Best Buy CEO Pulls Back from Notebook 'Cannibalization' Statement
After a report published in The Wall Street Journal last week quoting Best Buy boss Brian Dunn as saying Apple's iPad tablet was "cannibalizing" sales of notebooks and netbooks, Dunn issued a statement claiming his comments were inaccurately depicted.
In the original article, the WSJ reported Dunn saying sales of notebooks
were down by as much as 50 percent because of the iPad. Dunn did not specifically
address that statistic in his response. "Mr. Dunn also said internal
estimates showed that the iPad had cannibalized sales from laptop PCs,
especially netbooks, by as much as 50 percent," the original article read.
On Friday, Dunn released a statement, likening recent rumors of a pending decline in notebook and netbook sales to a legendary Mark Twain-ism. "The reports of the demise of these devices are grossly exaggerated," Dunn said. "While they were fueled in part by a comment in the Wall Street Journal that was attributed to me, they are not an accurate depiction of what we're currently seeing. In fact, we see some shifts in consumption patterns, with tablet sales being an incremental opportunity."
Dunn said during Best Buy's recent earnings call that the company believes computers will remain a very popular gift this holiday because of the very benefits they offer consumers. "That's why we intend to carry a broad selection of computing products and accessories to address the demand we anticipate this season," the statement concluded.
Whatever the true impact iPad sales are having on netbooks and notebooks in Best Buy stores, those two devices are likely to face increasing competition not just from the iPad but the burgeoning tablet market in general. A July report from a Barclays Capital analyst said Apple will sell about 20 million iPads in 2011, negatively affecting lower-cost notebooks as well as the netbook market. Other analysts have also suggested growth for the tablet PC market, with research firm IDC estimating that worldwide media tablet shipments will total 46 million units in 2014.
In addition, Samsung, Cisco, Toshiba and Avaya all have tablet computers coming to market; Samsung and Toshiba, with their Galaxy Tab and Folio 100 tablets, respectively, are following Apple into the consumer space, while Cisco's Google Android-powered Cius communications tablet and Avaya's Flare Experience tablet are aimed more toward the business world.
Apple remains well ahead of the competition at the moment, according to a report by research firm iSuppli. This year, the company said it expects the iPad to account for 74.1 percent of global tablet shipments, with the remaining portion going to "a mix of older PC-type tablet products and competitive slates."
In 2011, as the competition begins seriously filling out, iSuppli still expects Apple to command 70.4 percent of the market, and nearly two-thirds market share through 2012. At present, while a number of tablet devices are set to launch-running Windows 7, Android and WebOS-iSuppli said it believes none of these is ready to be a serious competitor to the iPad.