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Editorial: Why Apple, Inc. isn't worried about iPad's IDC tablet "market share"

post #1 of 56
Thread Starter 
In the face of dubious market research portraying Apple's iPad (and perhaps the entire tablet market) as troubled and teetering on the brink of collapse, Apple's chief executive Tim Cook expressed a sincere lack of concern while addressing analysts, alluding to long term strategies for outliving tablet rivals focused on volume shipments and short term market share gains.

http://www.businessinsider.com/chart-of-the-day-apple-ipad-tablet-market-share-falls-2014-7


iPad's $5.9 billion quarterly "lull"



Over the last quarter, Apple brought in $5.9 billion from iPad sales. That's more money than Amazon, Microsoft and Google can attribute to their sales of tablets, ever. However, Apple sold fewer iPads than it had in the year-ago quarter, its second quarterly drop from last year's figures.

In the March quarter, Apple sold 3.1 million (16.1 percent) fewer tablets year-over-year (slipping from 19.5 million to 16.4 million), and in the June quarter iPads were again down, by 9.3 percent (slipping 1.3 million units from 14.6 million to 13.3 million).

According to IDC, the rest of the global tablet market grew over both of those two quarters, albeit only by 3.9 percent (less than two million new units overall) in the March quarter and then 11 percent (less than five million new tablets sold) for the quarter ending in June. In the U.S. and in Western Europe, where Apple appears to sell most of its iPads, IDC noted that overall tablet demand had declined during the quarter, with the U.S. market specifically down 5 percent.

The back-to-back "bad news" for iPad was accompanied by IDC slashing the tablet "quarterly market share" it apportions to Apple down to nearly 25 percent of global "tablet shipments," enabling websites along the lines of Business Insider to depict a purported collapse in iPad "share" using IDC's statistics (above).

IDC's flexible tablet numbers



One very troubling problem with IDC's statistics is that after the company publishes its estimates on the tablet market, it revises them after the fact. There's only one company's tablet numbers that don't ever change: Apple's. That's because IDC (like other research groups) constructs its tablet estimates around Apple's iPad figures, the only sales data that is ever reported publicly.

In May, for example, IDC's tablet estimates for Q1 2014 were compared against a year ago quarter where Samsung was estimated to have shipped 8.5 million tablets. A year ago, however, IDC reported that Samsung had shipped 8.8 million tablets in Q2 2013. That's a statistical "oops" that in terms of $349 Galaxy Tabs would have incinerated about $105 million worth of "lost" tablets.

IDC Q2 2013 before


Similarly, if IDC hadn't retroactively erased (below) 1.1 million "other" tablets it had counted (above) in Q2 2013 (reducing the output of "others" from 17.5 million to 16.4 million), it would be reporting that "others" tablet shipments grew by 25 percent rather than by more than 33 percent. Without such shifting numbers, IDC's current assessment of 11 percent global tablet growth would fall by 18 percent.

IDC Q2 2013 after


These types of vast, multi million dollar shifts that occur in IDC's estimated tablet shipment figures strongly suggest not only that IDC isn't very confident in its ability to estimate shipments, but also that its estimates are penciled in to arrive at a desired conclusion, rather than being hard data worth drawing significant conclusions from.

This harmonizes with comments made by a former IDC analyst who described the process of market estimates to Philip Elmer-DeWitt of Fortune as being a "sausage-making process" driven by the mantra "preserve the growth rates; to hell with the actual numbers."

Tellingly, he added, "the fudge is in the 'others' category, which is used as a plug to make the numbers work out."

It appears that various market research firms are fudging the tablet shipments attributed to "others" entirely to create an illusion that iPads shipments are lower than they should be, because no significant numbers of legitimate tablet sales can actually be attributed to any real company.

IDC's statistics also appear to intentionally obscure important, relevant context. First: Apple's iPad sales are more cyclical than its competitors.

Second: the rest of the tablet market is performing very poorly and largely offers products that do not directly compete with the iPads Apple is selling.

Third: Apple has a long term strategy that isn't simply targeting shipment volumes in an effort to impress the same tech pundits and market researchers who thought netbooks were going to have a lasting impact on the PC industry.

iPads


First: Apple's cyclical iOS sales



Notably absent in the handwringing (or more accurately, Schadenfreude) about Apple's iPad "collapse" as reported by market "research" and "insider" groups is any recognition of the fact that Apple sells most of its tablets in the winter holiday quarter. This is not a new phenomenon. Apple has long sold far more iPods and iPhones in the winter quarter, too.

Recall that Apple's critics used to pounce upon the company's cyclically slower iPhone sales in the spring or summer as if the company's low period were evidence of an impending mass migration to Android (and before Android, Symbian or Java Mobile). That line of attack has been pinched off as Apple's iPhone sales remained high this entire year even during the company's historically slow season, thanks to broader distribution--particularly in China--that has helped smooth out the Western holiday cycle.

iPad sales remain highly cyclical, but buying patterns are changing as Apple builds its presence in China and other developing nations, introducing iPads and Macs to new audiences behind the iPhone.

Apple sold 26 million iPads in the December quarter, an increase of 13.5 percent (3.1 million additional units) over its previous record holiday sales quarter. If rather than fixating on Apple's slow quarters, you instead step back and look at the last annual cycle of four quarters, Apple sold 69.7 iPads, compared to 71 million iPads over the previous four quarters.

That's a difference of 1.3 million fewer units compared to the previous year, or effectively a rounding error when considering that Apple maintains 4-6 weeks of inventory, and that Apple has consistently sold on average 1.3 million iPads per week over the last year, and that it ended the last quarter with a half-million unit reduction in iPad inventory. While Apple's iPad sales are not growing globally over its year-ago sales, iPads are flat, not contracting and certainly not "collapsing."

Second: Tablet competition failing to materialize



It's actually pretty remarkable that Apple's sales are not "collapsing," given that Samsung has long been liberally giving away its tablets while others in the tablet industry (notably Amazon, Google/Motorola and Microsoft) have actively lost lots of money from their tablet adventures, without selling enough devices to even appear in IDC's top five vendors for the quarter. That's a pretty low bar considering that Asus brings up the rear with shipments of just 1 million units.

