Marco Arment on the rumored iPad mini:
I bet they could sell that for $249, and that would be a steal. The iPad 2 is still great by today’s standards, and in some ways, it’s actually better than the iPad 3.
I don't doubt that they could, but I doubt that they will. Apple has never worried about figuring out how to make devices more accessible to more people. Apple does worry about healthy margins. Plus, it would be priced too closely to the iPod touch (which starts at $199 now) and would do everything it does, except better1. If Apple ends up introducing an iPad mini at the Fall event, where they traditionally introduce iPods and other media-centric products, I think it would be positioned as the top-end media device above the iPod touch instead of being positioned as a cheap iPad. And it would probably need to start at $299 to make sense in the lineup, especially since we know that Google is selling the Nexus 7 at cost at both the $199 price point.
In fact, if it weren't for those part leaks I was starting to think Apple was eliminating the iPod touch from the line-up this year. I've never understood the appeal of an iPhone without the phone, so my desire to see the iPod touch eliminated is probably just my own wishful thinking. In any case, I believe the iPad mini will cannibalize sales of the iPod touch regardless of how much higher the price is. ↩