Report: iPad will grow 250% in 2011 at the expense of PCs
A new report claims tablet sales will more than triple next year, but says Apple will hold on to its dominant position with the iPad, jumping from 14 million units in 2010 to 36 million next year.
The report, cited by John Paczkowski of the Wall Street Journal Digital Daily blog, was prepared by Caris & Co. analyst Robert Cihra.
"We model Apple?s iPad continuing to dominate [?] in 2011,? Cihra wrote. "iPad not only launched with phenomenal early uptake but effectively sent all wannabes back to the drawing board, delaying most competitive tablet launches well into CY11.
"Yet we now already look forward to the first iPad 2 refresh in March (i.e., establishing annual cadence for iPads in March, iPhone each June and iPods in Sept). An enormous multi-year opportunity, we continue to view iPads less about the ?product? but rather igniting an explosion toward ?thin-client? Access computing.?
Android licensees, including Acer, Motorola and possibly HTC, are expected to demo new tablets at CES, but those devices won't be ready until Google finishes Android OS 3.0 Honeycomb, which isn't expected for release until March 2011. RIM is still struggling to put its PlayBook technologies together, while HP prepares its first webOS tablet, expected to be named PalmPad. Microsoft is also believed to be attempting a second shot at launching tablets running Windows 7 at CES.
A large number of new competing mobile platforms will make it easier for Apple's iPad to stand up as an established product, with thousands of apps and mature enterprise support, in a sea of incompatible tablet designs attempting to deliver a wide range of screen sizes and other feature packages.
Tablets to expand at the expense of conventional PCs
Cihra estimates global tablet sales at 54 million in 2011, with Apple taking 67 percent market share with its iPad. That growth, he said, would come at the expense of PCs.
"We see cannibalization from ?thin-client? iPads/tablets, particularly vs. netbooks and in multi-PC homes, already growing to 1/7th the size of the overall PC market in 2011 and shaving 5 percentage points off what PC growth might otherwise have been,? Cihra wrote. PC growth, excluding tablets, is expected to drop from 14 percent this year to just 9 percent in 2011.
However, if tablets are defined as a new PC form factor they would turn the situation around, as Cihra presented graphically in the report (below).
Defining the iPad as a PC, which Microsoft's chief executive Steve Ballmer did earlier this year, also more than doubles Apple's market share and establishes the company as the largest mobile PC maker in the US and the third largest worldwide, behind only HP and Acer, and just ahead of Dell.
While the iPad is devastating growth among low end notebooks and netbooks, they haven't had a discernible impact upon Apple's MacBook sales, which have been bolstered by the recent release of the MacBook Air. Apple doesn't sell any PCs on the extreme low end, isolating it from the cannibalization other PC makers are experiencing in the wake of the iPad's release. Instead, the iPad has bolstered Apple's earnings while appearing to only offer a halo effect that supports Mac sales and growth.
The report, cited by John Paczkowski of the Wall Street Journal Digital Daily blog, was prepared by Caris & Co. analyst Robert Cihra.
"We model Apple?s iPad continuing to dominate [?] in 2011,? Cihra wrote. "iPad not only launched with phenomenal early uptake but effectively sent all wannabes back to the drawing board, delaying most competitive tablet launches well into CY11.
"Yet we now already look forward to the first iPad 2 refresh in March (i.e., establishing annual cadence for iPads in March, iPhone each June and iPods in Sept). An enormous multi-year opportunity, we continue to view iPads less about the ?product? but rather igniting an explosion toward ?thin-client? Access computing.?
Android licensees, including Acer, Motorola and possibly HTC, are expected to demo new tablets at CES, but those devices won't be ready until Google finishes Android OS 3.0 Honeycomb, which isn't expected for release until March 2011. RIM is still struggling to put its PlayBook technologies together, while HP prepares its first webOS tablet, expected to be named PalmPad. Microsoft is also believed to be attempting a second shot at launching tablets running Windows 7 at CES.
A large number of new competing mobile platforms will make it easier for Apple's iPad to stand up as an established product, with thousands of apps and mature enterprise support, in a sea of incompatible tablet designs attempting to deliver a wide range of screen sizes and other feature packages.
Tablets to expand at the expense of conventional PCs
Cihra estimates global tablet sales at 54 million in 2011, with Apple taking 67 percent market share with its iPad. That growth, he said, would come at the expense of PCs.
"We see cannibalization from ?thin-client? iPads/tablets, particularly vs. netbooks and in multi-PC homes, already growing to 1/7th the size of the overall PC market in 2011 and shaving 5 percentage points off what PC growth might otherwise have been,? Cihra wrote. PC growth, excluding tablets, is expected to drop from 14 percent this year to just 9 percent in 2011.
However, if tablets are defined as a new PC form factor they would turn the situation around, as Cihra presented graphically in the report (below).
Defining the iPad as a PC, which Microsoft's chief executive Steve Ballmer did earlier this year, also more than doubles Apple's market share and establishes the company as the largest mobile PC maker in the US and the third largest worldwide, behind only HP and Acer, and just ahead of Dell.