Again: fifth place Acer and at least 22 "other" tablet vendors who collectively make up over 46 percent of the global supply that IDC counts as "tablets" are ostensibly being sold by companies who sell fewer tablets in three months than Apple sells in its average week. Over 46 percent of the global supply that IDC counts as "tablets" are ostensibly being sold by companies who sell fewer tablets in three months than Apple sells in its average week

Without any real tablet competitor left to draw attention to--and Samsung has definitely failed in that regard, even when ignoring profits and only looking at unit shipments--IDC is again forced to pit Apple against the collective tablet shipments of the rest of the world, where "other" is a bunch of unnamed companies whose production is impossible to verify because none of these companies announce figures for how many tablets they are selling.

Also, note the contrast between IDC's global tablet focus and its (factually incorrect) U.S.-only portrayal of Macs. An interesting selection of data to call attention to, to say the least.

While Apple would obviously like to see its iPad sales grow, the fact that iPad sales are not slipping in the face of desperate, money losing competitors literally dumping their products in the market is not the only remarkable bit of data that market researchers are distracting attention away from.

Third: Apple building iPad as a new business



iPad clearly achieved the "third platform" goal that Apple's Steve Jobs described for the new tablet almost five years ago. Rather than an unsustainable bubble of hyper-growth that Acer's netbooks achieved in 2009 at the painful expense of eating into conventional PC sales and profit margins, Apple's iPad has grown into a business larger in both units and revenues than the Mac.



And rather than cannibalizing its Mac sales to achieve this, iPads appear to have helped Apple to expand its Mac sales via a halo effect, attracting new customers to OS X via iOS, a practice Apple is doubling down on with new Continuity features in its upcoming OS releases.

If Apple had to choose between growing its Mac or iPad sales, the most ideal scenario would be to maintain iPad sales at their current high rate (greater than the next three tablet makers' reported shipments combined) while seeing Mac sales grow by a significant amount. That is exactly what happened in this quarter. Global Mac sales were up 13 percent, nearly tying up Mac ($5.5 billion) and iPad ($5.9 billion) sales in terms of revenue.

The way Acer achieved its temporary surge in netbook sales back in 2008 was to slash prices and deliver a poor quality product very cheaply. That strategy gained standing applause from many pundits, but it did not work well long term. Apple could, like Acer, blow out cheap iPad models that turn people off to the whole idea of buying a tablet ever again.

Instead, Apple is selling as many high quality tablets as it can, a strategy that has made it by far the world's largest maker of tablets (as well as the only significantly profitable tablet vendor) and given it a new product category that sells alongside Macs without suffering any significantly apparent cannibalization.

Half of iPads sold to new buyers



Speaking of iPad as "the category that we created," Apple's chief executive Tim Cook noted during the quarter's conference call that in "a little over four years, we have now sold 225 million iPads, which is I think probably a larger number than anyone would have predicted at the time and including ourselves, quite frankly.""We still feel that category as a whole is in its early days and that there is also significant innovation that can be brought to the iPad and we plan on doing that" - Tim Cook

He added, "we still feel that category as a whole is in its early days and that there is also significant innovation that can be brought to the iPad and we plan on doing that.

"When I look at the top level numbers, I get really excited when I see that more than 50% of the iPads that we're selling are going to someone who is a first time tablet buyer. I get excited when I see that our retail share according to NPD in the month of June was 59% of units and over 70% in terms of dollars. And of course, Luca has mentioned in his preamble that our education share is 85%."

Unlike Acer's netbooks, Apple created a product people will want to buy again, even if they don't plan to repurchase every new iPad model each year. Apple is not only lining up repeat iPad customers, but it is maintaining its current pace of sales by selling half of its iPads to new buyers.

Media handwringing about "longer replacement cycles" for tablets seem to miss the fact that Apple managed to sell more than 6.6 million iPads to new tablet buyers in a cyclically slow quarter. Apple's new iPad buyers alone outnumbered the total tablet buyers IDC estimated for Lenovo, Asus and Acer. And of course, Apple sold another 6.6 million iPads to its repeat buyers in the quarter, along with 4.4 million Macs.

That explains why Cook also said that "iPad sales met our expectations but we realized they didn't meet many of yours," an allusion to the perpetual growth percentages that analyst dream up without really articulating how such rosy numbers could possibly be achieved without causing unintended side effects, ranging from giving up dollar share in the market, to destroying Mac sales, to erasing any demand for Apple's tablets in the future.

Were Apple being run by analyst-pleasing salesmen, short term demands for ever faster growth might likely have the same detrimental impact on the company's long term viability just as it did with Acer's netbooks, with the Android 2.x tablets Samsung rushed to market in 2010, and with the Old Apple's Performas and Mac Clones back in the 1990s.

Long term Apple vs Short term Google



That same kind of short term thinking is apparent in Google's more recent efforts to dump its super cheap Asus-built Nexus 7 tablets onto the market in a bid to "grab market share."

Google not only failed to create substantial short term sales and a sustainable long term tablet hardware business, but also demonstrated how little value there is in Google web ads, which heavily promoted the Nexus 7 throughout the holiday season without moving the needle on sales enough to notice in IDC's data.



In stark contrast, Apple has promoted sustainable, organic growth in iPad sales from multiple directions, including the carefully considered creation of a new mobile computing platform relevant not only for consumers watching movies or browsing the web, but also for retail, government, education and corporate markets.

Cook noted that Apple's iPad is represented in "virtually all Fortune 500 companies--we are in 99% of them to be exact--and 93% of the Global 500. However, when we dig into the business market deeper, though our market share in the U.S., in the commercial sector is at 76% -- this is according to IDC; the penetration in business is low. It's only 20%. And to put that in some kind of context, if you looked at penetration of notebooks in business, it would be over 60%. And so we think that there is a substantial upside in business. And this was one of the thinkings behind the partnership with IBM that we announced last week."

