"It's about the services - what you can do with the device," she said.
Apple's competitors have slowly come to realise this, but only after bringing out dozens of tablets with whiz-bang features like 3D cameras.
The competitor that's done the best is Amazon.com. Its Kindle Fire tablet is cheaper than the iPad, but what sets it apart is that it's tied into Amazon's book, movie and music stores, making it an easy route to entertainment, just like the iPad.
Still the Kindle Fire has a long way to go. Epps estimates that Amazon sold 5.5 million Kindle Fires in the fourth quarter of last year. Meanwhile, Apple sold 15.4 million iPads, and has sold 55.3 million in total.
According to Canaccord Genuity, 63 per cent of the tablets shipped last year were iPads. The only competitors with more than 5 per cent market share were Amazon and Samsung Electronics.
The iPad launch comes as Apple reached a rare milestone: last week, it was worth more than US$500 billion. Only six other US companies have been worth that much. One big unknown is whether Apple will keep the iPad 2 in production at a lower price, like it kept the iPhone 3GS after the launch of the iPhone 4. Another big unknown is whether Apple will reveal its rumoured foray into making TV sets.
iPad 3
Some of the rumoured new features include:
* A sharper screen, similar to the Retina display on the iPhone 4 and 4s.
* Some speculate that Apple will call the model the iPad HD, for "high definition" rather than iPad 3.
* Could include Siri, the voice-activated "assistant" found on the iPhone 4S.
* Faster wireless capabilities.
- AAP