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Apple calls tablets "the mother of all markets," Mac cannibalization not a concern

post #1 of 42
Thread Starter 
The iPad is "the poster child of the post-PC revolution," according to Apple CEO Tim Cook, who expressed no concerns about the company's industry-leading tablet undercutting sales of the Mac platform on which Apple was founded.

iOS lineup
Apple's iPad mini, iPad, and iPhone.


Due to a combination of supply constraints and an admitted level of cannibalization due to the iPad, Apple's Mac sales dropped 17 percent last quarter, with the unit posting its lowest numbers in some time. Cook remains unperturbed by such figures.

"If you look at when we came out with the iPad, what did people worry about? They worried, 'Oh my god, you're going to kill the Mac,'" Cook explained. "The cannibalization question raises its head a lot. The truth is: we don't really think about it that much. Our basic belief is: if we don't cannibalize, someone else will."

Cook reiterated a position he espoused late last year: that the firms that have the most to worry about with regard to cannibalization by the iPad are Windows PC makers, not Apple.

"In the case of iPad particularly, I would argue that the Windows PC market is huge and there's a lot more there to cannibalize than there is of Mac, or of iPad."

iPad sales have over the last two years solidly outperformed a contracting PC market, making Apple the top PC manufacturer when tablets are counted. Cook was quite cognizant of that fact in the interview.

"If you look at the full year last year, there were more iPads sold than [market leader Hewlett-Packard] sold of their entire lineup," Cook said. "I think we're in the early part of this game. The projection is that the [tablet market] will triple in four years."

"I think if a company ever begins to use cannibalization as a primary ? or even major ? factor of what products to go to, it's the beginning of the end."The Apple CEO went on to discuss what he sees as the future of the post-PC market. The tablet sector, he said, will be huge: "the mother of all markets," in fact. Developing markets such as Brazil and China ? where the iPad mini debuted to high demand ? represent a considerable opportunity for Apple, Cook opined.

"You would find that over 50 percent of the people in countries like China and Brazil that were buying an iPad don't own an Apple product," he said. "This is a huge thing for us to go out and show people what Apple is and introduce them to the company."

That ability to bring in new customers tends to pay off for Apple, Cook noted, as new customers tend to come under the influence of Apple's "halo effect": the notion that, once a consumer has bought an Apple product, she is more likely to buy another Apple product in a different category.

"Through the years, we've found a very clear correlation between people getting in and buying their first Apple product and some percentage of them buying other Apple products."



On the whole, Cook was skeptical of the importance of cannibalization, except possibly as a metric for a company's future success. The trick, he said, is not to dwell on it

"I think if a company ever begins to use cannibalization as a primary ? or even major ? factor of what products to go to, it's the beginning of the end."
post #2 of 42
"When the Mac first came out, Newsweek asked me what I [thought] of it. I said: Well, it’s the first personal computer worth criticizing. So at the end of the presentation, Steve came up to me and said: Is the iPhone worth criticizing? And I said: Make the screen five inches by eight inches, and you’ll rule the world." ~ Alan Key, circa 2007

"There is no rule that says the best phones must have the largest screen." ~RoundaboutNow

 

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"There is no rule that says the best phones must have the largest screen." ~RoundaboutNow

 

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post #3 of 42
"I think if a company ever begins to use cannibalization as a primary %u2014 or even major %u2014 factor of what products to go to, it's the beginning of the end."

Great line. And I agree.
post #4 of 42

I don't think a rational person can argue that we're in a post-PC era and worry about cannibalization of the Mac line at the same time.  Reading between the lines, this is what Cook is saying.  Fact: Many people only need a device that will allow web surfing, check email, pay bills, etc.  The need for a personal computer in the traditional sense just isn't there like it was before. 

 

He's spot on about the "halo" effect, too, and what other tech manufacturer has this?  No one that I can think of.  Over a year ago, I owned zero Apple products, didn't want any.  My oldest daughter wanted an iPod Touch and I gave in.  18 or so months later, we're up to something like 11 Apple products in the household.  I'm not bragging or boasting, just proving his point.

post #5 of 42

Another great line on 9to5 but not here, Cook said "I have no idea what market share is, because we’re the only company that reports what we sell.”

 

One of the most awesome things I've read today!

post #6 of 42
Apple was founded on the Apple I/II not the Mac.
post #7 of 42
This is what I call forward thinking and caring about the company, not just to the next quarter.
post #8 of 42
Quote:
Originally Posted by allenbf View Post

Another great line on 9to5 but not here, Cook said "I have no idea what market share is, because we’re the only company that reports what we sell.”