While the iPad is devastating growth among low end notebooks and netbooks, they haven't had a discernible impact upon Apple's MacBook sales, which have been bolstered by the recent release of the MacBook Air. Apple doesn't sell any PCs on the extreme low end, isolating it from the cannibalization other PC makers are experiencing in the wake of the iPad's release. Instead, the iPad has bolstered Apple's earnings while appearing to only offer a halo effect that supports Mac sales and growth.
Comments
Apple is so far ahead in materials design, software/OS design and the integration of all their products. I mean just look at the missteps of RIM, Google, Sony, Nokia and MS over the last year.
Me, have my iPhone 4 and a first gen intel iMac. Need a 2nd gen iPad, an ATV and an MBA and I'm done buying electronic gadgetry...that is unless Apple introduces something new in 2011!
What are the chances of that?
Hey Happy New Year to everyone!
FYI: Bought the TomTom GPS for my iPhone 4 and very, very pleased with it. My first "expensive" app and it is a joy to have it "in" my iPhone as opposed to having a stand alone GPS! (No Affiliation, just a great App!)
igniting an explosion toward ‘thin-client’ Access computing.
Can I puke now? An iPad is anything but a thin client.
Paczkowski throws around terminology as carelessly as most analysts do. Maybe tech journalists should know something about engineering and tech before they are allowed to write about it.
Go back to comedic tech fluff John. It's safer.
Apple will hold on to its dominate position with the iPad
Its dominate position, really? Sigh. At least we didn't get "it's dominate position", I suppose.
That's like saying the automobile "replaced" the horse-drawn carriage. It did, but it was a new market altogether. I don't think a tablet is going to "replace" a PC, unless, like Steve Ballmer, you think that physical keyboards are going to atrophy from notebooks. No, I think the iPad has taken off because it's NOT a keyboardless-PC. It's turning out to be a new category of computing device. If anything, I'm surprised it hasn't cannibalized the iPod Touch.
Good points...remember when they termed the iPod an "Halo" product? It seems that everything Apple makes now from desktops, laptops, iPads, iPhones are all "Halo" products....
Best
The iPad isn't cannibalizing the iPod Touch because you cannot fit an iPad in your pocket.
That's like saying the automobile "replaced" the horse-drawn carriage. It did, but it was a new market altogether. I don't think a tablet is going to "replace" a PC, unless, like Steve Ballmer, you think that physical keyboards are going to atrophy from notebooks. No, I think the iPad has taken off because it's NOT a keyboardless-PC. It's turning out to be a new category of computing device. If anything, I'm surprised it hasn't cannibalized the iPod Touch.
The iPad isn't cannibalizing the iPod Touch because you cannot fit an iPad in your pocket.
I agree with that...
Good points...remember when they termed the iPod an "Halo" product? It seems that everything Apple makes now from desktops, laptops, iPads, iPhones are all "Halo" products....
Best
Yep all Apple products glow. Sitting here in the foyer of the Omni Parker House in Boston (where we have been marooned since the blizzard - but not complaining we've had a great extended stay - even met Dr. Andrew Singer (Think C)!), the number of glowing Apple logos is amazing
That's like saying the automobile "replaced" the horse-drawn carriage. It did, but it was a new market altogether. I don't think a tablet is going to "replace" a PC, unless, like Steve Ballmer, you think that physical keyboards are going to atrophy from notebooks. No, I think the iPad has taken off because it's NOT a keyboardless-PC. It's turning out to be a new category of computing device. If anything, I'm surprised it hasn't cannibalized the iPod Touch.
The iPod touch has a very different market than the iPad. iPod touch users are much younger (13-24) than iPhone and iPad users. The difference in the cost of ownership of the three products is substantial.
Also, the pocketability of the iPod touch makes it different. Some people like to say that the iPad is just a big iPod touch, which by the specifications may appear to be so, but its actual use is not. You interact differently with the iPad because of its size and screen real estate. In a way, it's like you use a swimming pool differently than you use a bathtub.
Steve said that 7" tablets won't work. Now that I've had an iPad for a couple of months, I see his point. Rather, you'd interact with a 7" tablet differently than with the 9.7" model. The screen size is a fundamental difference. And a similarly sized notebook computer can't replace the multitouch interface.
One of the best iPad apps, Flipboard creates an interactive modus operandii that cannot be duplicated by a smaller device or a traditional keyboard-and-trackpad driven PC. Yes, there are other news apps for smartphones and perhaps some news aggregators for PCs that might approach the visual UI, however the interaction is totally different.
After about a month of ownership, the iPad irrevocably changed the way that I looked at all of my computing devices. I grab my iPod touch when I walk out the front door, yet gets zero use at home or work, just when I'm walking around. My Mac mini at home gets far less use, since couch surfing is far better with the iPad; I'll still use my computer for longer typing (like this response), plus photo editing, video editing, and a few other things, but the iPad has taken over 90% of my computing needs at home. I haven't touched my old MacBook for a couple of months, didn't even bother bringing with me on my last vacation. In a few months, I will probably donate it to charity.
