Apple to Begin Production for iPad 3 Release: Report

Now that Apple has launched its iPhone 4S to record sales, the focus is perhaps shifting toward the company's next release -- the iPad 3.

There's talk that the iPad 3 will hit production this quarter and talk of a new smaller iPad tablet that may be on the way from Apple -- the iPad mini.

There is considerable debate over whether the reported mini is actually smaller or cheaper, however. Apple's late co-founder and long-time CEO Steve Jobs once said he wasn't a fan of small tablets. Yet as Amazon prepares to launch a 7-inch tablet that appears set for industry success as CEO Tim Cook leads the company, some wonder if Apple hasn't changed its thinking.

Regardless, there is consensus that Apple's iPad mini will at the very least be a cheaper version -- allowing the company to offer competitive tiered tablet pricing like it is doing with its globally-popular iPhone series.

Apple revealed with its iPhone 4S launch that the company is focused on keeping its global girth -- the iPhone is the world's bestselling smartphone while the iPad is the world's bestselling tablet -- through tiered pricing that makes the products more affordable to the masses.

With the iPhone 4S, pricing begins at $199 (with a two-year contract) for the model with 16 gigabytes of storage. Apple has also dropped the price of its iPhone 4 to $99 (with a two-year contract), while its iPhone 3GS is free with a contract.

A report says the iPad 3 is nearing production, and that model is expected to be at the top of the pricing tier. Apple iPad pricing currently starts at $499. Apple will build 600,000 to 1 million iPad 3 units this quarter, estimates Susquehanna Financial analyst Jeff Fidacaro, according to All Things Digital.

The Kindle Fire is priced at $199, leading some to suggest that Apple won't sit back and yield that space without a competitive product -- thus, talk of the iPad mini. Analyst Brian White of Ticonderoga Securities suggests the mini may refer to the pricetag and not the size. He said Apple's mini tablet could be priced in the mid-to-high $200 range.

If so, Apple would offer tiered pricing with the iPad in the wake of Amazon's release of the Kindle Fire tablet. Fidacaro told All Things D said the Apple iPad 3 will likely launch in March -- one year after the iPad 2 went on sale on March 11 of this year.