Analyst Opinion by Michelle Grant - Travel and Tourism Manager
Critics have been vocal about the iPad business lagging due to its slowing sales growth and an outright decline in units sold in the latest 2014 quarter. But I wonder if Apple is looking to combat the business’ weakness by making the iPad a must have travel accessory, which could spur demand for the product and could speed up replacement cycles if iPads are lost, stolen or broken during trips. Its TV ad campaign from early in 2014 featured travel pretty heavily. And I’ve been surprised by how many people use their iPads to take photos on their trips (it may have an advantage for those with poor eyesight). Now the new iPad Air 2 is thinner and faster with a better camera—all ideal for travel. The Verge highlights these features:
iPad Air 2 is the thinnest iPad to date at 6.1 millimeters, or 18 percent thinner than the original iPad Air. The new A8X chip is 40 percent faster than its predecessor, and Apple says the device’s graphics are 2.5 times faster. The rear camera is 8 megapixels and significantly improved over its predecessor, able to shoot slow-motion video and time lapses for the first time. And the front camera has improved face detection and a "burst selfies" mode.
But the most interesting thing that analysts are taking note of is the new SIM card. From Apple’s press release about the iPad Air 2:
The new Apple SIM is preinstalled on iPad Air 2 with Wi-Fi + Cellular models. The Apple SIM gives you the flexibility to choose from a variety of short-term plans from select carriers in the U.S. and UK right on your iPad. So whenever you need it, you can choose the plan that works best for you — with no long-term commitments. And when you travel, you may also be able to choose a data plan from a local carrier for the duration of your trip.
The ease of switching between carriers while travelling with your Ipad enhances the products’ appeal as a travel accessory. Already savvy travellers swap out SIM cards, but it can be difficult to find an appropriate SIM upon arrival and infrequent leisure travelers may not be aware of this option. But now those traveling to the US and the UK can switch to a carrier upon landing and avoid paying high roaming charges. Both countries attract a significant number of international travellers. The US is the second most popular destination for international arrivals in the world with 69 million trips in 2013 while the UK ranks eighth with 32 million arrivals according to Euromonitor International.
If the geographic coverage of carriers expands, this would only enhance the iPad Air 2’s appeal for international travellers. This speaks to Apple’s desire to provide the best user experience (and now probably travel experience), but the company may also be at the leading edge of a truly borderless telecommunications industry. For example, the European Commission is keen to eliminate roaming fees within the European Union although there could be delays as reported by RC Wireless:
In addition, the possible delay of the end of roaming fees would allow carriers to hang on to that source of revenue for as long as a year. Originally, the proposed start of the “roam like at home” policy, or RLAH, was December 2015. However, that date does not appear in the draft proposal. Instead, the document throws the date open for debate: “The legislative date for the initial introduction of RLAH, subject to transitional measures and fair use limits, needs to be defined and is a significant political question.”
Travellers within the European Union, the largest travel market in the world, will soon be able to use their phones in other EU countries without incurring additional, and usually exorbitant, fees. And with the new SIM card for the iPad Air 2, Apple may be on the verge of making it easier to shop for the appropriate mobile carrier while travelling globally. This would be especially impactful if this feature was rolled out to the iPhones (but may undermine the need for the iPad as a travel accessory), but it is likely that the carriers may balk at allowing more transparency and comparison ability to their industry (leaving the advantage with the iPad). Regardless, it seems that Apple is looking to make the iPad as necessary as a passport when travelling abroad.
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