Those comments expose Apple's intent to continue building a long term, sustainable iPad business, rather than simply shipping inventory to stores in the hopes that something will stick. Really, while Google's Android partners led by Samsung furiously throw their tablet spaghetti at every wall, Apple is heaping all of its iPad pasta on plates and delivering it to appreciative, paying customers who will be back to visit again. That's just a smarter way to run a restaurant.



If iPad sales are flat, where is tablet growth coming from?



If you review IDC's figures over the past four quarters, a series of false hopes spring out as would-be iPad killers before collapsing, forgotten. Last October, IDC was touting Samsung's 123 percent growth, Acer's 346 percent growth, and Lenovo's smoking 420 percent growth in tablets. Those impressive numerical increases rapidly began to peter out over the next few quarters.

Instead of ever surpassing Apple (as commodity producers did in PCs and in smartphones), the combined shipments of the top three tablet vendors behind the iPad amount to fewer tablets than Apple on both a quarterly and annual basis. As AppleInsider previously observed, Apple's tablet sales are maintaining peak sales levels while all of Apple's recognizable tablet competitors are either failing to catch up (Samsung, Asus, and Lenovo) or falling off the charts entirely (Microsoft Surface, Google/Motorola, Amazon Kindle Fire).

Over the last quarter, IDC says Samsung's tablet shipments have also flattened out, but at a level that's just 60 percent of what Apple is selling in its lowest quarter. Unlike Apple, Samsung doesn't release one or two annual new tablet models, but instead offers a steady stream of scores of different tablet options throughout the year. Given that Samsung sells more than twice the number of smartphones than Apple while earning less than half as much, Samsung's flatlining tablet sales, despite all the free offers, indicate Samsung isn't earning very much at all from tablets.

In the most recent quarter, IDC had to resort to padding "other" shipments in order to achieve negative market share shift for Apple. As the firm's Worldwide Quarterly Tablet Tracker Research Analyst Jitesh Ubrani explained, "Until recently, Apple, and to a lesser extent Samsung, have been sitting at the top of the market, minimally impacted by the progress from competitors. Now we are seeing growth amongst the smaller vendors and a levelling of shares across more vendors as the market enters a new phase."

In other words, there are no recognizable competitors IDC can legitimately compare against Apple in a favorable light, so it must now statistically invent dozens of small firms that ship tiny batches of devices that can charitably be defined as "tablets." According to IDC's latest numbers, 44.4 percent of "tablet market shipments" are now being credited to firms smaller than Acer, which shipped an IDC-estimated 1 million tablets.

garbage tablets


Again: in order to "estimate" that global tablet sales were up 11 percent in the June quarter, IDC had to credit "other," a series of at least 22 firms--each smaller than Acer-- that each shipped less than one million tablets in the quarter.

It's almost as if the USSR had collapsed and the military industrial complex tasked with perpetuating military sales had to invent a new kind of guerrilla enemy that fights without a flag just to keep threat levels raised high enough to support a blank check budget for war, except that in the tablet market there is no actual Al Qaeda. Nobody is actually selling threateningly large numbers of tablets, and absolutely nobody apart from Apple is earning any significant profits from their tablet sales. Apple, on the other hand, brought in $5.9 billion from iPad sales in just the last quarter.

Bad news for iPad doubters



Apple's ability to make tons of money from its iPad sales--while outselling its next three competitors combined--is a daunting problem for research firms tasked with creating numbers that denigrate and marginalize the iPad. In the smartphone and conventional PC markets, Apple has always held minority market share in terms of units shipped but has consistently earned the lion's share of the profits in each industry.

In tablets, Apple is not only taking the profits but is leading in shipment figures so decisively that IDC can't point to any other specific company as a worthy competitor. Even when mentioning Samsung, Ubrani was forced to qualify the Korean conglomerate's participation in the tablet industry as being "to a lessor extent" than Apple because Samsung can't even give away tablets at a rate approaching Apple's iPad sales.

Further--as is the case with smartphones and conventional PCs--IDC's estimated "shipments" of tablets don't--by themselves--provide much information about what sort of devices are being counted. IDC's Ryan Reith noted to AppleInsider last year that the firm began counting devices that were really "kids tablets or toys" just to beef up the "other" numbers.

At this point, the convoluted logic presented by IDC, Gartner and Strategy Analytics to explain why Apple's runaway iPad success should actually be best thought of as a burning house sliding down the side of mountain sounds an awful lot like Russia Today inventing plausible reasons for why an airliner shot down over Ukraine can't possibly have anything to do with the fact that President Putin is arming rebels with the only sophisticated weapons in the area capable of doing just that.

In both cases, the originator of the news reports is intimately entangled with the benefactors of fooling as many people as possible by creating massively fraudulent propaganda. It's that simple.

Putin on the BRIC



Speaking of which, recall when President Putin announced that he (in a move later copied the Communist Chinese government) was afraid of Apple's iPad being used to "spy" on him and was therefore going to buy Samsung Android tablets rather than iPads? Despite being reported by (ahem) Business Insider prior to the beginning of the June quarter, there did not seem to be any discernible reflection of this in IDC's tablet numbers.

While Business Insider found the idea of iPad sales in Russia momentarily intriguing, it appears to lack even a shred of curiosity about how iPads are actually selling on a regional basis, the same way it ignored the cyclical nature of iPad sales to jump on Apple's mid-year sales nadir as evidence of the iPad's "collapse."

If only there were some public data available on how well iPads had sold on regional basis! Oh wait, there is that data Apple graciously volunteered for the most recent quarter.

Apple's chief financial officer Luca Maestri noted, "iPad sales grew overall in the developing markets with particularly strong year-over-year growth in the Middle-East, where iPad sales were up 64%, in China where they grew 51%, and in India, where they were up 45%." However, he added, "This growth was more than offset by lower sales in more mature markets."

