HP, and BlackBerry trying to oust the iPad.

By diversifying the iPad line, Apple is following a template that it established with the iPod -- launch a single initial product and as that product becomes established branch out with variations that appeal to more cost-conscious and more feature-demanding audiences. That doesn't mean that the iPad won't remain a premium product -- even the best-selling iPod models always cost more than some competing products -- but it does mean that Apple is delivering more choice and appealing to specific needs of varying customers including individual consumers and business users as well as companies and schools.

Two types of tablet user

My Twitter feed exploded, like many others, with surprised comments about Apple's decision to keep the iPad 2 in the lineup rather than the two newer variations of the full size iPad, both of which featured retina displays and offered an LTE option. While most people expected a retina display on the iPad mini, many were surprised to see the original remain in the lineup at a slightly reduced cost.

Apple is making a shrewd move with these choices. The company is acknowledging that there are basically two camps when it comes to tablets -- those that want a smaller and more portable device (the iPad mini) and those that want a larger, full size device. Within each of those, Apple is catering to a higher and lower end in terms of budget and feature set.

The reason to keep the iPad 2 rather than a newer model is likely because there's a much greater distinction between that product and the new iPad Air than there would be between the iPad Air and the fourth generation iPad. If you really want a full sized iPad and you're focused on spending as little money as possible, Apple will sell you an iPad 2, but for just $100 more, you get a better quality display, thinner form factor, better battery life, and a slew of new features in both the device and the OS.

$100 isn't all that much money and considering how much more bang you get for your buck if you opt for the iPad Air instead, it almost doesn't make sense to go for the lower-priced product. If Apple were selling the fourth generation iPad instead, the end value of that $100 would be much less and it would be harder to justify the expense. The same holds true for the iPad mini, particularly when you consider the price drop of last year's model, while being just $20, puts it below the $300 threshold making it seem slightly more competitive on price with some other tablets on the market.

What does the new lineup mean for business?

The new lineup means that businesses looking to deploy iPads have a greater range of choice. Each model is naturally a better fit for different kinds of tasks. The iPad mini is preferred by many doctors simply because it fits in a lab coat pocket. A field auditor for a company would prefer the larger display and larger keyboard options. A sales or marketing professional would be an ideal choice for the iPad Air because of its size, weight, and value as a status symbol when meeting with customers or clients.

At the same time, that choice isn't coming with fragmentation. All of the iPads in Apple's new lineup can run iOS 7 complete with all its security and enterprise functionality (though certain features like Siri aren't available on the iPad 2). Developers only need to design for two screen dimensions when they create iPad apps: the 2048 x 1536 resolution used in the iPad Air and new iPad mini with Retina display (and the third and fourth generation models) and the 1024 x 768 resolution of the iPad 2 and original iPad mini. These aren't small advantages when you're looking at a large deployment and they shouldn't be overlooked.

It's also important to acknowledge that Apple's pricing strategy with the the iPad 2 and original iPad mini applies differently to bulk purchasing by a company or school than it does to individuals. If you're just buying a single iPad for yourself or perhaps a couple as a Christmas gifts for your kids, that extra $100 isn't too extravagant and is easy to justify. If you're a ordering a hundred iPads for use as POS systems in a retail store or a thousand for all the kids in your school district, that savings is much more significant.  

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