Production issues with new thin display could limit Apple's initial iPad 2 supply
The new ultra-thin glass screen set to be unveiled as part of the second-generation iPad this week has "yield issues" that could result in a limited supply at launch, one Wall Street analyst has said.
Bill Shope with Goldman Sachs said in a note to investors this week that sources in Apple's overseas supply chain have indicated that the iPad 2 may be affected by production difficulties. These alleged problems could result in limited supply available at launch, for a surprising product availability that AppleInsider has heard could happen near immediately.
But while Apple may experience an initial production bottleneck, Shope also reaffirmed that Apple is not expected to experience delays in launching the iPad 2. Earlier reports suggesting a significant delay of months were separately rebuffed last week.
"It appears that Apple is once again pushing the technology envelope by making the device far thinner than the original iPad, and the iPad 2's ultra-thin glass screen is generating yield issues," the analyst wrote. "This appears to be more of a process problem as opposed to a technology problem, and we wouldn't be surprised to see volumes ramp fairly quickly as the process improves."
Shope noted that almost all of Apple's new iOS products start out with limited volumes at launch. Because of this recurring trend, he said supply constraints for the second-generation iPad "should not be a major concern" for AAPL investors.
The new iPad is widely expected to have a forward-facing camera for FaceTime video chat, along with the usual technical improvements like a faster processor and more RAM. Shope also expects the new iPad to support both GSM and CDMA wireless technology, but does not expect the product to be a 4G long-term evolution compatible device.
"As of now, we are not assuming Apple will expand the storage capacity for the iPad, which should enable the company to enjoy better product margins over time," he added.
The current financial models from Goldman Sachs project the average selling price of the iPad to be 10 percent less than the previous generation. However, he noted that iPad pricing is already more aggressive than competitors, so he does not believe a price cut is necessary for the second-generation device.
Apple is set to hold a media event on Wednesday to introduce the second-generation iPad. The event will be held at the Yerba Buena Center for the Arts in San Francisco, Calif., and AppleInsider will have full live coverage.
Bill Shope with Goldman Sachs said in a note to investors this week that sources in Apple's overseas supply chain have indicated that the iPad 2 may be affected by production difficulties. These alleged problems could result in limited supply available at launch, for a surprising product availability that AppleInsider has heard could happen near immediately.
But while Apple may experience an initial production bottleneck, Shope also reaffirmed that Apple is not expected to experience delays in launching the iPad 2. Earlier reports suggesting a significant delay of months were separately rebuffed last week.
"It appears that Apple is once again pushing the technology envelope by making the device far thinner than the original iPad, and the iPad 2's ultra-thin glass screen is generating yield issues," the analyst wrote. "This appears to be more of a process problem as opposed to a technology problem, and we wouldn't be surprised to see volumes ramp fairly quickly as the process improves."
Shope noted that almost all of Apple's new iOS products start out with limited volumes at launch. Because of this recurring trend, he said supply constraints for the second-generation iPad "should not be a major concern" for AAPL investors.
The new iPad is widely expected to have a forward-facing camera for FaceTime video chat, along with the usual technical improvements like a faster processor and more RAM. Shope also expects the new iPad to support both GSM and CDMA wireless technology, but does not expect the product to be a 4G long-term evolution compatible device.
"As of now, we are not assuming Apple will expand the storage capacity for the iPad, which should enable the company to enjoy better product margins over time," he added.
The current financial models from Goldman Sachs project the average selling price of the iPad to be 10 percent less than the previous generation. However, he noted that iPad pricing is already more aggressive than competitors, so he does not believe a price cut is necessary for the second-generation device.
Apple is set to hold a media event on Wednesday to introduce the second-generation iPad. The event will be held at the Yerba Buena Center for the Arts in San Francisco, Calif., and AppleInsider will have full live coverage.
Comments
"It appears that Apple is once again pushing the technology envelope by making the device far thinner than the original iPad, and the iPad 2's ultra-thing glass screen is generating yield issues," the analyst wrote.
