Apple's iPad Seen Cannibalizing Netbook Sales

[ICEBreaker]

It would be interesting to see the same graph but with other computer / electronic appliances of the same price range. I have a feeling that people who bought the iPad didn't feel like splurging on other items as well. The iPad is definitely a discretionary item, and people tend not to buy too many of these at the same time in the current economy.

So yeah, I think it's quite possible netbook sales got indirectly cannibalised by the iPad, and I have a feeling that other discretionary items of the same price range were hit too. Well, that's my opinion. You can't prove these things either way, unless someone went to survey iPad users directly: "Were you going to buy a netbook instead, if the iPad did not exist?"

 

[witefro]

not really cannibalizing...

Apple is not really cannibalizing [netbooks] since Apple does not make a netbook. Surely, some iPad buyers may have otherwise purchased an iPod touch or a MacBook and to this extent they are cannibalizing their own line. However, I imagine that the iPad is hurting netbook sales far more than touch/MacBook sales.

 

[benpatient]

this is a GROWTH CHART, not a SALES CHART.

i mean, come on...

 

[coldplaysucks.]

Why? It's just a bluetooth keyboard in a case. Should work as well as any other BT keybd.

Yeah, but I like the idea of having the screen up high at head level, and keeping your keyboard at hand level . . . but it seems ergonomics went out of style with the y2k bug lol

 

[awmazz]

I can totally see this as my Macbook Pro replaced my desktop computer. Now the iPad could replace what I originally got a laptop for.

In the future, I don't see myself ever getting another desktop again.

Ditto when the iMac was first introduced. There would have been an effect on sales of G3 desktops, but more than compensated for by increased overall sales from switchers etc over the ensuing years. How many people stopped using or didn't buy another iPod because their new iPhone could do the same thing?

Despite his talk of an 'in-between' product, I suspect Jobs fully expects that laptop (and even iPod Touch) sales will eventually fall by the wayside as tablets take over the mobile computing space in the next few years as they become faster and more powerful. The iPad is just the beginning, like the first iMac.

 

[ericinboston]

so netbooks were supposed to grow at 500% on average forever? they are a second or third or fourth computer for most people to be taken around anywhere they go. completely discretionary

I agree...as I and people I know have netbooks as a very discretionary product and definitely the 3rd or more "computer" in the household.

The netbooks have their place in what I call the "computer market" (as does the iPad and notebook and tablet and desktop and server have a place):

• ability to run standard, thick client apps like MS Office, iTunes, your web broswer choice, chat software, etc
• pricing beginning at $299 and likely peaking at $449
• plenty of standard i/o such as multiple USB jacks, headphone, line in, HDMI, VGA, ethernet, wireless, bluetooth
• ability to run a standard OS (XP or Win7 or Mac or Linux) that offers all the features of a computer (not iPhone) OS...such as printing, security features, standard backup/restore, file sharing, etc.
• Have a larger screen size (10-12")
• Have a real keyboard
• Real storage...160GB drives are the smallest...and I opted for a SSD when I bought my netbook 2 years ago for $299.

Sure, you can buy some Apple accessories and rack up another $100+ ($70 for keyboard and $30 for USB adapter (which only seems to work with cameras)) but then I, Mr. Consumer, ask why I should bother now that my $499 barebones iPad is now $599.


I like the iPad...and I think I will get a Rev 2...but mainly for me, it's just too expensive (and considering I have an iPhone)...If someone gave me $500 right now I'd either buy a high end Netbook or a low end Notebook ($650). That's me. And that's also a lot of other people. I think the iPad will sell well...but I believe it will ultimately fare like the iPod in that over several revisions will it rule the market....but I also don't think the iPad is in the same market category as a netbook or notebook...it really should be in a tablet category or touch-screen computing device category.

-Eric

 

[webman2k]

I don't see why people like this don't just save up, sell a few junk items and buy a $799 brand new MacBook instead. Is that too large for you?

OK, I'll bite:

Believe me, I've sold any "junk items" I have. I'm not (as of recently, long story, way off topic) in a situation where I can afford much. In fact, I got the $250 (actually $330) by selling my iPhone, which I did so I wouldn't have to pay the data plan anymore.