So as it turns out, the sum total of global iPad sales hide interesting hills and valleys. Pundits have tried to paint iPads as a "media tablet" toy with no relevance in the enterprise and priced out of the reach of users in developing countries. As it turns out, this is completely backwards. Pundits have tried to paint iPads as a "media tablet" toy with no relevance in the enterprise and priced out of the reach of users in developing countries. As it turns out, this is completely backwards.

Affluent users in developed countries are continuing to buy higher end Macs at a rate that continues to outpace the conventional PC industry (despite IDC and Garter failing to correctly estimate this in their own market research tracking PC sales in the most recent quarter). At the same time, Apple is noting that iPad is seeing its fastest sales growth rates in developing countries.

And actually, at the same time Apple also reported "strong double digit growth" in Macs not only in affluent Western countries including the U.S., Canada, the UK, Germany, France and Australia, but also in Mexico, China, India and the Middle-East.

Somehow, the collective researchers of IDC, Gartner and Strategy Analytics are observing both Apple's growing sales of premium Macs around the world (up 13 percent globally in the most recent quarter) as well as the rapid growth of iPads in developing countries and the only bit of news they wish to share is that global iPad sales are in a cyclical trough and being outnumbered by small batch craft tablets. That, and misstating Apple's double digit U.S. Mac growth in a flat-to-declining PC market.
post #2 of 56
Quote:
Originally Posted by AppleInsider View Post

except that in the tablet market there is no actual Al Qaeda.

Second mention of Al Qaeda in as many days? WTF?

And didn't we already "establish" Al Qaeda are very much in the tablet market and prefer Android?
post #3 of 56
Daniel,

Thanks for getting back to real info.

( Your previous Al-Qaeda piece was probably your Bermuda Triangle moment.)
post #4 of 56
Sure hope Apple][ isn't going to read this article.
Send from my iPhone. Excuse brevity and auto-corrupt.
Reply
Send from my iPhone. Excuse brevity and auto-corrupt.
Reply
post #5 of 56
More points that can be used to rebuttal apple haters in other forums. I will take what I can get. Consider this article saved to pocket. 1smile.gif
post #6 of 56
Quote:
Originally Posted by abazigal View Post

More points that can be used to rebuttal apple haters in other forums. I will take what I can get. Consider this article saved to pocket. 1smile.gif
Useful. But not definitive.
Out there, DED along with AI, Gruber or any other Apple centric blogger, is instantly condemned as a fanboy and thus a100% bogus source of 'facts', so cannot possibly represent real world scenarios. Since they are outnumbered 20:1 by naysaying pundits who must continually dissemble in order to get paid, the sheer volume of untruths will always prevail. Worse, even when exposed, they will immediately execute a 180, change the argument, change the rules or invent a new category that shows Apple is failing in an area of non-existent business. It's an unwinable battle when your opponents very existence and the associated co-dependence of huge areas of technology business, are at stake.
TBO...I don't think Apple management cares that much. They could certainly be more aggressive in refuting this nonsense but they probably realised many years ago that permanent 'underdog' status means they can ride out these market squabbles.
post #7 of 56
In a sense, I will argue that DED represents both the best and the worst aspects of Apple fanboyism.

It's rude to gloat, but DED does it so masterfully that I admit to deriving guilty pleasure from his articles. On the other hand, to be willing to spend the time to research and craft such articles, even if it is for a paid site, speaks volumes about his passion.

I don't think Apple really needs to do anything, to be honest, but their job. Samsung looks like it is starting to implode under their short-sighted decision to prioritize market share over developing a healthy ecosystem and long term profitability. Apple is only just getting started. You know this when they announced features like continuity in ios8, a feature riding on Bluetooth LE, which incidentally has been in many Apple devices since 3 years ago. That's vision, that's Apple with a plan, and I can't wait to see where Apple goes from there.

I continue debating because it just irritates me when I see blatant lies and misinformation floating around in sites like cnet. The people there aren't even interested in having a civil discussion; they are simply set in bashing Apple every chance they get, just because they can.

So while it may be an uphill battle, doesn't mean I can't fight off for as long as I can. 1smile.gif
post #8 of 56
I never really trusted IDC numbers. Wonder why so many insiders publish IDC numbers as they are the word of God.
post #9 of 56
I did enjoy the Al-Qaeda piece too!

During my 30 year career I have worked for several hardware and software manufacturers that supplied data to IDC (and Dataquest) for these kind of shipping reports. There were never any checks on the validity of the numbers provided and since we were all competing with each other, the temptation to exaggerate was very high.

As a challenger, I often questioned (complained) about this to IDC, that claimed they had other methods to cross-verify the numbers. I doubted then as I do today that they really have.

These kind of shipping/marketshare reports need to be taken with a pinch of salt.
post #10 of 56
I want to invest in 'Others.'
post #11 of 56
Quote:
Originally Posted by abazigal View Post

In a sense, I will argue that DED represents both the best and the worst aspects of Apple fanboyism.

It's rude to gloat, but DED does it so masterfully that I admit to deriving guilty pleasure from his articles. On the other hand, to be willing to spend the time to research and craft such articles, even if it is for a paid site, speaks volumes about his passion.

I don't think Apple really needs to do anything, to be honest, but their job. Samsung looks like it is starting to implode under their short-sighted decision to prioritize market share over developing a healthy ecosystem and long term profitability. Apple is only just getting started. You know this when they announced features like continuity in ios8, a feature riding on Bluetooth LE, which incidentally has been in many Apple devices since 3 years ago. That's vision, that's Apple with a plan, and I can't wait to see where Apple goes from there.

I continue debating because it just irritates me when I see blatant lies and misinformation floating around in sites like cnet. The people there aren't even interested in having a civil discussion; they are simply set in bashing Apple every chance they get, just because they can.