This scares me. These guys usually know what they're doing, but I don't want ultra-thin glass that could be relatively easier to break if dropped to the ground.
This scares me. These guys usually know what they're doing, but I don't want ultra-thin glass that could be relatively easier to break if dropped to the ground.
The whole many-layered display-and-touch component could be thinner even if the glass is unchanged.
This scares me. These guys usually know what they're doing, but I don't want ultra-thin glass that could be relatively easier to break if dropped to the ground.
Next time you read a rumor like this and get scared bitch slap yourself in the mirror for being a sucker.
god damn- no wonder these analysts put this shit out.. mad suckers lapping it up...
"Far Thinner?" This should be interesting as the original was quite thin to begin with.
Awesome, I'm hoping for knifes edge thinness.
Next time you read a rumor like this and get scared bitch slap yourself in the mirror for being a sucker.
god damn- no wonder these analysts put this shit out.. mad suckers lapping it up...
Why bother to post at all if all you got is an insult and some swears. If you're gonna be nasty, at least be nasty on topic and in a non-personal way.
the iPad 2's ultra-thing glass screen is generating yield issues," the analyst wrote. "This appears to be more of a process problem as opposed to a technology problem"
I wonder if this will lead to a raft of consumers with broken displays who get chastised by the community for setting their iPad2s down wrong.
/sarcasm
Why bother to post at all if all you got is an insult and some swears. If you're gonna be nasty, at least be nasty on topic and in a non-personal way.
what? are we in kindergarten?
There's nothing else to be said for that kind of patsy.
Should I hold his hand and perpetuate his gullibility?
what? are we in kindergarten?
There's nothing else to be said for that kind of patsy.
Should I hold his hand and perpetuate his gullibility?
No, we're adults and part of being adult is to act in a civil manner toward one another - you know, like the Golden Rule? You have no idea about how the OP was feeling at that time yet you punched him right in the face for expressing himself.
As for holding his hand, you might try a different angle: to you he's ignorant about something that you have more knowledge of, so why not teach rather than criticize?
Perhaps they should call it "ultra-THING"! :-)
No, we're adults and part of being adult is to act in a civil manner toward one another - you know, like the Golden Rule? You have no idea about how the OP was feeling at that time yet you punched him right in the face for expressing himself.
As for holding his hand, you might try a different angle: to you he's ignorant about something that you have more knowledge of, so why not teach rather than criticize?
I see your point.
Maybe I shouldn't have treated him like a hopeless case. Here's to hoping he brings a bit more in house thinking to his brain pan as opposed to buying lock stock and barrel into anything the internet serves him.
"Far Thinner?" This should be interesting as the original was quite thin to begin with.
Except for the camel hump.
I expect the iPad 2 to start at a AU$599 price point in Australia. Especially considering the strength of the currency and $629 is such an odd price point.
I wonder if this will lead to a raft of consumers with broken displays who get chastised by the community for setting their iPad2s down wrong.
/sarcasm
I'm sure some idiot will drop it from the roof of his house, claim it was from a couple feet off the ground, and want to sue Apple for his ignorance and carelessness.
Awesome, I'm hoping for knifes edge thinness.
iPad is... Cuisine!
Except for the camel hump.
I expect the iPad 2 to start at a AU$599 price point in Australia. Especially considering the strength of the currency and $629 is such an odd price point.
This is true. I didn't care for that portion of the design but I'm sure it had its purpose.
This scares me. These guys usually know what they're doing, but I don't want ultra-thin glass that could be relatively easier to break if dropped to the ground.
I was kind of wondering about that myself as I read the article. But I've not heard of big issues with iPad glass breaking. iPhone glass yes, but not iPad. So they may feel they have some margin to work with to make the glass itself a little thinner. In addition to making the entire display component thinner as they did in the iPhone.
I hope supplies are tight. I want to make myself wait until April, and it may be hard to do if they?re sitting right there on the shelf!
The whole many-layered display-and-touch component could be thinner even if the glass is unchanged.
Just curious...
Why did you want to wait until April?