Apple Ships 500,000 iPads, Supply Gets Squeezed
Apple said April 14 that it had delivered more than 500,000 iPads during the tablet PC's first week of general release, exceeding the company's internal predictions. The demand reflected by those sales, coupled with "a large number of preorders for iPad 3G models for delivery by the end of April," has led to a postponement in the iPad's international launch.
"We know that many international customers waiting to buy an iPad will be disappointed by this news," read a statement posted on Apple's Website, "but we hope they will be pleased to learn the reason-the iPad is a runaway success in the United States thus far."
Apple had previously announced, during an April 8 news conference at the company's Cupertino, Calif., headquarters, that about 450,000 iPads were sold in the first five days. During that conference, Apple CEO Steve Jobs also said about 600,000 iBooks and 3.5 million applications had been downloaded by new iPad owners. Those 450,000 iPads included the 300,000 units sold by midnight on April 3, the device's first day of general release.
According to a March 29 research note from Morgan Stanley, Apple could ship as many as 8 million to 10 million iPads in 2010, and sell around 2 million of those. "Near-term, we believe the iPad will target the sizable sub-$800 consumer notebook market, which equates to 30 million units in the United States and 120 million units globally," analyst Katy Huberty wrote. A robust application ecosystem, paired with strong interest in TV shows and e-books offered specifically for the iPad, could potentially increase the device's sales momentum.
Research company iSuppli has also suggested that Apple could sell as many as 7.1 million iPads in 2010.
Blogger and analyst Daniel Tello, in conjunction with members of InvestorVillage's AAPL Sanity forum, calculated in early March that Apple might have sold 120,000 iPads during the device's first day of preorder availability, March 12, and that 69 percent of preorder customers were gravitating toward the WiFi-only version of the device.
Apple will face a wide variety of tablet PC competitors later in the year, including a device by Hewlett-Packard that features a combination of inward-facing VGA Webcam and outward-facing 3-megapixel camera for video conferencing and image-taking. The HP Slate will retail for between $549 and $599, and will run Windows 7. Similar devices, including a much-rumored Google Android tablet, may also try to make a competitive differentiator out of featuring a camera module, which is not included in the current version of the iPad.
The iPad may also run the risk of breakability. In an April 9 e-mail to eWEEK, Aaron Vronko, co-founder and service manager of Michigan-based Rapid Repair, predicted that 5 to 10 percent of the devices would fail due to "accident-related causes" each year.
"Physics are not in the tablet's favor," Vronko wrote. "While the fragile parts of the iPad are no less durable than their iPhone counterparts, a 10-inch and 24-ounce device is just a much bigger target for accidental collisions and generates many times more force in a fall." Competing device manufacturers, however, do not have access to the voluminous life-cycle data from the iPhone and iPod Touch that Apple could use to make the iPad more durable.