The first thing to know about the new iPad is that it's different. Not just different from the first iPad: different from other products on the market.
A key part of that difference is the screen. It's an illuminated plane that Apple's marketing whizzes have dubbed a "Retina Display." The screen's defining characteristic is that when you look at it from a typical distance — Apple says 15 inches, I say about 18 because my vision is slightly better than 20/20 — your eyes literally can't distinguish the pixels on the screen.
The reason? The pixels themselves are so small and close together that the eye can't tell they're dots. The effect is a little like you're looking at reality through a pane of glass. It doesn't feel as though you're interacting with something computerized. It feels like you're controlling an analog reality beneath the glass.
When I first saw the display up close at the iPad launch event last week, the Retina Display struck me as a cool invention that shoppers would probably notice and enjoy. An analyst I spoke with this week, one who's reasonably bullish on Apple, referred to it as an incremental improvement.
The Retina Display itself isn't new. Apple introduced the concept with the iPhone 4 a year and a half ago. And technically, the iPad screen is lower resolution than the iPhone 4, with fewer pixels per inch. (Apple reasons that you don't hold a tablet as close to your face as you do a phone, so you're less likely to see the pixels.)
After I got a unit to put through the paces for a few days, I developed a more informed view of the display and its impact. More on that a bit later.
First, let me explain what I'll try to explore in this piece. As a consumer technology reporter for the San Jose Mercury News 10 years ago, I did plenty of reviews; I was among the first to write about risky products like the first iPod, the Titanium PowerBook and the G4 Cube. As a CNBC correspondent, though, my goal is a bit different.
I'm not looking to tell you whether to go buy a new iPad. Every tech blog on the planet (and every major newspaper) will be doing that, and you can probably guess what they'll say. Instead, I'd like to focus on the business-side implications of the device: Is it likely to be good enough to continue Apple's tablet momentum? What does it mean for Amazon's Kindle, Microsoft's Windows 8, and the bevy of Android competitors? And is this the version of the iPad that has a shot at taking share from Windows PCs?
Let's dive in.
Is It Good Enough?
Let's first consider the baseline: Apple sold 15.4 million of the old iPads in the holiday quarter of 2011, far outselling the nearest competitor. Apple's strategy had been to offer a tablet with a 9.7-inch screen, tuned mostly for content consumption. Videos and photos were easy to view on the older iPad, but the most common knock on it was that it wasn't much of a tool for content consumption.
Enter the new iPad. This one has a 5-megapixel camera on the back, on par with the iPhone 4S. It has the Retina Display. The A5X chip makes it just as responsive as the older iPad, even though it has to work much harder to animate four times more pixels on the screen. The base price? Same as the old iPad: $500.
But this is a significantly different machine. Because the rear-facing camera takes 1.2 megabyte jpeg images at 2592 x 1936 resolution and shoots 1080p video, it has potential as a content creation tool. And because it now has a suite of software for editing photos (iPhoto) as well as videos (iMovie) and documents (Pages and Numbers), it's more than just potential. You really can create content with this.
This really hit me when I took photos with my Pentax K-x DSLR and imported them into the iPad. The sharpness of the photos on the Retina Display was unlike anything I've seen before on a screen that size. Yes, the iPhone 4's screen is sharper — but scale makes the difference here. A professional photographer would never consider editing photos on an iPhone screen, but with this level of resolution, the experience editing on an iPad could be even better than on a laptop. I shot 10-megabyte files and found the iPad manipulated them more quickly and smoothly than a standard MacBook Air could.
The iPad is not the perfect creative platform for everyone, of course. The on-screen keyboard is still awkward to those who are used to typing on actual keys, and those who want to use the iPad as a heavy-duty tool will have to learn a new "language" — the PC-era menus and click-and-drag controls are giving way to pop-up palettes and touch sliders.
So is it good enough to continue momentum? Probably. Not only is the old iPad $100 cheaper, but the new iPad is considerably more useful than its forbears. Web surfing on the old iPad was a good experience. With the Retina Display — a screen that's both touch responsive and sharper than you can find at its size anywhere in the mainstream consumer market — it's a far more visceral experience.
What does it mean for the competition?
What Does It Mean for the Competition?
This presents a vexing challenge to other tablet OEMs. Should they attempt to match Apple's Retina Display? For most everyone (with the possible exception of Samsung), that's not really an option. Apple knows it can move tens of millions of tablets in a year, justifying the upfront cost of manufacturing the screen. Apple also has a custom chip capable of driving the display, and specialized software that takes advantage of its capabilities.
That leaves two more possibilities: try to compete at the mid-range with the old iPad 2 at a $400 price point, or compete at the low end, with the Kindle Fire.
At the mid range, expect a couple of approaches to emerge. One: tablets with screens under 9.7 inches that cost about $400 and have better cameras than the iPad 2. Two: tablets with screens at about 9.7 inches that cost about the same as the new iPad, but have cameras with higher megapixel numbers, or that include more storage. Apple's rivals have tried these approaches before, with limited success. The arrival of Windows 8, with its Metro interface and Office software compatibility, could give them a better shot.
And then there's the low end, where the Kindle Fire now rules. It seems likely that Amazon will continue to sell millions of Kindle Fires. The question, though, is whether buyers will continue to use them long enough for Amazon to monetize them through increased digital sales.
Bottom line: From a competitive standpoint, the new iPad has changed the terms of the tablet debate in a way that's going to make things harder for even scrappy players like Amazon. From years of HDTV shopping, consumers know how to spot a better screen in an in-store lineup.
Is It a Threat to PCs?
Which brings us to the final question: How big is the iPad's opportunity here? Is it a threat to PCs? Can it continue doubling sales year-over-year, for the next few quarters, or will that growth trail off?
Apple has put itself in a good position there: the iPad launches in 10 countries on Friday, and 25 more a week later. In the U.S., it will be on shelves at Walmart , Sam's Club and Target as well as Best Buy and Radio Shack , ensuring that it gets mainstream shopper exposure, not just repeat Apple customers.
Then there's the fact that pre-orders of the new iPad are already sold out; that bodes well for demand. Apple could very well have a repeat of the iPhone 4 situation on its hands, where the biggest challenge isn't making consumers aware of its technology, it's building them and shipping them as efficiently as possible.
Will this kill the PC? Not even Apple CEO Tim Cook is predicting that. But if you're making a list of things a PC can do that an iPad can't, that list keeps getting shorter.