Yep all Apple products glow. Sitting here in the foyer of the Omni Parker House in Boston (where we have been marooned since the blizzard - but not complaining we've had a great extended stay - even met Dr. Andrew Singer (Think C)!), the number of glowing Apple logos is amazing
Not quite the Omni Parker House, Digitalclips..but when I visit our local McDonald's, I'm seeing more and more iPhone 4's!
Best and here's hoping you get home soon!
I agree that replace probably isn't the best word. The over all point is that there will be a shift in the market. People will use tablets in the place of where in the past they might have used a second or third PC.
Agreed.
The iPad isn't cannibalizing the iPod Touch because you cannot fit an iPad in your pocket.
Please.
http://www.scottevest.com/v3_store/R...n-Jacket.shtml
Yep all Apple products glow. Sitting here in the foyer of the Omni Parker House in Boston (where we have been marooned since the blizzard - but not complaining we've had a great extended stay - even met Dr. Andrew Singer (Think C)!), the number of glowing Apple logos is amazing
I have two friends who bought MBP because they love their iPhone 4s. I have another friend who used to buy only Dells. He bought an iPhone 4 two months ago. a week later he bought three iPhone 4s, one for each of his family members. He told me that he will get a MBP
That's like saying the automobile "replaced" the horse-drawn carriage. It did, but it was a new market altogether. I don't think a tablet is going to "replace" a PC, unless, like Steve Ballmer, you think that physical keyboards are going to atrophy from notebooks. No, I think the iPad has taken off because it's NOT a keyboardless-PC. It's turning out to be a new category of computing device. If anything, I'm surprised it hasn't cannibalized the iPod Touch.
I believe you are wrong on this. The iPad will indeed kill the sales of possibly millions of PCs. Most of the people you see in WiFi locations with laptops or netbooks don't really need a PC. Email, web browsing, content viewing are perfect tasks for the iPad. In your mind you can't possibly imagine the iPad replacing a PC and you're right to a point. But the vast majority of users out there don't need the full functionality of a PC. The iPad will do everything they need it to do. In my opinion there will be a large number of people for whom the iPad is their only computing device (assuming the need to sync with a PC goes away eventually). With many families being multi-PC the iPad will replace that second or third, or fourth PC currently in the home.
not quite the omni parker house, digitalclips..but when i visit our local mcdonald's, i'm seeing more and more iphone 4's!
Best and here's hoping you get home soon!
ty
I believe you are wrong on this. The iPad will indeed kill the sales of possibly millions of PCs. Most of the people you see in WiFi locations with laptops or netbooks don't really need a PC. Email, web browsing, content viewing are perfect tasks for the iPad. In your mind you can't possibly imagine the iPad replacing a PC and you're right to a point. But the vast majority of users out there don't need the full functionality of a PC. The iPad will do everything they need it to do. In my opinion there will be a large number of people for whom the iPad is their only computing device (assuming the need to sync with a PC goes away eventually).
Good point, ikrupp....I hope this is not too much of a leap! But if Apple sold 7.5 million iPads (in the first 6 months) and one can apply that ~50% of new Apple purchases are from "switchers," then could one extend that to say a good portion (~millions) of the iPad buyers would have bought a netbook if the iPad was not produced?
Anyway, whether the above is a bit convoluted or not, safe to say the advent and success of the iPad has had some impact on Apple laptop sales but more of a deleterious impact on NetBook/PC sales.
Perhaps I'm talking in circles here! Happy new year
PS. I love it when I can work the word "deleterious" into a conversation...it sounds so "professorial!"
Can I puke now? An iPad is anything but a thin client.
Paczkowski throws around terminology as carelessly as most analysts do. Maybe tech journalists should know something about engineering and tech before they are allowed to write about it.
Go back to comedic tech fluff John. It's safer.
Even when he wrote for the SJ Mercury doing the Good Morning Silicon Valley column, he was anti-Apple. No surprise here.
Can I puke now? An iPad is anything but a thin client.
Paczkowski throws around terminology as carelessly as most analysts do. Maybe tech journalists should know something about engineering and tech before they are allowed to write about it.
Go back to comedic tech fluff John. It's safer.
You probably don't care since your main point seems to be just insulting the author in some way or another but ...
The iPad is a textbook "think client" computer in many ways.
http://en.wikipedia.org/wiki/Thin_client
I have two friends who bought MBP because they love their iPhone 4s. I have another friend who used to buy only Dells. He bought an iPhone 4 two months ago. a week later he bought three iPhone 4s, one for each of his family members. He told me that he will get a MBP
I can relate. After the 2G iphone, I went all in. MBP, iMac, iPad and Apple TV. Totally satisfied by all.
I can relate. After the 2G iphone, I went all in. MBP, iMac, iPad and Apple TV. Totally satisfied by all.
Good for you...did you get the "non-vampire" Apple rechargeable batteries for your BT keyboard and Magic Mouse?