Good point there!
post #9 of 42
Quote:
Originally Posted by allenbf View Post

He's spot on about the "halo" effect, too, and what other tech manufacturer has this?  No one that I can think of.  Over a year ago, I owned zero Apple products, didn't want any.  My oldest daughter wanted an iPod Touch and I gave in.  18 or so months later, we're up to something like 11 Apple products in the household.  I'm not bragging or boasting, just proving his point.

Some will claim that only happened because Apple locked you in with their monopolistic iTunes Store. They'll ignore the fact that most people don't get the majority of their content from the iTS, or that it was Apple that wanted music to be DRM long before it happened way back in 2009, or that you can load your content into iTunes, or that there numerous apps that will let you load or play a massive amount of content without using iTunes at all. They'll do anything to deny that the HW and SW design has anything to do with making the user experience desirable.

"There is no rule that says the best phones must have the largest screen." ~RoundaboutNow

 

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"There is no rule that says the best phones must have the largest screen." ~RoundaboutNow

 

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post #10 of 42
Quote:
Originally Posted by SolipsismX View Post


Some will claim that only happened because Apple locked you in with their monopolistic iTunes Store. They'll ignore the fact that most people don't get the majority of their content from the iTS, or that it was Apple that wanted music to be DRM long before it happened way back in 2009, or that you can load your content into iTunes, or that there numerous apps that will let you load or play a massive amount of content without using iTunes at all. They'll do anything to deny that the HW and SW design has anything to do with making the user experience desirable.

 

Yep - but they can blame it on what they like - the reality is, I was completely blown away with the hardware, level of detail and the smoothness of iOS (I came from Android 3, so...yeah). 

post #11 of 42
Tim Cook talks much more than Jobs. Yet, he sticks to his talking points and repeats the same catch words again and again. Very disciplined. Apple's PR people must find life less interesting but calmer undr his regime.
post #12 of 42
Quote:
Originally Posted by AppleInsider View Post

"I think if a company ever begins to use cannibalization as a primary ? or even major ? factor of what products to go to, it's the beginning of the end."

Or NOT to go to. I really like Tim's view on cannibalization. 

post #13 of 42
Quote:
Originally Posted by paxman View Post

Or NOT to go to. I really like Tim's view on cannibalization. 

 

Likewise. A smart organization continues to 'skate to where the puck "will be", not where it's been'.

Proud AAPL stock owner.

 

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Proud AAPL stock owner.

 

GOA

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post #14 of 42
Quote:
Originally Posted by paxman View Post

I really like Tim's view on cannibalization. 

I don't know how other companies could possibly cannibalize the Mac or how Apple's iPad can cannibalize Windows PCs. I thought cannibalize meant one of your own products displaces one of your other products. I know what he meant, but the term used in that sense should not refer to other companies.

Life is too short to drink bad coffee.

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Life is too short to drink bad coffee.

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post #15 of 42
Quote:
Originally Posted by mstone View Post

I don't know how other companies could possibly cannibalize the Mac or how Apple's iPad can cannibalize Windows PCs. I thought cannibalize meant one of your own products displaces one of your other products. I know what he meant, but the term used in that sense should not refer to other companies.

I agree - but they're going to to eat them up irrespective of the lack of a correct term.

post #16 of 42
Originally Posted by AppleInsider View Post

"Our basic belief is: if we don't cannibalize, someone else will."
 

 

There ya go.  iPhone cannibalized iPod touch sales.  iPad is cannibalizing Mac sales.

 

It's all part of the process.

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post #17 of 42
Quote:
Originally Posted by mstone View Post

Quote:
Originally Posted by paxman View Post

I really like Tim's view on cannibalization. 

I don't know how other companies could possibly cannibalize the Mac or how Apple's iPad can cannibalize Windows PCs. I thought cannibalize meant one of your own products displaces one of your other products. I know what he meant, but the term used in that sense should not refer to other companies.

 

I don't think that cannibals eat their own tribe... i think that would be called ingest...

 

Kinda' reminds me of the old Hank Williams favorite --  The Cannibal Song:

 

 ♬ Today, I passed you on the street...

"...The calm is on the water and part of us would linger by the shore, For ships are safe in harbor, but that's not what ships are for."
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"...The calm is on the water and part of us would linger by the shore, For ships are safe in harbor, but that's not what ships are for."
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post #18 of 42

Wall Street has given Cook's presentation today a big thumbs down.  Talk about arrogance, ignorance, and incompetence all rolled into one.

