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    Apple iPad Sales Cut into iPod, Not Mac Market, Analyst Says

    By
    Michelle Maisto
    -
    May 18, 2010
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      Swift Apple iPad sales have minimally affected sales of Mac computers. Some suspected sales of the new tablet-style PC might mimic the bite that netbooks took out of the laptop market. The iPad does appear, however, to be cannibalizing sales of Apple iPods to some degree, according to a May 17 report from Piper Jaffray analyst Gene Munster.
      But that news isn’t bad for Apple, Munster said. iPods retail for between $59 for the 2GB iPod Shuffle and $399 for the 64GB iPod Touch, while iPad pricing runs from $499 to $829. Given that, for Apple enthusiasts to choose the considerably more expensive device still amounts to a win for Apple.
      “From the early NPD data, it appears that the iPad has a minimal cannibalization impact on Mac sales, and could be slightly cannibalizing iPod sales,” Munster wrote. “Given the ASP (4x) and margin profile of the iPad, we see this as a net positive for Apple’s business.”
      NPD Group found iPod sales to be down 17 percent year-over-year in April-the iPad launched April 3-and has said it expects sales of 9 million to 10 million units for the June quarter. April Mac sales, however, were up 39 percent, and sales of 3.1 million to 3.2 million units are expected for the June quarter-which would amount to 19 to 23 percent year-over-year growth.
      “Apple has successfully limited the iPad functionality to primarily content consumption, versus content creation on a Mac,” Munster added. “And, relative to the iPod, the physical size of an iPad provides a meaningfully different value proposition (portability versus screen size).”
      Apple has said it sold more than 1 million iPads in the device’s first month on the market. In fact, sales were said to so exceed expectations that Apple was forced to make the “difficult decision” to delay the iPad’s international launch until late May.
      Sales of iPads and similar devices are expected to increase over the next several quarters. A May report from the Boston Consulting Group, based on international surveys of consumers, forecast that 50 to 75 percent of consumers will purchase a tablet device over the next three years. Further, BCG expects tablet devices to become “one of the most successful consumer electronic/tech products.”
      Verizon has said it is working on an Android tablet with Google, Dell has introduced the Dell Mini 5 tablet, Hewlett-Packard is rumored to be working on the HP Hurricane, a tablet running the Palm-developed WebOS, and Sony has recently said it’s considering creating a tablet of its own, once it’s confident that consumer interest is strong enough.
      BCG concluded that widespread adoption would be of multifunctional devices as opposed to single-function e-readers, and a drop in tablet prices will have to occur.

      Michelle Maisto
      Michelle Maisto has been covering the enterprise mobility space for a decade, beginning with Knowledge Management, Field Force Automation and eCRM, and most recently as the editor-in-chief of Mobile Enterprise magazine. She earned an MFA in nonfiction writing from Columbia University, and in her spare time obsesses about food. Her first book, The Gastronomy of Marriage, if forthcoming from Random House in September 2009.

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