"They're not going to be the only [tablet] player in the back half of the year, so are they going to be the first mover on price? It would give them an advantage."
Still, Baker said the chance that Apple would drop the entry-level iPad price to, say, $399 -- a 25 per cent cut -- was between slim and none. "Clearly they're not ready to compete at the low end" on price. Maybe they'll take a little bit off by the holidays. But I don't think they're willing to take that shot right now," Baker said.
Apple could also beat the competition to the punch by expanding the iPads sales channels now, rather than wait until later in the year, when rival tablets actually ship.
"Just like the iPod, the more places you are [with the iPad], the more aggressive you are, the more opportunities you have," Baker said.
He suggested that Apple push the iPad in retail locations where it doesn't currently appear, and boost its efforts in the business market.
"It's time for Apple to think about being more aggressive in business channels, like the office supply stores, and [direct market resellers like] PC Connection and Insight," said Baker. "And more aggressive in second-tier retail, such as regional consumer electronics chains, and test alternatives like Kohl's or Bed Bath & Beyond."
Apple currently sells the iPad at its own retail and online stores, authorized resellers, through AT&T and Verizon, and at retail outlets including Best Buy and Wal-mart.
"It's time for Apple to start thinking of the competition," concluded Baker, "because those other [tablet] guys will be aggressive."
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