So while it may be an uphill battle, doesn't mean I can't fight off for as long as I can. 1smile.gif

I am continuously baffled as to why so many Americans want to back a Korean company over Apple, from these so called experts to the Joe Plummer in the street. Can they all be the old PC brigade that used to gloat over Apple's domination by Wintel beige boxes now hating being the underdogs in a new mobile world? Did they all decide they'd rather support a Korean company than ever admit Apple has wiped the floor with their beloved Microsoft? If it's not that then what? Only anecdotally but the few PC devotees I know all use Scamsum tablets and phones and claim iOS is 'too walled', and Apple' is over priced and just for people that don't need to do real work ' etc. etc. They would die rather than be seen with anything from Apple. It is very strange, and sad indeed to see them with such crippled junk rather than just admit Apple make the best stuff there is.
Edited by digitalclips - 8/4/14 at 5:50am
From Apple ][ - to new Mac Pro I've used them all.
Long on AAPL so biased
"Google doesn't sell you anything, they just sell you!"
Reply
From Apple ][ - to new Mac Pro I've used them all.
Long on AAPL so biased
"Google doesn't sell you anything, they just sell you!"
Reply
post #12 of 56
Quote:
Originally Posted by digitalclips View Post


I am continuously baffled as to why so many Americans want to back a Korean company over Apple, from these so called experts to the Joe Plummer in the street. Can they all be the old PC brigade that used to gloat over Apple's domination by Wintel beige boxes now hating being the underdogs in a new mobile world? Did they all decide they'd rather support a Korean company than ever admit Apple has wiped the floor with their beloved Microsoft? If it's not that then what? Only anecdotally but the few PC devotees I know all use Scamsum tablets and phones and claim iOS is 'too walled', and Apple' is over priced and just for people that don't need to do real wor ' etc. etc. They would die rather than be seen with anything from Apple. It is very strange, and sad indeed to see them with such crippled junk rather than just admit Apple make the best stuff there is.

I hate to admit it but I'm starting to look at all Korean-based products with caution. I already won't buy Samsung products but am adding Hyundai and Kia as well as not even looking at tires made by Hankook. It brings me back to those days past where anything made in Japan was suspect. There's no way around buying products made in China but being made in a country can be different from being made by a company based in a foreign country (Samsung vs. Apple). 

post #13 of 56
Quote:
Originally Posted by digitalclips View Post


I am continuously baffled as to why so many Americans want to back a Korean company over Apple, from these so called experts to the Joe Plummer in the street. 

 

As the iHaters will allege, Apple is NOT an American company. They repeat the FUD that Apple manufactures nothing and that all their products are made in China. They point to the “Designed by Apple in California” label as proof.

 

Forty years ago people were asking Americans the same question regarding automobiles. How could an American buy a “Jap” car? How could Americans buy foreign goods when they know it will cause job losses locally? Well, they can and they do.

post #14 of 56
Quote:
Originally Posted by rob53 View Post
 

I hate to admit it but I'm starting to look at all Korean-based products with caution. I already won't buy Samsung products but am adding Hyundai and Kia as well as not even looking at tires made by Hankook. It brings me back to those days past where anything made in Japan was suspect. There's no way around buying products made in China but being made in a country can be different from being made by a company based in a foreign country (Samsung vs. Apple). 

 

Watch it, buddy. You are teetering on the brink of being labeled a racist xenophobe. <sarcasm> Gotta keep it politically correct these days.

post #15 of 56

Actually, I'm less concerned about Apple's iPad sales "slipping" than I'm worried about why these research agencies are trying to find fault with Apple's business.  I'd like to know what they're gaining from doing this and who's paying them, if anyone, to mess with the tablet sales numbers.  Isn't it their business to keep investors informed of the truth of where to put their money into a successful business?  It would hurt investors more than Apple if they're lying to investors.  If they're trying to make Apple's iPad business into a failing business then they're simply giving misinformation to potential investors.  In some way, I wonder why Apple doesn't address these attempts at pulling Apple's business down with its own marketing expertise.  I know that what really matters is how much money a company earns every financial quarter or actually for a total year of sales but it doesn't seem right for Apple to allow these research agencies to defame their tablet business.  I'll never understand as to why any business has to hold its sales numbers to follow some research agencies' expectations.  There are things like the economy that doesn't allow that from quarter to quarter or year to year.  Selling products is a lot more difficult than simply setting expectations for sales.  There are things like political unrest or even a possibility of loss of jobs that can affect sales of products.  Consumers sometimes don't feel comfortable making purchases if they have a slight fear of loss of employment.  That could cause a consumer to buy a $50 tablet in place of a $400 tablet.  I honestly don't get the purpose of a research agency if they're only going to put the numbers where they want them to be instead of where they belong.  A research agency that is simply guessing numbers isn't really doing their research.

post #16 of 56

The anecdotal evidence in my neck of the woods:

 

At work, we're just starting to buy iPads, which is to say we've purchased a few hundred for specific projects so far, with plans to buy many hundreds more. We're also buying 3 Surface tablets for evaluation. We have NO plans for purchasing any other brand of tablet.

 

This on top of the BYOT usage which is still gaining momentum and which is almost all iPads, somewhere in the dozens and rising, with two exceptions: one of our tech guys uses a trouble-prone Google tablet, and one officeworker uses a Samsung. Another officeworker did use a Google tablet, but gave up on it and bought an iPad after it had screen problems and Google's "customer service" turned into a bunch of finger-pointing emails and no actual support.

 

So, at least around here, the IDC numbers reek of BS and the sweaty desperation of whichever second-tier vendor is paying them to pump out their garbage.

 

My expectation is that the iPad market is in a soft spot which will vanish as corporate purchasing picks up. The IBM alliance will undoubtedly help this tremendously.

 

Personally, I'm pretty comfortable with the "buy a new iPad every 2 years and give away my old one" approach. People complain about iPads being expensive, but that's only in comparison to crappy no-name tablets, crippled Chrome laptops, and the like. $500 every other year is reasonable for a device I use almost constantly for both work and fun. I fully expect that Apple's late-2015 iPad will be a significant upgrade over my Air, and expect to buy one.

