* iPad mini takes on smaller tablets by Google, Amazon
* Crowds thinner than normal in some cities
* New Yorkers line up despite transit, power woes
* Apple shares hit three-month low
By Liana B. Baker and Noel Randewich
NEW YORK/SAN FRANCISCO, Nov 2 (Reuters) - Apple Inc's iPad mini hit stores around the world on Friday, attracting sparser crowds than previous Apple launches, but the kickoff still drew hundreds of New Yorkers only days after one of the biggest storms to hit the United States.
A proliferation of rival gadgets aimed at the holidays and cheaper tablets from Google Inc and Amazon.com Inc may have sapped interest in Apple's latest bet, resulting in shorter lines outside stores from Tokyo and Amsterdam to Sydney and Hong Kong.
The 7.9-inch iPad mini marks Apple's first foray into the smaller-tablet segment, and is the company's first major new device since the death of its co-founder, Steve Jobs, last year.
In Manhattan, crowds braved crippled public transit and an early morning chill to line up outside Apple's Fifth Avenue flagship store just two blocks from where a damaged crane dangled from a high-rise building - a stark example of how superstorm Sandy ravaged the city.
Some turned up on impulse, lacking power and heat at home.
Lisa Sieber, 59, from Germany, rode a bicycle to the store because she said she was going "stir crazy" at her 81-year-old mother's home in Manhattan's Lower East Side.
"There's not much to do without power and lights," she said.
"I didn't think I needed an iPad but once you get your first Mac, you slide into the iPhone and the next one and it makes it easy to get more Apple products."
While the city was still grappling with Sandy's unprecedented devastation, some New Yorkers were angry that Apple delayed the store's opening until 10 a.m.
"Usually it's 8 a.m.," said Vincent Leroy, 27, a student from Long Island City in Queens who showed up at the store at 6:30 a.m. His friends complained loudly in unison when he told them he had found out about the delayed opening.
On the U.S. West Coast, fewer than a hundred people thronged Apple's new outlet in Palo Alto, California, near the company's Cupertino headquarters, and staff appeared to outnumber customers.
Shares of Apple, which hit an all-time high in September, slid as much as 2.7 percent on Friday to $580.14, their lowest level in more than three months. The shares were down 2.5 percent at $581.65 in late afternoon.
The iPad mini marks Apple's assault on the smaller 7-inch-plus tablet segment, hoping to beat back major inroads by Google's Nexus 7 and Amazon's Kindle Fire this year. It is the latest salvo in a global mobile-device war, with software giant Microsoft Corp angling its Windows 8-driven Surface tablet for the holidays.
Unveiled last week, the iPad mini has won mostly positive reviews but criticism centered on a heftier price tag and a screen considered inferior to those of rival gadgets like the Nexus 7. It replicates most of the features of its full-sized sibling.
Apple will likely sell between 1 million and 1.5 million iPad minis in the first weekend - far short of the 3 million third-generation iPads that sold last March in their first weekend, according to Piper Jaffray's Gene Munster.
"While launch lines and initial weekend sales may not be as impressive as previous iPad launches, the iPad mini will be a hit product for Apple and become a more significant part of the story over the next two to three quarters," Munster said.
The iPad mini is the first device to be added to Apple's compact portfolio under Chief Executive Tim Cook, who took over from Jobs months before his death a year ago. Analysts credit Google and Amazon for influencing the decision.
Some investors worry that Apple might have lost its chief visionary with Jobs, or that new management may struggle to stay ahead of the pack as rivals innovate and encroach on its turf.
Jobs launched the original iPad in 2010, which has since taken a big chunk out of PC sales. On Friday, Apple also began selling the fourth generation of that 9.7-inch device, much the same as before but with a faster A6X processor and better Wi-Fi.
Both devices hit stores across 34 countries on Friday.
HONG KONG, AMSTERDAM
When Apple's flagship Hong Kong store opened on Friday, staff appeared to outnumber those waiting in line. In Amsterdam two hours after the store opened, it looked like a typical day, with no lines outside. An Apple employee told Reuters that people had lined up ahead of the store opening.
There were queues of 100 or more outside Apple stores in Tokyo and Seoul when the device went on sale. But fewer people turned up in Sydney than for previous iPhone launches.
"It's so thin and light and very cute - so cute!" said Ten Ebihara at the Apple store in Tokyo's upscale Ginza district.
Reviewers have applauded Apple for squeezing most of the iPad's features into a smaller package that can be comfortably manipulated with one hand. But at $329 for a Wi-Fi-only model, the iPad mini is a little costlier than predicted, though some analysts see that as Apple's attempt to retain premium positioning.
Some investors fear the gadget will lure buyers away from Apple's $499 flagship iPad, while proving ineffective in combating the threat of Amazon's $199 Kindle Fire and Google's Nexus 7, both of which are sold at or near cost.