Would Apple Unleash A 3G Netpad?

I’ve said it before, and I’ll say it again. I don’t believe Apple will do a netbook, at least…not in the way it has been done by companies like Asus and Dell. Tim Cook, Apple interim CEO said flat out that they didn’t see value in the segment, which is often Cupertino code for “yeah, we’re interested…but not until we can deliver it with a money-making twist”

This week, rumors surfaced that an unknown company would be releasing a $99 device this summer that used AT&T’s 3G network for wireless data. The cost of the device would be subsidized over the life of a contract (like an iPhone) but most tantalizingly of all was the news that it wouldn’t be running Windows. As you can imagine, it didn’t take long for the Mac rumor mill to crank up with speculation that Apple was readying a 3G netbook. As much as I want to believe it, as much as I would welcome such a device, I can’t quite drink the Kool-Aid…and here’s why.

1) A 3G enabled netbook for under $100 would completely destroy traditional macbook sales, and Apple isn’t about to do that.

2) It doesn’t make sense from a marketing standpoint. If Apple is going to release a potentially game-changing new feature, it’s not going to be on a low-profit device at the bottom of the product pyramid. Instead, it’s going to debut on something unique, a marquee product that will have everyone talking…and drooling.
3) Currently, Radio Shack sells the Asus Aspire netbook for $99 with a 24 month contract at $60 per month which means a total cost over that 2 year period of $1539…which is more expensive than a brand new aluminum macbook.

Apple would need to be readying a striking new mobile device

So, what does all this mean? As I see it, if this rumor is true, Apple should produce new device that carries enough appeal to be worth signing a multi-year contract for, but one which is different enough from their other products so there is no chance of cannibalization. It must have a good profit margin, but ideally it should defray that cost in a way consumers are comfortable with.

I know many will disagree, but I think we may be looking at a summer debut for a new pad-like touchscreen device…similar to the current iPod Touch only larger with a screen. It would be crazy thin (like the Touch) and would offer both wi-fi and 3G. It would run the iPhone OS and would have the same access to apps, TV shows and movies through the iTunes store. The larger screen could also open up possibilities as an e-book reader.

Think I’m crazy? consider these random bits of recent information. We know that the iphone 3.0 SDK contains placeholders for several devices that apple hasn’t released or even acknowledged yet. Also, there is some evidence that Apple has recently partnered with LG for the delivery of new larger OLED touchscreens which are brighter and more power efficient than traditional LCD displays and don’t match any product in Apple’s current lineup. Finally, there are rumors that AT&T is busy upgrading its 3G network, increasing transfer rates and preparing for a summer roll-out.

When you ask the question, what would be cooler and ultimately more attractive to consumers than a $400 netbook? I think it just might be a $99 3G enabled iPod with a larger screen. It could deliver an “internet anywhere” experience for email, websurfing and entertainment, the kinds of activities netbook users interested in. It also wouldn’t cannibalize iPhone sales, since it wouldn’t contain voice capability and it wouldn’t jeopardize Apple notebooks because it doesn’t compete with them, running only the iPhone OS and apps from the app store. It wouldn’t compete in the netbook space. It would shatter it instead and give Apple a device nobody has an answer for.

I think it would be brilliant, and I think I would want one. I also think I wouldn’t be alone.