Apple's Tim Cook: iPad Cannibalization Good for PC Industry

Apple CEO Tim Cook used a Feb. 14 keynote at the Goldman Sachs Technology and Internet Conference in San Francisco to offer some insights into both the iPad and the tablet industry as a whole.

After praising the iPad’s effect on the tech industry overall, Cook suggested that quality, and not a low price, is ultimately what drives unit sales. “Price is rarely the important thing,” he said, according to an edited transcript provided by Fortune. “I think people at the end of the day, they want a great product.” He suggested that Amazon’s Kindle Fire, a $199 tablet designed primarily for streaming content and ebooks, would ultimately sell a lot of units—while adding that “the customers that we’re designing our products for, are not going to be satisfied with a limited function kind of product.”

Cook also took a gentle swipe at other manufacturers’ tablet efforts. “What happened last year, everyone that was in the PC industry and everybody that was in the phone industry, everybody decided they had to do a tablet,” he said. “Everybody was kind of aiming at iPad 1, and we were trying to innovate quickly to get to iPad 2. So, by the time they had something that they thought could compete with iPad 1, we were on iPad 2.”

From there, Cook tackled a much-discussed topic in recent quarters: whether or not the iPad is cannibalizing sales of traditional PCs. “I think that iPad has cannibalized some Mac sales,” he conceded. “And the way that we already view cannibalization is, we prefer we do it than have somebody else do it.” Because of that, he added, “We never want to hold back one of our teams from building the absolute greatest thing, even if it takes some sales from another product area.”

However, he saw tablets as ultimately beneficial for the tech industry as a whole.

“I think it’ll be good for the PC industry, because they’ve got this strong competitor, and I think it’ll be good for tablets, because they’ll innovate like crazy over here,” he said. “And I do think that, out of that, there will still be a strong PC industry. I just think the tablet industry is going to be larger in units than the PC industry.”

According to the ever-buzzing rumor mill (sparked by a Feb. 9 report in AllThingsD), Apple’s next iPad will make its debut at the beginning of March. Other sources have widely speculated that the device will feature a next-generation processor, a high-resolution “Retina Display,” and support for 4G LTE (Long-Term Evolution). 

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