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Lingering iPad Question: Who Gets to Sell It?

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Woo hoo! Now we know when we get to buy the iPad. However, we haven’t been told where we get to buy it. Of course the Apple (s aapl) Stores (both online and off) will carry it, but the end of the press release has a cryptic statement that the iPad will be sold at select (emphasis added) Apple Authorized Resellers.

That probably means not every place that can sell Apple products will be allowed to sell iPads. This is a curious position for Apple and its distribution strategy. Which model does it choose?

Let’s take the iPhone. It’s very limited in distribution. Apple and AT&T (s att) controlled sales at the beginning and then eventually allowed places such as Wal-Mart and BestBuy to carry it. Apple COO Tim Cook confirmed BestBuy would sell the iPad but didn’t say who else would have that capability. Logically, anywhere you can buy an iPhone you should be able to buy an iPad, right?

What about any place you can buy an iMac? Only time will tell, but here is what I think will happen. Cue the special effects.

First to get the iPad will be campus bookstores. Education is a key market and I’m sure many parents want to give iPads to their kids before they go off to college. Traditionally in the fall Apple has promotions for education consumers that give away a free iPod when you buy a Mac. That might fall by the wayside to be replaced with a discount deal on an iPad. Most likely the iPad 3G won’t be sold there because campuses already have wireless and campus bookstores won’t have the staff to deal with the nuances of selling AT&T wireless service.

AT&T stores will obviously carry the iPad 3G, but probably not the iPad Wi-Fi. Space is at a premium at AT&T stores and the margins on the iPad are going to be relatively low. I’m going to conjecture it will allow you to buy the iPad without buying a data plan, but will do a hard sell for it. I don’t think AT&T will discount the iPad if you buy a data plan however.

Apple Specialists, who according to Apple “are independent Apple Dealers and Service Providers with a strong commitment to the Mac platform” have also been unofficially slated to sell the iPad Wi-Fi. The Specialist I spoke with could neither confirm nor deny the rumor, but simply smiled at me, which is a good sign. I doubt they’ll get the iPad 3G. Many Specialists often have retail locations that could compete with sales at AT&T locations. Apple will want to protect the AT&T stores as much as possible.

Traditional catalog retailers will also get the iPad Wi-Fi. These places already sell the entire Apple product line except for the iPhone. Unlike the other channels, I think Apple will experiment with allowing these resellers to sell the 3G versions. Catalog companies often sell mobile phones so they have the support to deal with this type of sale. Apple will want to directly compete with the other netbook offerings from these resellers and will want the iPad 3G sales from these vendors.

Left up in the air are the places you can buy an iPod and iPod touch, but not a Mac, such as department stores and even vending machines. These retailers probably won’t be invited to the iPad party. To keep Apple’s brand image going strong, Apple will want some degree of exclusivity as to who gets to sell the iPad. Too many returns and salespeople who aren’t properly trained could sour people on the Apple brand. iPads won’t be sold in vending machines like iPod nanos.

Not mentioned in the press release is the role of the highly profitable AppleCare for these devices. Anyone who sells AppleCare will be able to sell AppleCare for the iPad, but pricing will likely be more expensive than for an iPod or iPhone.

Where do you think you’ll be able to buy an iPad?

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24 Responses to “Lingering iPad Question: Who Gets to Sell It?”

  1. Think it would be a great idea. Some people don’t have the outright cash to pay for the item and can use their bestbuy card or credit card especially in our financial down time. They can also apply for one where the credit check is somewhat soft. Also, bestbuy carries a Geeksquad Black Tie protection that covers accidental damage and it maybe available for the iPad. Apple care never covers accidental.

  2. I work for an Apple Specialist and it doesn’t look like we’re going to be able to sell it, at least not right away. From what I’ve heard, only larger Specialists will be getting it. We’re a pretty small store with only one location. I believe that if you have multiple stores or do a certain amount of revenue then you will be able to sell it. Totally sucks for my store though…

  3. Handsome Stranger

    I want to see the iPad for sale at all those places with the RedBox that rents those DVDs.

    Apple Kiosk FTW !!!

    P.S. They already have these at some airports.

    Would be nice to see them for sale at Denny’s and McDonalds too.

    You want fries with that iPad sir ?

  4. It’s hard to believe that Best Buy would meet the requirement of “answering questions,” in Tim Cook’s words. Despite all the attention, even with all the staff training, and even considering some motivated employees, Best Buy is still way down the ladder. I think where Apple wants to use resellers is in other countries, especially in Europe, which has a particularly strong group of Apple Premium Resellers. Hey, Steve created the stores to get away from the resellers, not to give them more to sell.

    • Curtis

      The Apple section at our local Best Buy (table selling iMacs and Macbooks etc) is overseen by an actual living breathing Apple employee. He was quick to pull the badge on a string from his uniform to show me. I guess he is tired of feeling like everyone thinks he is “just” a Best Buy employee. So I don’t think Best Buy will have problems fielding iPad questions.

  5. I own an iPhone 3G, and I plan on jailbreaking and unlocking it, and then selling it when the next-gen iPhone comes out (I’ll use the money I get from selling my current iPhone 3G). So, since I will eventually have the most up to date iPhone, is there anything else that I need that the iPad would give me? It seems cool for someone who doesn’t have an iPhone, but what else does it offer if I own one? Will iBookstore be out for iPhone?
    weider x factor

  6. Rick Doyal

    I’ll let you guys in on another little secret. (promise not to share). If you type iPad into Google you’ll see an Adword on the right that says all you hafta do is take a little survey and they’ll give you a freakin iPad!!

    I’m on hour #2 right now. Boy – they wanna know everything! Where I was born, my moms maiden name, birthdate, social security number, home address, my next vacation date, where we usually hide keys (duh! Right above the door frame! Everybody does that so I don’t mind sharing)

    Oh crap! Now they want me to wire them a $1000! Ah, not to worry – it says right here that they’re not really gonna cash it. It’s just how they protect themselves from people scammin them. Well – everything looks legit, sit back and wait for my free iPad!

    Will ship in 4 – 6 months! WTF!!

  7. No one with business sense thinks Amazon wouldn’t get it.

    Of course, they’d be able to compare sales vs. the (unreleased numbers) Kindle side-by-side.

    Would Apple enjoy that? You betcha.

  8. Boupierre

    What will be interesting is how distribution plays out outside of the USA. For example, in Canada, the iPhone is carried by all of our cell phone carriers. Will this be continued for the iPad? What will be the price level? If all carriers have the same price point, does that create issues re: collusion and price fixing. This is likely why the iPad’s release is being delayed outside of the USA – more complex negotiations are required.

  9. adam jackson

    Best buy is all that comes to mind. Will Amazon sell it? That’s the question. California 9.5% sales tax sucks and I like to buy a lot of things on Amazon.

    • adam jackson

      @Omar – It’s insane! Amazon Prime ($79 a year) makes most things on their site have free 2-day shipping.

      So avoiding tax and free two day shipping saves me tons of cash. I buy everything, even groceries on Amazon these days and get it the day after tomorrow. Pretty cool.

      I hope they sell the iPad but that’s unlikely.

    • Legally, we Amazon shoppers in California still need to pay the sales tax. We’re required to list items we buy outside the state and pay up. Not sure how many do, though.