 

[Full disclosure: I do own and occasionally use a B&N Nook tablet. Hard to pass up at $30 refurbished.]

post #17 of 56
A few hours after reading this article, I came across a Business Insider article titled, "Here's the Real Reason Apple's iPad Sales Are So Awful".

http://finance.yahoo.com/news/heres-real-reason-apples-ipad-102641425.html?.tsrc=applewf

I forced myself to read the article twice to just try understanding what had been written. What I deduced is Business Insider is punishing Apple for producing quality tablets that get used 2.x longer than competing Android tablets!

What was extraordinary was, "... Android tablets have an average active life of little under a year. Or, that they have a life of more like two years (say) but half of them are inactive."

An article titled like the Business Insider article makes it to the top of Yahoo Finance while Apple Insider's article does not.
post #18 of 56

Concise version of the above article:

 

"Market researchers are useless."

post #19 of 56
Quote:
Originally Posted by rob53 View Post

I hate to admit it but I'm starting to look at all Korean-based products with caution. I already won't buy Samsung products but am adding Hyundai and Kia as well as not even looking at tires made by Hankook. It brings me back to those days past where anything made in Japan was suspect. There's no way around buying products made in China but being made in a country can be different from being made by a company based in a foreign country (Samsung vs. Apple). 

Ok my meaning got totally lost ... Remove American and Korean and replace with Apple and a 'another company making a lower quality product' ... my point was these Apple haters will buy anything but Apple even if their life depended on it.

Any discussion that brings 'Korean made' up always brings out the Kia drivers defending their beloved cars en masse. I always forget and make the same mistake and mention 'Korean' simply because they are. I feel the same about Microsoft products and they are just as American as Apple.

My wife's last few cars have all been foreign, Saab, Audi, Merc, BMW and Lexus so i can't talk! Then again I stick to Jeeps. But as an ex Brit they are foreign to me I guess 1smile.gif
From Apple ][ - to new Mac Pro I've used them all.
Long on AAPL so biased
"Google doesn't sell you anything, they just sell you!"
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From Apple ][ - to new Mac Pro I've used them all.
Long on AAPL so biased
"Google doesn't sell you anything, they just sell you!"
Reply
post #20 of 56
Quote:
Originally Posted by digitalclips View Post

I am continuously baffled as to why so many Americans want to back a Korean company over Apple, from these so called experts to the Joe Plummer in the street. Can they all be the old PC brigade that used to gloat over Apple's domination by Wintel beige boxes now hating being the underdogs in a new mobile world? Did they all decide they'd rather support a Korean company than ever admit Apple has wiped the floor with their beloved Microsoft? If it's not that then what? Only anecdotally but the few PC devotees I know all use Scamsum tablets and phones and claim iOS is 'too walled', and Apple' is over priced and just for people that don't need to do real work ' etc. etc. They would die rather than be seen with anything from Apple. It is very strange, and sad indeed to see them with such crippled junk rather than just admit Apple make the best stuff there is.

Had a roommate about 10 years ago. He was PC... Although not just windows.... I waS Mac.... Constantly debated the issue but he was a coder and "had" to do real work. I was just running a small company of 15 people. Any way, to make a long story short, the last time I saw him was in the local Apple store. I laughed.
post #21 of 56
Quote:
Originally Posted by leavingthebigG View Post

A few hours after reading this article, I came across a Business Insider article titled, "Here's the Real Reason Apple's iPad Sales Are So Awful".

http://finance.yahoo.com/news/heres-real-reason-apples-ipad-102641425.html?.tsrc=applewf

I forced myself to read the article twice to just try understanding what had been written. What I deduced is Business Insider is punishing Apple for producing quality tablets that get used 2.x longer than competing Android tablets!

What was extraordinary was, "... Android tablets have an average active life of little under a year. Or, that they have a life of more like two years (say) but half of them are inactive."

Ars has a related take on the tablet market, posted up yesterday.
http://arstechnica.com/gadgets/2014/08/op-ed-tables-really-are-pcsbecause-theres-no-point-in-buying-new-ones/
melior diabolus quem scies
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melior diabolus quem scies
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post #22 of 56
Developing sales channels is simply hard work

Purchasing iPads for the purposes of general use may, in fact, be maturing in the United States. The markets in developing countries may be expanding and the focus of Apple and its management today.

To move more iPads into the market, Apple management will need to differentiate iPads on the basis of specific usages medicine, inventory control and business operations, mathematical analytics and trading in banking, design engineering and equipment maintenance in heavy equipment manufacturing---may be what is needed to have Apple penetrate deeper into the marketplace. This is why Apple's relationship with IBM is so interesting and there is history in other computing areas that support this very idea.

Corporations, hospitals and government do not care about Hulu, YouTube, or weather. They need iPads to do specific functions and the iPad infrastructure must integrate with data sources that currently exist on the users computer infrastructure. Partnering with IBM and other system integrators (EDS, Accenture, hundreds of others) and participating in "solution" selling is the proven approach to getting into "the enterprise" (and selling bucket-loads of units in the process)

This is a smart long term strategy and built thru hard work, focus and co-investment. Codos to Apple for their willingness to invest smartly in the long-term.
post #23 of 56
Quote:
Originally Posted by lkrupp View Post

As the iHaters will allege, Apple is NOT an American company. They repeat the FUD that Apple manufactures nothing and that all their products are made in China. They point to the “Designed by Apple in California” label as proof.

Forty years ago people were asking Americans the same question regarding automobiles. How could an American buy a “Jap” car? How could Americans buy foreign goods when they know it will cause job losses locally? Well, they can and they do.

