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Phil Schiller, Apple's senior vice president of worldwide product marketing, talks about the iPad Mini on Tuesday.
Marcio Jose Sanchez/ASSOCIATED PRESS
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SAN JOSE, Calif.--Apple Inc. is refusing to compete on price with its rivals in the tablet market--it's pricing its new, smaller iPad well above the competition.
On Tuesday, the company revealed the iPad Mini, with a screen that's about two-thirds the size of the full-size model, and said it will cost $329 and up.
Apple starts taking orders for the new model on Friday, marketing chief Phil Schiller said at an event in San Jose, Calif. Wi-Fi-only models will go on sale Nov. 2. Later, the company will add models capable of accessing "LTE" wireless data networks.
The price fits into the Apple product lineup between the iPad 2 at $399 and the latest version of the iPod touch at $299. But company watchers had been expecting Apple to price the iPad Mini at $250 to $300 to counter the threat of less expensive tablets like Amazon.com Inc.'s Kindle Fire, which starts at $159. Barnes & Noble Inc.'s Nook HD and Google Inc.'s Nexus 7 both start at $199.
Apple shares fell $14.83, or 2.3 percent, to $619.20 when the price was announced. Shares of Barnes & Noble Inc. jumped 91 cents, or 6.3 percent, to $15.35.
Shares of Amazon.com Inc. were down 12 cents, or less than 0.1 percent, at $233.66 while the rest of the stock market was in retreat.
When pre-orders start on Oct. 26, the iPad Mini will be competing for the attention of gadget shoppers with the release of Windows 8, Microsoft's new operating system.
The screen of the iPad Mini is 7.9 inches on the diagonal, making it larger than the 7-inch screens of the competitors. It also sports two cameras, on the front and on the back, which the competitors don't.
The iPad mini is as thin as a pencil and weighs 0.68 pound, half as much as the full-size iPad with its 9.7-inch screen, Schiller said.