OS X on my dell mini 10v runs like a little dream. Web browsing and videos run JUST AS FAST as my 2 year old macbook, which has a 2.6 gig dual core. That Atom packs just enough punch for what I need. I'm not playing games on the thing, I just want a secondary laptop that I can use for browsing, facebook, youtube, etc. All of those run just as well. Perhaps it's a testament to how lean Snow Leopard is. I really have no complaints. I can imagine if Apple made the hardware, and priced it just $100 more for the premium, how many of these would sell - millions.

So, it's not about size, although I like that it's small and light, it's about price. Netbooks have always been about price, which might be one of the reasons sales are declining - the full size budget laptops are eating into the price point, slowly. I would have gotten one of those, but the dell mini 10v specifically is 100% compatible with SL, one of the few netbooks that are, and none of the full size notebooks are.

And price? A new macbook is $1000 (plus tax in most cases), my mini macbook was $250 including shipping with no tax. That's a tremendous difference if the functionality based on your needs are equal.

I'm guessing most of the people on this board, and millions others, would buy a low powered macbook mini. For Apple users, at a $350 or so price point, running OS X, would be almost an impulse buy. So what I have is the closest thing.

And to avoid confusion, I have an apple sticker covering the dell logo

 

[androiphone]

I disagree with the title the graph clearly shows that netbook sales were dropping since november and thats only because there was an increase from october (which could be from university students buying netbooks after starting uni in september/october)

also nobody thought that netbook sales were going to stay that high forever after last summer pretty much everyone who wanted a netbook had already got one so they wouldnt be wanting another one.

and there is no proof that it is specifically the ipad that is the reason that netbook sales have been decreasing since NOBODY knew that the ipad was coming out in november to january

 

[iphaedrus]

I think it's more about just having new offerings in general ... from both iPad and all other slate-type devices on the horizon. People recognize that there is a new wave of products coming out and are holding-off buying until they see where this is going.

 

[Chupa Chupa]

Yeah, but I like the idea of having the screen up high at head level, and keeping your keyboard at hand level . . . but it seems ergonomics went out of style with the y2k bug lol

 

[FoxyKaye]

Well, I can't speak for the market, but I'd definitely consider an iPad instead of an iPod Touch - especially once the iPad hits a second revision and adds a front-facing camera.

But unless Apple somehow changes course and releases an iPad device running full OS X, it would never replace my Dell Mini 9 Hackintosh netbook.

But for folks who don't need the range of portable functionality that full OS X (or Windows 7) on a netbook provides, I could see more and more iMac/iPad "bundles" being sold over time - especially for folks who have bought in to MobileMe. And in this case, these kinds of iPad sales may cannibalize either a netbook sale or a low-end notebook sale if folks would have only used these devices for Web connectivity and document editing.

 

[Chupa Chupa]

also nobody thought that netbook sales were going to stay that high forever after last summer pretty much everyone who wanted a netbook had already got one so they wouldnt be wanting another one.

Really? Is that why just about every major PC maker and a few 2nd and 3rd tiers had multiple netbook models on display at the 2010 CES. Netbooks, tablets, and 3D TVs were the "big" items companies wanted to show off.

 

[nilk]

Do you have a big screen TV? I use my 24" iMac (which, perhaps at the next iteration, I'll replace with a 27" iMac) as a de facto television to watch all non-live programming. The screen quality is far superior to any TV on the market and I can multitask while doing it. Not two feet away I have a 42" LED TV that just sits there when there isn't breaking news or a baseball game that I can't stream.

Your 27" iMac's screen is superior to any TV on the market? I assure you my 58" Panasonic V10 plasma TV (1080P) blows it away as far as picture quality is concerned. Sure, you've got more pixels, but no LCD display can compete with a good plasma TV for watching video or gaming.

I'm especially not a fan of LED backlit LCD TVs, either. I bought one and returned it before buying the plasma, because the colors were so completely wrong, had a lot of artifacts, and annoyances like the flashlight effect on dark scenes. The LED backlit displays on my MacBook Pros are fine, though, as I don't use them much for video or gaming.

