iPads face toughest holiday season yet

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Apple Inc. unveiled an updated version of its iPad Mini recently. (AP) Apple Inc. unveiled an updated version of its iPad Mini recently. (AP)
SummaryApple still holds largest chunk of growing tablet market, iPad has been losing market share to quality.

reality is they're going to have a real good fourth-quarter, they're going to have great average selling prices compared to their competitors and that's going to be great for their profits and great for the Street too.''

Cook in his comments Monday emphasized that his company isn't just focused on how many iPads it sells in comparison to its rivals, saying that Apple also looks at things like customer loyalty and usage rates.

Mainelli noted that because Apple keeps its prices high, it's much more profitable than other tablet makers who try to boost unit sales by keeping prices low. As a result, Apple makes significantly more on each tablet it sells.

Shawn DuBravac, chief economist for the Consumer Electronics Association, said there should be plenty of demand to go around. His group expects U.S. fourth-quarter tablet sales of 40.1 million units, marking a 21 percent increase from a year ago. According to CEA research, about 26 percent of consumers plan to buy a tablet as a gift this year, roughly the same as last year's 27 percent.

DuBravac noted that the tablet market has fragmented in recent years, much like the personal computer and digital camera markets did as they matured. Consumers can now choose from among a wide variety of prices, sizes and options when shopping for a tablet, which boosts overall interest in the products, he said.

iPad competitors set to hit the market this month include Samsung's Galaxy Note 10.1 _ 2014 Edition, which is one of the few that costs more than the iPad Air. Its 16 gigabyte version starts at $550. But Amazon.com's Kindle Fire HDX, which like the Samsung tablet runs on the Android operating system, starts at $299.

Meanwhile, Microsoft has put a big marketing push behind its Surface 2 and Surface Pro 2 tablets, which start at $449 and $899, respectively. The tablets are aimed at business professionals and could attract buyers who want access to Windows 8.1 and Microsoft Office applications, something iPads and Android tablets don't offer.

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