Apple is absolutely terrified of eroding tablet margins:

One major reason for
Apple's earnings decline in the past two quarters lies in the tablet category. After the
iPad mini launch, consumers have flocked to the cheaper and smaller iPad
en masse, driving down Apple's tablet margins. And today we found out just how much this concerns
Apple. Despite the fact that
Apple's tablet market share has dropped from 60% to 32% in just a year, the company now absolutely rejects the idea of defending market share.
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