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True Cost of iPad

By Edited Sep 24, 2016 0 0

Though the Apple iPad is so young, it's already a star. The Apple fans have been captivated by the mere idea of the gadget since it even didn't have a name. Actually, they can't be blamed for that, as there's nothing you can object to them. The new gadget is totally beautiful, sleek and offers tons of productivity at your fingertips. You can use it both while lying on the couch or stuffed into the traffic jam. Apple says that the iPad is their most advanced technology at the moment, which can allow you to organize the schedule, surf the Internet, check e-mails, show and arrange pictures, navigate maps, and download content of any kind on-the-go with just two taps of a finger.

All this comes in a sleek package of only 9.5 inches long, half-inch thick and 1.5 pounds weight. As opposed to a smartphone, the Apple device is very convenient for two-hand use. The most importantly, it finally allows you to get by without bringing laptop, newspapers, magazines and books.

The gadget seems to mesmerize not only adults, but also kids. That's cool, of course, but would it be as cool for your wallet? The cost of using the device doesn't often equal to its sale price. If you understand the level of final costs, it may influence your purchasing intent. Let's run the numbers.

iPad real cost
First of all, the initial capital outlay should be made. The iPad is currently available in 6 versions starting at $500 up to $830. The price varies depending on storage capacity (like iPods) and also on type of Internet connectivity, which can be either Wi-Fi or Wi-Fi + 3G mobile broadband (like smartphone). Specifically, support for 3G mobile broadband is a $130 more expensive than Wi-Fi only. The item we opt for is a middle-of-the-road 32GB iPad with Wi-Fi + 3G, priced at $730 plus tax. Of course, you'll buy some extra accessories for the device, like the cover for iPad and a connection kit, but it actually depends, so we won't take these expenses into consideration.

In addition, the 3G designation bring in another cost – a monthly data plan, which is sold separately by AT&T. This we will cover too, as that's one of the great things about this gadget – its portability. With this particular iPad and involved costs you'll to be able to go online whenever you like. The plan in question comes in 2 options: limited for $15 p/mo and unlimited for $30 p/mo. To prevent costly overages, we'll opt for the latter, which would cost another $360 per year just to get online.

Then, after e-mail, news and YouTube are covered, you'll note that such incredible 10-inch display is worth being filled with multimedia. Is it better to choose from United Airlines' offer then to take an advantage of the iTunes store right at your fingertips? We'd assume the answer is no. Move to the figures: TV shows are $3 each episode (except classic Star Trek episodes that are free online), while a film rental is $4; while purchase is $15. In average we'd say the user watches a whole season of 12 episodes of TV show per year and about 10 movie rentals. This totals to $76.

The estimations done bring us to the total cost of $730 + $360 + $76 = $1,166. And that's only for one year, which is not the time you would want to keep this device for. Considering an AT&T contract is 2 years, and the user is able to resist the urge to upgrade, then the fair time to keep the gadget is 4 years. They make it $730 + $360*4 + $76*4 = $2,474.

iPad real savings
Figure of almost $2,500 for owning and using the iPad is quite depressive, but there's also the second side of the ledger, assuming that this computing power can actually save you money.

Thanks to the tablet's size and beautiful display, the device will consolidate your magazine and newspaper subscriptions, which is great news for the wallet, at least for now. It can even look like a real book if you zip it into the appropriate iPad case. The matter is that the majority of news companies and magazines publish their articles for free in the Internet. However, the situation can change quickly, but we'll hope for the opposite. Even those titles that don't provide free copies online charge significantly less for digital subscriptions than for printed versions. That's fair for the costs – all they need to cover is copyright, or journalists' work – no printing and no delivery costs. Now let's count. Imagine an average iPad purchaser (of a corresponding level) subscribed to The Wall Street Journal, The New York Times, The Economist, and Time. The Wall Street Journal costs $119 per year for printed version while the digital one is $103. Then, The New York Times costs $608.40 annually with home delivery, while online is free at the moment (though the newspaper has promised to change prices in 2011). The Economist charges $127 annually with $95 for online version. Finally, Time is $20 in printed and free in the Internet. In a year online access will save you for these 4 publications ($119 – $103) + $608.4 + ($127 - $95) + $20 =$676.4, for the first year at least. Even if The New York Times announces its new pricing, it would most probably not exceed 80% of the printed version cost, or $486.4, thus saving you a hypothetical $122. This will drop the initially suggested savings down to $190, starting from year two.

Besides replacing newspapers and magazines, iPad can also substitute some other devices, so we'll substract their price from the cost as well, because you won't need them when you get an iPad. Let's start with reading experience. Since iPad is perfect for e-reading, it will replace Amazon Kindle, which is around $260. Also the Apple's gadget can substitute an average Netbook, which is, say, $350. That's another $610 you save in device replacements. Although the device can replace many other gadgets like digital photo frame and day planner, we don't count this because few people use them – the majority uses smartphones as planners, and don't use digital photo frames at all, unless they are taken as a gift and therefore free.

Getting back to the reading experience, it's worth noting that the Apple's latest gadget may replace printed books with Apple thinking over pricing at $10 to $15 for the book depending on its popularity. If you find yourself in a bookstore at a regular basis, buying books at full retail price, this would be quite a saving for you. On the other hand, you might have already discovered Amazon, which prices can be compared to Apple's. In case of using a Kindle, the book price can actually be $3 to $5 less than on the iPad. If you used to purchase around 20 books a year in the shop, it will save you up to $300 annually, but if you preferred a Kindle, that's just a potential extra cost of $100, plus you can't account for Kindle replacement savings since you should have the device already.

This brings up to total annual savings of $676 + $610 + $300 = $1586 or $676 + $350 - $100 = $926 if you were a Kindle user. That's for the first year after purchasing the iPad. The next three add $190*3 + $300*3 = $1470 or $190*3 - $100*3 = $270 for Kindle users. In total, you would either save $3056 or $1196 in the 4-year time. Not bad, considering that your cost was $2,500.

Cost of Innovation
Those who see the gadget as an investment for their productivity should clearly understand that it's the kind of investment on which they may never see a concise return. But besides money there are some certain things you won't be able to measure in cash, like forgetting about the shoulder ache after carrying your huge laptop over to the airplane. iPad can also save much of you time by providing you the ability to access documents on the fly, and finally, you will never forget the excitement of owning the most popular gadget of this decade.

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