I'm sure the iMac's screen is good enough, however.

 

[akm3]

As much as I would want this report to be true, any AAPL share holder knows that Katy Huberty is an idiot, and is by far the worst AAPL analyst. How she keeps her job being as ridiculously wrong as she is quarter after quarter astounds me, and listening to the earnings calls, she asks stupid questions.

So, take any report with her name on it, ignore it, and you will come out ahead in life.

 

[charlituna]

You're missing the point. The iPad has only been on sale for a month yet the slowdown happend much earlier than that.

This is not about the iPad itself taking a literal sale away from a netbook but that the idea of all these new tablets is making people reconsider the netbook.

yep. it's not cannabalizing, but capturing that potential market that never saw the point in a netbook.

It's all the media attention the iPad's been getting that's doing this, not the iPad (as a literal device) itself.

I have to disagree. Media attention, particularly of businesses using ipads, has helped. but it is the device also. People are seeing one device for many functions (just like they did with the iphone). No more Kindle, ipod, PSwhatever, day planner etc. That will appeal to many.

 

[Lesser Evets]

This is propaganda.

We all know, because those PC fans said so, that even if the Apple iPad succeeds, it fails. So come on, they are authority! Let's admit it:

Apple failed
Apple failed
Apple failed

No matter what.

Those stupid iPhones and iPods already proved to be utter failures. The iPad won't even exist soon, like Ballmer's little pad rendered in CGI.

 

[kas23]

As everyone else points out, this is a growth chart, not a sales chart. Netbook growth was not going to continue forever and growth began to fade last October. This slowing of growth has nothing to do with the iPad. It has everything to do with the maturation of the market. And it also says that Apple was about 1 year too late to the party.

However, the most interesting comment comes from 40% of people saying they are considering an iPad instead of a notebook. Apple should be pretty worried about this comment as it indicates the iPad may cannibalize their own MacBook sales.

 

[bdavis89]

Sales growth, not sales

Keep in mind that this is showing sales growth, not sales. There is a difference.

 

[E.Lizardo]

I personally don't think the iPad competes in the same market space as a netbook. However, this new iPad accessory is going to blur the line for sure.

http://clamcase.com/ Also -- YouTube video

um,it's a case with a bluetooth keyboard.How exactly does that blur the line,except maybe to my grandmother?

 

[E.Lizardo]

this is a GROWTH CHART, not a SALES CHART.

i mean, come on...

Why is everyone talking about the chart and ignoring this:

"Huberty also cites data from March showing that 44% of surveyed consumers who were planning to purchase an iPad were doing so instead of purchasing a notebook or netbook computer, the largest category of cannibalized products."

 

[pubwvj]

No surprise.

 

[gnasher729]

And price? A new macbook is $1000 (plus tax in most cases), my mini macbook was $250 including shipping with no tax. That's a tremendous difference if the functionality based on your needs are equal.

So how much did you pay for your legal copy of MacOS X that is legally installed on your "mini macbook"?

 

[bdavis89]

Why is everyone talking about the chart and ignoring this:

"Huberty also cites data from March showing that 44% of surveyed consumers who were planning to purchase an iPad were doing so instead of purchasing a notebook or netbook computer, the largest category of cannibalized products."

How many of these people already have a functional notebook or netbook computer for everyday computing needs? The iPad is a toy, its as simple as that. I would love one, but I'm not under the illusion that its going to create a more functional and easier life. Its a toy.

 

[pavelbure]

Am I the only one who hates this "cannibalization" term ? For goodness sakes, it is called PROGRESS. Every thing is eventually going to get cannibalized.

 

[kas23]

um,it's a case with a bluetooth keyboard.How exactly does that blur the line,except maybe to my grandmother?

I'd have to say that it does blur it. It blurs it because there were probably a bunch of people staying on the side-lines and not buying the iPad due to the unconventional typing experience it offers. This is now a solution to that problem. But, in effect, it turns the iPad into a netbook.