Tuesday, July 20, 2010

iPad Not Cannibalizing Macs But How About PC?

I think not. Well, not likely. That's the answer I've got to the question to the title of this post. This subject came up in today's Apple earnings call when an analyst asked about what Apple think about potential cannibalization of the Macs by iPads in the future, since today's report showed no sign this is going on. But a statement by Apple's Tim Cook, COO, seems to have set off a storm in this regard.

"Our guts tell us that this market is very big...if it turns out that iPad cannibalizes PCs, that's fantastic for us because there is a lot of PCs to cannibalize..." was what he said. However, it was merely an off the cuff statement and nothing more.

But is the iPad really capable of cannibalizing PCs?

I think the iPad, just like the iPhone and iPod, offer an halo effect rather than actually taking away PC sales and adding them to the Mac column. After all, the only way most folks these days can pick up and iPad is through Apple's website or, more directly, Apple stores.

When I walk into the Apple stores, the Mac stations and tables are just as crowded as the iPhone and iPad stations.

However, it remains to be seen if future cannibalization of Macs and PCs by iPads will happen as iPad evolve further and the lines blur ever more with each hardware update between the iPad and laptops.

I also believe there is something that Tim Cook probably didn't bring up that I think the analysts should have. And that's the impact of the iPad on netbooks. Since the announcement of the iPad, netbooks sales have stagnant. I can do the math but without hard data, it's hard to make a direct connection between the two events. But, the data presented just screams out at you.

The ASP (average selling price) as well as survey results suggest that the iPad makes a more enticing purchase, mainly as a secondary mobile computing device, than netbooks. I have a MSI Wind that was converted into a MacWind. Had the iPad been available 9 months away when I bought it, trust me, I'd pick the iPad over the netbook.

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