A great many of those 'Jap' cars are now built in the US. A few years ago the biggest importer of cars into the US was GM, but I don't know if that still stands true.
"Few things are harder to put up with than the annoyance of a good example" Mark Twain
"Just because something is deemed the law doesn't make it just" - SolipsismX
Reply
"Few things are harder to put up with than the annoyance of a good example" Mark Twain
"Just because something is deemed the law doesn't make it just" - SolipsismX
Reply
post #24 of 56
Quote:
Originally Posted by Constable Odo View Post

. I honestly don't get the purpose of a research agency if they're only going to put the numbers where they want them to be instead of where they belong.  A research agency that is simply guessing numbers isn't really doing their research.
It's like a stage clairvoyant act. You get to the answer you want to give, by very selective questions. So if company X, is considering a move in the tablet market, then the researcher will get to a point where they know exactly what company X wants to hear. If the company is gung-ho, or undecided or even anti, then the report will echo those sentiments. The more depth required to support the conclusion, means it will inevitably cost more and be more selective, research wise.
At the end of the day, the report or research doesn't have to be exhaustive or even right...and company X still has to make its own decisions.
post #25 of 56
Product and market "boundaries" are determined by consumer buying behavior, not by the product's physical appearance. If consumers behave as though iPads and other tablets are in the same product category, then they are. If they don't, then they aren't.

Economists use cross-price demand elasticities to gauge the substitutability of one product for another in the eyes of consumers. If Company S drops the price of its tablet by 5%, let's say, and the number of tablets sold by competitor A falls little or not at all, then CONSUMERS do not consider the products of S and A to be equivalents or near-equivalents.

To illustrate: Suppose Hyundai lowers the price of its Sonata by 5%. The demand for Accords and Camrys will drop, but the demand for Corvettes and BMW 5-series sedans won't show any effect. Sonatas, Accords and Camrys are in the same market, while Sonatas, Corvettes and BMW's aren't.

Consider iPad sales over the last year. They dropped to 70 million from 71 million instead of growing by a theoretical (IDC) rate 11%, which would have taken them to 79 million. That implies a theoretical 9-million unit "shortfall" in iPad sales, which would be 9/78 = 12%. Prior to the appearance of white box tablets, iPad had the same sales price as it has today. White box tablets, however, are selling for about $100, or about 80% less than iPad.

That's enough to do a (preliminary) elasticity calculation. If one assumes that the entire 12% "shortfall" in iPad sales is attributable to white box tablet sales, the cross-price elasticity between iPads and the other tablets in this instance is about 12/80 = 0.15.

If and when the coefficient approaches 1, Tim Cook should send up a flare.
post #26 of 56
I've begun to view those Kia commercials where they say "Just ask the thousands of satisfied customers on our website" with deep suspicion since our local community website was issued with a very strong 'Cease, Desist and Remove' notice from a UK based Korean Trade organisation, regarding some very dissatisfied owners comments on our site. They even asked us to sign a declaration that there was no cached version in existence - which of course we couldn't. How the hell they found us, I'll never know, though its quite possible the Trade Organisation is purely there for that purpose and not much else.
We caved. 1frown.gif
post #27 of 56
It's all so confusing and obfuscating. It would be great if Apple had something to REALLY worry about! Instead, they continue to go from strength to strength and the opposition continues to flail about - WHY?
post #28 of 56
Quote:
Originally Posted by greatrix View Post

It's all so confusing and obfuscating. It would be great if Apple had something to REALLY worry about! Instead, they continue to go from strength to strength and the opposition continues to flail about - WHY?

Because it's hard to catch up with someone that's had a 13 year head start.
"Few things are harder to put up with than the annoyance of a good example" Mark Twain
"Just because something is deemed the law doesn't make it just" - SolipsismX
Reply
"Few things are harder to put up with than the annoyance of a good example" Mark Twain
"Just because something is deemed the law doesn't make it just" - SolipsismX
Reply
post #29 of 56
I know why the PC brigade hate Apple:

Its because Apple broke the sacred rule. "Though shall not make computers easy to use" Nerds love job security , if a computer can be made to work by Mom and Pop then they are out of a job. Nerds love to be seen as geniuses, being able to fix Windows makes them feel good and gives off an aura a of perceived cleverness. It's an ego thing! Apple could be at 99% of market share in everything and they would still denigrate everything they do. Don't sweat it. The buggers are just sad indictment on the whole techie/nerd thing mind set. They still don't understand how the Surface failed. IDC, Gartner etc, are spin merchants who are making money selling lies to Corporations and the corporate clones suck it up and sell it to their CTO and the whole circus goes on and on. Its a house of cards? at my workplace there are several WP fans who still think WP is going to succeed. It so amusing watching them squirm as it fails.
Edited by Paul94544 - 8/4/14 at 8:39am

Originally by Rickers - 2014 : Cook & will bury Apple.  They can only ride Steve's ghost so long.


History reduce Apple Watch.... to a footnote in the annals of technology - Benjamin Frost Dec 2014



Reply

Originally by Rickers - 2014 : Cook & will bury Apple.  They can only ride Steve's ghost so long.


History reduce Apple Watch.... to a footnote in the annals of technology - Benjamin Frost Dec 2014



Reply
post #30 of 56
I wouldn't be scared either. A lot of these "other" tablets are cheap $50 Big Lots specials. Once they break two weeks in or find out it's a crap non-Play App Store (only) people will realize why they should have bought an iPad.
post #31 of 56

I am a PC user and have been since MS-DOS 1.0 and proprietary systems before that. I was a support team specialist so I didn't have much choice except to use MS DOS and then Windows. Or should I say suffer at times to use. I didn't have anything against Apple, it was just that I needed to concentrate on PC systems to provide support. When the iPod came out I couldn't wait to get one. The only drawback was running iTunes on Windows. Windows doesn't play nice with well written software.  I had to have the iPhone when it was introduced. My first was the iPhone 3G. I now have the iPhone 5S. My friends and colleagues have Samsung phones. Most of them brag about them in public but privately they complain about how slow the phone is, the software that they can't get rid of, and the giant screen is beautiful to look at but it doesn't fit in their pocket.

 

There are four iPhones and two iPads in our household. After dealing with PC support all day it's nice to know that when I come home that I won't be needed for iOS support.

post #32 of 56
Quote:
Originally Posted by lkrupp View Post
 

 

Watch it, buddy. You are teetering on the brink of being labeled a racist xenophobe. <sarcasm> Gotta keep it politically correct these days.

