The early-morning lines outside stores in Silicon Valley and across the world were uncharacteristically short for an Apple launch, a sign perhaps that Apple fanboys and fangirls are growing weary of hyped product upgrades and that the iPad's sexiness may have diminished since the first tablet hit stores two years ago. Since then, competitors have emerged with 7-inch tablets priced more than $100 cheaper, and some
Analysts project modest sales for the Mini this weekend, and customers showed little interest in the fourth-generation iPad, also released on Friday. Lingering customer backlash for the newest full-size tablet, announced just seven months after the third generation hit stores, likely contributed to the disinterest and possibly Apple's still-falling stock price, which hit a new three-month low Friday.
By 7:30 a.m. Pacific time, a half-hour before the Palo Alto store opened its doors, about 35 customers had lined up -- a fraction of the number who scooped up the third-generation iPad on launch day.
Brad Peterson of Los Altos was first in line at 2 a.m. When he saw the empty sidewalk outside the Apple store on University Avenue, he thought he had the wrong day.
"I go to these things all the time, and (2 a.m.) usually gets me somewhere in the middle of the line," he said.
So he pulled out his iPad -- third-generation -- to confirm the date, and with a quick Google (GOOG) search discovered that turnout was low at stores across the world. Reuters reported that crowds waiting for the newest iPad were smaller than for previous launches from Sydney to New York City, with staff at the Hong Kong Apple Store appearing to outnumber customers waiting in line.
Jeff Wang turned around and went home after he found the University Avenue store deserted at 10 p.m. Wednesday night. Wang, of Saratoga, came back at 2:30 a.m. to secure the second spot in line, bewildered that there weren't already hundreds waiting by that hour.
"The last couple times I came around 11 p.m. the night before and the lines were long," Wang said.
Their early arrival was good for neighborhood coffee shops -- employees at the Starbucks down the street said they had more customers than usual, and several were in the door just after it opened at 4:45 a.m.
The iPad Mini is Apple's answer to popular 7-inch tablets like Amazon's Kindle Fire and Google's Nexus 7. But Apple priced its smaller tablet entry much higher than those competitors -- the device starts at $329, while other 7-inch tablets can cost as little as $199.
For some customers, more of a turnoff than the cost is that Mini is now only available on Wi-Fi; the company will release a version that connects to cellular networks in a couple weeks, when some expect to see an uptick in sales.
Analysts doubt Apple will perform as well with this launch as it has previously, with Piper Jaffray analyst Gene Munster -- an Apple bull who typically offers the highest projections for Apple sales -- forecasting opening-weekend sales of about 1 million to 1.5 million for the iPad Mini. Apple sold 3 million third-generation iPads in the launch weekend for that product in March.
BTIG Research analyst Walter Piecyk said the sales total Munster predicted would be a disappointment, proclaiming that Apple needed to surpass the opening weekend sales of the third-generation iPad to claim a success.
"We believe Apple's first weekend sales of the iPad Mini needs, at a minimum, to top the 3 million first weekend sales of the iPad 3 in order to demonstrate that the management team can execute on ramping supply of new products and to provide some evidence that there is adequate demand for a smaller iPad at these price points," he wrote in a note Friday morning.
But lower sales projections didn't dampen the excitement among the die-hard fans who cheered when the Palo Alto store opened its doors two hours early for the event. Many walked out of the store minutes later with a grin and two Minis -- the limit for each customer. Peterson said he the Minis were an early Christmas gift for his two teenage daughters -- although he had a few hours to play with the tablets while the girls were in school.
"December 25 is pretty arbitrary," he said. "Apple decides when Christmas comes in our house."
Most of the early customers were men, and like Peterson, most said they were there to buy Minis for their children and wives -- but would take the new technology for a test drive before gift wrapping it. Some analysts have said Apple likely scheduled the fall release to compete with other new tablets, such as Microsoft's Surface, which hit stores last week, for the holiday season.
Friday was the first launch event at the new Apple Store in cofounder Steve Jobs' town, a sleek and dramatic space that opened Saturday just a block and a half away from the previous Palo Alto Apple Store. It was also the first Apple launch event for Christian Lindholm of Finland -- the startup developer couldn't resist picking up a couple Minis while in California on business.
"I have to do it in Silicon Valley," he said. "This is the store to do it. It's the grandfather store; sort of in Steve's hood."
There was some commotion back home in Finland when the Mini was released nine hours earlier, but nothing compared to the "theater" that Apple put on in its hometown, he said.
Like others at the store, he owns a third-generation iPad and won't be buying the fourth anytime soon. Several customers said they were unimpressed with the upgrades and unwilling to pay another $500 to $700 just months after the previous version was released.
"It doesn't feel like a fourth generation. It feels like a 3.2," Lindholm said.
Lower opening-weekend sales could help Apple avoid disappointing consumers with sellouts prompted by production delays, however. When the iPhone 5 debuted in September, Apple sold a record 5 million of the devices in the first weekend, but still couldn't meet demand. Analysts reported that Apple faced problems building and delivering enough of the devices to meet demand, and Apple's booming stock price began trending down.
Apple's Wall Street struggles have yet to stop, continuing Friday morning. The Cupertino company's shares hit their lowest level since July 27 and were trading at $582.03 at 11:30 a.m. Pacific time, a daily decrease of 2.4 percent; shares declined 14.9 percent between the iPhone 5's debut on Sept. 21 and Thursday's close.
Staff writer Jeremy C. Owens contributed to this report.