 

Also got to love my posts getting deleted by coward mods/admin who can't take reality and defend the truth.  What are you, Tim's personal doggies?

post #19 of 42
Originally Posted by KingChael View Post

Also got to love my posts getting deleted by coward mods/admin who can't take reality and defend the truth.  What are you, Tim's personal doggies?

 

Let's see, insulting users of the forum, spreading FUD about Apple… pretty sure you know exactly why they were deleted.

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post #20 of 42
What Tim Cook had to say was very, very impressive and he only managed to drive the stock down $12. He's a real charmer, he is. If he keeps talking any more he can take the stock all the way down to $400. Is that a silken tongue or what? He should realize that no matter what he says it's going to sink Apple. Nobody actually believes him and I fully expect Apple's P/E to fall even further this year. That's the difference between Tim Cook and Jeff Bezos. Tim Cook can talk all day long and the more he talks, the further Apple will fall. If Jeff Bezos just clears his throat, Amazon stock will go up $20. Please, Tim Cook, put a sock in it. Whatever you're saying, Wall Street doesn't want to hear it and neither do Apple shareholders.
post #21 of 42
Wrong thinking like these Tim Cook thoughts are what are causing the Apple stock decline, and what will cause a major failure in the long term. To begin with, after reading this I'm no longer confident about how safe is to invest on the new Mac Pro when it's released.

I need a new computer because the supposedly "post PC" toys cannot run professional applications, nor can compile code either, and I need both. But investing >2000 dollars on a machine when the CEO considers such machine obsolete even before it's released doesn't look safe. Better put my money on professional computing makers.

Sorry Apple, but my days with you seem to be arriving to an end. Your "post PC" philosophy isn't based on technology which offers more performance than previous generations, but on the (wrong) belief that the "post PC" user doesn't need to run professional Adobe software. And that's wrong, we -need- to run professional Adobe tools, as well as from other pro vendors
post #22 of 42
Quote:
Originally Posted by Constable Odo View Post

What Tim Cook had to say was very, very impressive and he only managed to drive the stock down $12. He's a real charmer, he is. If he keeps talking any more he can take the stock all the way down to $400. Is that a silken tongue or what? He should realize that no matter what he says it's going to sink Apple. Nobody actually believes him and I fully expect Apple's P/E to fall even further this year. That's the difference between Tim Cook and Jeff Bezos. Tim Cook can talk all day long and the more he talks, the further Apple will fall. If Jeff Bezos just clears his throat, Amazon stock will go up $20. Please, Tim Cook, put a sock in it. Whatever you're saying, Wall Street doesn't want to hear it and neither do Apple shareholders.

 

 

Boy, you nailed it!   Tim is so powerful that he drove down AAPL, GOOG, NOK, IBM, BBRY... and the whole NASDAQ index.

 

Possible you should follow the last line of your advice to Tim.

"...The calm is on the water and part of us would linger by the shore, For ships are safe in harbor, but that's not what ships are for."
- Michael Lille -
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"...The calm is on the water and part of us would linger by the shore, For ships are safe in harbor, but that's not what ships are for."
- Michael Lille -
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post #23 of 42
Quote:
Originally Posted by mstone View Post

I don't know how other companies could possibly cannibalize the Mac or how Apple's iPad can cannibalize Windows PCs. I thought cannibalize meant one of your own products displaces one of your other products. I know what he meant, but the term used in that sense should not refer to other companies.

Depends on how you cast the net. There are animals that eat their own young (for various reasons) which I don't think anyone would deny as cannibalism. Then you have inter-tribal or exocannibalism which we define because they are eating their own species. I personally don't care for Cook's usage but I can see how the species could be defined as, say, the tablet market segment as a whole or CE market and all players just tribes so any shift in domination is the eating within that market segment.

Quote:
Originally Posted by Dick Applebaum View Post

I don't think that cannibals eat their own tribe... i think that would be called ingest...

There is evidence on at least 2 continents of tribes honouring their dead by eating them. This is known as endocannibalism. When someone dies you ingest them to make them part of you. Sounds reasonable to me. The best bits (muscles and fleshly organs) typically go to those higher up and the worst bit (brain and spinal cord) go to those lower down. The problem with this practice isn't the eating of the flesh but the spinal cord and brain where the disease Kuru can take hold. It's the same thing that causes Mad Cow Disease aka BSE aka bovine spongiform encephalopathy. It's an incurable degenerative neurological disorder formally known as transmissible spongiform encephalopathy. I think the practice — at least in regards to ingesting the brain and spinal cord — has been removed from the cultures that practice it.