 

It's just that if other countries start thinking in the same knee-jerk xenophobic way, US farmers, Boeing, Caterpillar, United Technologies, Dupont, GE, Monsanto, and a lot of other US companies that export stuff would be in a whole lot of trouble.  Well, maybe I don't mind that much about Monsanto. 

post #33 of 56
Quote:
Originally Posted by abazigal View Post

In a sense, I will argue that DED represents both the best and the worst aspects of Apple fanboyism.

It's rude to gloat, but DED does it so masterfully that I admit to deriving guilty pleasure from his articles. On the other hand, to be willing to spend the time to research and craft such articles, even if it is for a paid site, speaks volumes about his passion.

I don't think Apple really needs to do anything, to be honest, but their job. Samsung looks like it is starting to implode under their short-sighted decision to prioritize market share over developing a healthy ecosystem and long term profitability. Apple is only just getting started. You know this when they announced features like continuity in ios8, a feature riding on Bluetooth LE, which incidentally has been in many Apple devices since 3 years ago. That's vision, that's Apple with a plan, and I can't wait to see where Apple goes from there.

I continue debating because it just irritates me when I see blatant lies and misinformation floating around in sites like cnet. The people there aren't even interested in having a civil discussion; they are simply set in bashing Apple every chance they get, just because they can.

So while it may be an uphill battle, doesn't mean I can't fight off for as long as I can. 1smile.gif

But remember, you are not alone! There's lots of us.
post #34 of 56
These "research" companies should be regulated. No use of "others".
post #35 of 56
Quote:
That explains why Cook also said that "iPad sales met our expectations but we realized they didn't meet many of yours," an allusion to the perpetual growth percentages that analyst dream up without really articulating how such rosy numbers could possibly be achieved without causing unintended side effects, ranging from giving up dollar share in the market, to destroying Mac sales, to erasing any demand for Apple's tablets in the future.
Were Apple being run by analyst-pleasing salesmen, short term demands for ever faster growth might likely have the same detrimental impact on the company's long term viability just as it did with Acer's netbooks, with the Android 2.x tablets Samsung rushed to market in 2010, and with the Old Apple's Performas and Mac Clones back in the 1990s.
Long term Apple vs Short term Google
That same kind of short term thinking is apparent in Google's more recent efforts to dump its super cheap Asus-built Nexus 7 tablets onto the market in a bid to "grab market share."
Reminds me of an article I read awhile back. It spoke of the technology company graveyard and how it was filled with companies ran by executives who didn't know the difference between market share and profit. Attempting to continually increase market share while sacrificing profits leads to poor product quality and design. Poor customer service. Returned product. Failed company without enough money to continue business. The assets are purchased and many times the once high flying brand name appears as a special promotion. Compaq or Gateway anyone?
post #36 of 56

so how about talking about "what's really going on here ..."?

 

i think it's plain the tablet market is revealing itself to be different than smartphones. in the US and other markets that are based mainly on two year telco contracts starting with a partial down payment, most get a new phone every two years because their monthly rate does not automatically drop after that, even tho the phone itself is all paid for. and there is a real used phone sale option too (most go overseas i suppose) that can almost cover the downpayment for a new phone.

 

but consumers buying a tablet pay the full price up front. so it is not surprising they keep using it longer, probably the four years or so typical of desktop PC's - altho their average lifetimes are getting longer too. an iPad 2 is still a good tabet, good enough for many with its consistently updated OS and apps. this means that most tablet sales nowadays - iPads at least - are still first time users, or an additional household member's tablet. the replacment cycle for older iPads has not kicked in yet, but it will eventually, especially once an iOS update leaves it behind, as with the iPad 1.

 

Android tablets on the other hand are the reverse. most are running an obsolete version of Android anyway. so why not get a cheapo new one? and then their are all the throwaways, the <$100 tablets for kids and simple needs from the "other" OEM's. there is real sales volume there, but all its pricing is trapped in a "race to the bottom" that is ruinous to profit making - as Samsung's recent results clearly demonstrates.

 

if IDC et all also reported total sales revenues results instead of guesstimated unit sales, these trends would stand out. and one could calculate the average price per unit easily.  but as DED notes, that is not the story they are paid to tell.

post #37 of 56
Quote:
Originally Posted by Gatorguy View Post

Ars has a related take on the tablet market, posted up yesterday.
http://arstechnica.com/gadgets/2014/08/op-ed-tables-really-are-pcsbecause-theres-no-point-in-buying-new-ones/

I just read that article. It was was an ad for reasons to BUY an iPad. Despite the headline the article was vastly pro apple. Idk if it was intentional on the writers side to do that but that article was a +1 for iPad
post #38 of 56
I'm surprised that IDC, Gartner and Strategy Analytics are permitted by the SEC to produce fictional stats which obviously impact share prices, isn't that illegal?
post #39 of 56

Apple is a case study on what is wrong in the current Stock market environment. If you look at what we all know about Apple and its competitors and how these Analysis twist the number or create stats which tell a story, and they are getting away with it with a company which is as so above board and open, image what these guys are doing in other industries where the information is no so easily obtained. 

 

This is what you have companies like Amazon, Facebook and Google with such high valuations but when you look under the covers you start scratching your heads.

 

The Analysis hate Apple, they use to hate Steve Jobs because he would not talk to them, they just hate Apple now since Apple puts the real number out which shows the games they are playing.

 

I use get data from a Gartner Analysis and his market data was really good. He never showing things in % anything, he showed the actually numbers which you could very easily verify by looking at the various companies' 10Ks. For the companies who did not report out numbers, he would put a foot note which said it was their best estimates they had based on other information not publicly available.

 

You see now of this in the data present for Apple.


Edited by Maestro64 - 8/5/14 at 9:14am
post #40 of 56
In my household I am VP Technical Support. Since we practically no longer boot the Dell PC (2 iPads, 1 MacBook Pro, 5 iPhone 5s) the roles are reversed. I ask my kids how to do things now. loving it. 1wink.gif
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