What's the deal with Apple's iPad and Macbook pricing?

Apple launched a new iPad line up, an operating system and a Mac Pro on Tuesday, but one of the main talking points after the event was actually the company’s pricing strategy.

CEO Tim Cook announced that the new iPad mini with Retina Display would cost $399, which is around $70 more expensive than last year’s model. Apple also introduced for its thinner, larger iPad Air, for $499.

But then in a surprise, Apple introduced slightly revamped MacBook Pros at prices 9 percent to 13 percent below the previous versions.

What’s more, it is giving away its latest Mac operating system Mavericks for free, as well as several pieces of software, including programs called iWorks and iLife that provide many of the same tools as Microsoft’s Office.

“We are turning the industry on its ear,” Apple CEO Tim Cook said of the company’s strategy.

It is certainly leaving a lot of people wondering what the pricing is all about, and the analysis is flying in thick and fast.

Bloomberg feels that the company is betting on fan devotion, at least as far as its higher priced iPads are concerned.

“Even as rivals such as Amazon.com Inc. , Samsung Electronics Co. and Google Inc. introduce tablets at lower prices, Apple Chief Executive Officer Tim Cook went in the opposite direction yesterday”, the report noted.

It quoted Yankee group analyst Carl Howe as saying, “Apple has never been about market share. They are content to take the profitable piece of the market”.

CNet for its part said that by packing the iPad mini with the same features as the iPad Air and pricing it for just $100 less, Apple was cannibalizing its own market for the larger tablet.

“This $100-per-step upgrade has gone on for years and worked out well for Apple, but perhaps it has never made such a difference as with these tablets, which are priced so close together,” it said in a report speculating on which device consumers would go for.

Technology analyst Patrick Moorhead was quoted by AP as saying that “Apple doesn’t want to play in the mud with declining prices”

As far as the pricing of its MacBook Pros goes, analysts feel that Apple’s move to reduce prices would amount to all round price slashing across the PC market.

According to this report in Associated Press:

_Technology analyst Patrick Moorhead predicted the discounted MacBook Pros will force personal computer makers to cut the prices of their machines by at least $100 for the holidays. And Ovum analyst Jan Dawson thinks Apple’s giveaway of the operating system and software programmes “is now teaching people to expect both of those things to be free._While this won’t disrupt Microsoft’s business overnight, it will create further pressure on Microsoft to bring down prices.”

If that happens, it would be another blow for Microsoft, which has seen its Windows revenue suffer in recent years as personal computer sales sink amid a shift to smartphones and tablets.

This, together with its decision to provide alternatives to Microsoft’s iconic office suite is seen to be an Apple attempt to take down Microsoft.

But in a blog post , by Frank Shaw, Microsoft’s corporate communications vice president, breezily said that Apple’s strategies were no big deal.

“Seems like the RDF (Reality Distortion Field) typically generated by an Apple event has extended beyond Cupertino…Apple’s decision to build the price of their less popular and less powerful iWork into their tablets not a very big (or very good) deal”, he said.

The buzz continues, but the verdict as always will be delivered by the consumer.