Cannibalism comes from the "Spanish Canibales which is a variant of Caribes, the name of a West Indian people reputed to eat humans." However, there is no evidence that the Caribs actually ate humans.

The more formal name for this practice is anthropophagy with one who indulges in it known as an anthropophagus.

"There is no rule that says the best phones must have the largest screen." ~RoundaboutNow

 

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post #24 of 42

And now the media is running with an IDC report that claims a major slowdown in iPad growth.  With Business Insider proclaiming iPad business is collapsing.  How exactly does that square with Appe selling a record number of iPads this past quarter?  And how the hell do we know what iPad market share/growth is when no one else reports sales/shipment figures?

 

http://www.ubergizmo.com/2013/02/ipad-business-slow-down-analyst/

post #25 of 42
Quote:
Originally Posted by KingChael View Post

Wall Street has given Cook's presentation today a big thumbs down.  Talk about arrogance, ignorance, and incompetence all rolled into one.

 

Also got to love my posts getting deleted by coward mods/admin who can't take reality and defend the truth.  What are you, Tim's personal doggies?

Please go away.

post #26 of 42
Quote:
Originally Posted by Constable Odo View Post

What Tim Cook had to say was very, very impressive and he only managed to drive the stock down $12. He's a real charmer, he is. If he keeps talking any more he can take the stock all the way down to $400. Is that a silken tongue or what? He should realize that no matter what he says it's going to sink Apple. Nobody actually believes him and I fully expect Apple's P/E to fall even further this year. That's the difference between Tim Cook and Jeff Bezos. Tim Cook can talk all day long and the more he talks, the further Apple will fall. If Jeff Bezos just clears his throat, Amazon stock will go up $20. Please, Tim Cook, put a sock in it. Whatever you're saying, Wall Street doesn't want to hear it and neither do Apple shareholders.

That's why they have a choice called "sell" in financial markets. It also stops a condition called "whining."

post #27 of 42
Quote:
Originally Posted by anantksundaram View Post

That's why they have a choice called "sell" in financial markets. It also stops a condition called "whining."
Not sure if it stops whining, but for sure it stops companies with a wrong strategy.
post #28 of 42
Quote:
Originally Posted by KingChael View Post

Wall Street has given Cook's presentation today a big thumbs down.  Talk about arrogance, ignorance, and incompetence all rolled into one.

 

Also got to love my posts getting deleted by coward mods/admin who can't take reality and defend the truth.  What are you, Tim's personal doggies?

 

So because Tim didn't suck Wall Street's cock and grovel at their feet, that makes him ignorant and incompetent? That's your barometer for success, Wall Street's insctinctive response? That's what Apple should dictate their actions by? Do you think SJ gave a shit about Wall Street? Do you know how fucked Apple would be today, if it let Wall Street dictate their directions? Do you not realize Wall Stree's goal is to make short term cash, and Apple's goal is making the correct decisions for long term success and retaining brand value?

 

****, why are people like you even here? You clearly despise Apple, want them to fail, and have to pull shit out of your ass in order to attack them. I doubt you'd survive a day at Apple, yet you mock someone like Cook, who has an infinitely deeper understand of things than you ever will. 

post #29 of 42
Quote:
Originally Posted by allenbf View Post

I don't think a rational person can argue that we're in a post-PC era and worry about cannibalization of the Mac line at the same time.  Reading between the lines, this is what Cook is saying.  Fact: Many people only need a device that will allow web surfing, check email, pay bills, etc.  The need for a personal computer in the traditional sense just isn't there like it was before. 

 

He's spot on about the "halo" effect, too, and what other tech manufacturer has this?  No one that I can think of.  Over a year ago, I owned zero Apple products, didn't want any.  My oldest daughter wanted an iPod Touch and I gave in.  18 or so months later, we're up to something like 11 Apple products in the household.  I'm not bragging or boasting, just proving his point.


I don't know if you're into Home Automation systems and want or need a high end Home Automation solution, but Savant Systems is completely Apple and they have the absolutely slickest stuff on the market, but expect to have professionals install it.  I'm not at the point of calling someone in to install their products, but the second I can afford it and have a place I want to implement a high end solution, CALL THEM.   They do some SLICK stuff!!!!

 

Just giving you something to think about.........  These guys push the envelope in home automation.

post #30 of 42
Quote:
Originally Posted by Rogifan View Post

And now the media is running with an IDC report that claims a major slowdown in iPad growth.  With Business Insider proclaiming iPad business is collapsing.  How exactly does that square with Apple selling a record number of iPads this past quarter?  ...

