Pricing of new, smaller iPad well above the competition

On Tuesday, the company revealed the iPad Mini, with a screen that's about two-thirds the size of the full-size model, and said it will cost $329 and up.

Apple starts taking orders for the new model on Friday Oct. 26, said marketing chief Phil Schiller at an event in San Jose, Calif. Wi-Fi-only models on Nov. 2. Later, the company will add models capable of accessing "LTE" wireless data networks.

The price fits into the Apple product lineup between the iPad 2 at $399 and the latest version of the iPod touch at $299. But company watchers had been expecting Apple to price the iPad Mini at $250 to $300 to counter the threat of less expensive tablets like Amazon.com Inc.'s Kindle Fire, which starts at $159. Barnes & Noble Inc.'s Nook HD and Google Inc.'s Nexus 7 both start at $199.

The screen of the iPad Mini is 7.9 inches on the diagonal, making it larger than the 7-inch screens of the competitors. It also sports two cameras, on the front and on the back, which the competitors don't.

The iPad mini is as thin as a pencil and weighs 0.68 pounds, half as much as the full-size iPad with its 9.7-inch screen, Schiller said.

The screen resolution is 1024 by 768 pixels, the same as the iPad 2 and a quarter of the resolution of the flagship iPad, which starts at $499.

"It's not just a shrunken-down iPad, it's an entirely new design," Schiller said.