 

http://www.ubergizmo.com/2013/02/ipad-business-slow-down-analyst/

 

Hey R... check the chart heading in that article.

 

That particular report was only saying that the larger iPad sales were down.

 

Of course, one major reason for that would be the number of sales of the iPad mini.

 

Basically, the article was all about how smaller tablets are selling well.

post #31 of 42
I am a result of the halo effect also. A few years ago, I didn't know much about Apple. Now, my whole tech world revolves around them. I used MS Windows for 22 years, and now MS does not exist in my house. I hope I can stay happy with Apple. I do think OSX could use a good overhaul under the hood though.....not just pretty things added to it.
post #32 of 42
Quote:
Originally Posted by drblank View Post


I don't know if you're into Home Automation systems and want or need a high end Home Automation solution, but Savant Systems is completely Apple and they have the absolutely slickest stuff on the market, but expect to have professionals install it.  I'm not at the point of calling someone in to install their products, but the second I can afford it and have a place I want to implement a high end solution, CALL THEM.   They do some SLICK stuff!!!!

 

Just giving you something to think about.........  These guys push the envelope in home automation.

 

I will definitely check them out...I love the stuff, I automate as much as I can around here.  My Neato vac is like a pet around here.  We call him Artoo.  As in, R2D2.  ;-)  The kids get a kick out of that.  (by the way, if you or anyone reading this wants advice/tips on a robot vac, Neato is the only way to go.  I've tried all of them, Neato is amazing)


Thanks for the tip!

post #33 of 42
Quote:
Originally Posted by bondr006 View Post

I am a result of the halo effect also. A few years ago, I didn't know much about Apple. Now, my whole tech world revolves around them. I used MS Windows for 22 years, and now MS does not exist in my house. I hope I can stay happy with Apple. I do think OSX could use a good overhaul under the hood though.....not just pretty things added to it.

 

I have one Windows PC left, my oldest daughter uses it for homework.  But this year, it's getting the boot.  Or is it reboot?  My plan is to pass my iMac to her and go with the 13" rMBP with a Thunderbolt display.  We'll see if my wife vetoes it in the budget, but I usually tell her it's about 1k more than actual cost, so I come in under budget.  ;-)

post #34 of 42
Quote:
Cook said. "I think we're in the early part of this game. The projection is that the [tablet market] will triple in four years."

 

 

I think this is a VERY low estimate. Once the family of Apple tables fills out, this will be the new standard. In the next 1-2 years, you will be purchasing a 27" panel to use with your iPad on your desk as you do a Macbook today. 

post #35 of 42
Quote:
Originally Posted by 1983 View Post

Apple was founded on the Apple I/II not the Mac.

 

I thought it was founded on the hatred of IBM? ;) 

post #36 of 42
Of course the iPad is slowly getting rid of PCs yet at least 5 years to go, with the iPad and MacBook (lineup) which would be better to buy? Both have certain advantages
post #37 of 42
Originally Posted by bondr006 View Post
I do think OSX could use a good overhaul under the hood though...

 

What would that include? We just got one in the form of pure Intel support. Before that was the addition of Intel support, and before that a wholly new OS. Next is pure 64-bit support. 

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post #38 of 42
Quote:
Originally Posted by Tallest Skil View Post

 

What would that include? We just got one in the form of pure Intel support. Before that was the addition of Intel support, and before that a wholly new OS. Next is pure 64-bit support. 

 

There's some suggestions here. Perhaps not as bad as he makes it sound, but looks he has a basis for what he thinks needs attention:

http://macperformanceguide.com/AppleCoreRot-intro.html

melior diabolus quem scies
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post #39 of 42
Quote:
Originally Posted by KingChael View Post

Wall Street has given Cook's presentation today a big thumbs down.  Talk about arrogance, ignorance, and incompetence all rolled into one.

 

Also got to love my posts getting deleted by coward mods/admin who can't take reality and defend the truth.  What are you, Tim's personal doggies?

talk about arrogance, ignorance and incompetence. Someone who does not understand how the stock market works yet tries to explain what happens to Apple stock. 

post #40 of 42
Quote:
Originally Posted by KingChael View Post

Wall Street has given Cook's presentation today a big thumbs down.  Talk about arrogance, ignorance, and incompetence all rolled into one.

 

Also got to love my posts getting deleted by coward mods/admin who can't take reality and defend the truth.  What are you, Tim's personal doggies?

I know the King has been banned but Im going to post anyway ...

Can a mod with superpowers alter his/her handle to "Daves Mom" ?

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