Apple Is About to Give the Competition Another Drubbing
Going up against Apple (Nasdaq AAPL) must be akin to facing heavyweight champion Joe Lewis in the ring -- you get hit with so many blows so fast that your best option is to lie down.
Perhaps thats what Apples competitors feel like this week. While theyre still reeling from last Saturdays iPads launch, Cupertino has announced plans to offer select guests a sneak peek at the next generation of the iPhone operating system this Thursday.
Sales of the iPad had analysts rushing to revise their estimates for Apple upwards Thursdays show-and-tell might spark yet another round of optimism.
Joy to the iPad World
Analysts were burbling happily over their calculations when Apple began selling the iPad Saturday. About 300,000 iPads were sold on the first day by Apples count -- far fewer than expected -- but analysts remained unshaken in their faith.
Pointing out that the sales figures were for Saturday only and that many Apple and Best Buy (NYSE BBY) stores were closed on Easter Sunday, Brian Marshall, an analyst at Broadpoint AmTech, told MacNewsWorld that people likely would have snapped up another 200,000 or so iPads if sales had continued at a normal pace through the weekend.
I still think my estimate that four million iPads sold in calendar year 2010 is conservative, Marshall said.
The attractiveness of the iPad lies in its media and content capabilities, he told investors.
Content available for the iPad includes e-books, magazines and newspapers from most major publishers text books apps and games more than 8,500 movies and more than 55,000 TV episodes more than 12 million songs and upwards of 10,000 music videos.
Wall Street raised price targets for Apple shares on Monday based on high hopes for iPad sales. Mark Moskowitz of J.P. Morgan raised his estimate from US240 to 305, while Shaw Wu of Kaufman Bros. pumped his up from 253 to 295. Gene Munster of Piper Jaffray was more cautious, increasing his estimate marginally from 284 to 289.
Broadpoint Amtechs Marshall, Needhams Charlie Wolf, and Thomas Weisel partners Doug Reid all pegged Apples share price at 280.
A Cautionary Note
Which of these price points should investors trust Hard to tell -- but its wise not to get carried away.
Some analysts did get caught up in the iPad frenzy, notably Piper Jaffrays Munster, who predicted on Saturday that iPad sales would hit the 700,000 mark. Others pegged their target at between 500,000 and 600,000 units.
After Apple released its figures, Munster explained that hed overestimated the online pre-orders, and cut his 2010 iPad sales estimate from 5.6 million to 4.3 million.
One reason early estimates may have been off is that Apple initially did not require customers to provide credit card numbers when pre-ordering an iPad online and only began asking for them as the delivery date loomed.
That could have been a slip, which would be a first for a company thats so attentive to detail as Apple is.
Alternatively, it might have been a great marketing ploy. People would feel free not to follow through on pre-orders if they didnt have to provide their credit card numbers up front, and there would be no way to gauge the number who would fail to follow through with their pre-orders, so Apples figures quite possibly looked better than they would have if the company had insisted that people seal their deals with credit card numbers.
Of course, Apples pre-ordering methods were no secret, so analysts should have taken abandoned pre-orders into account.
Tales From the iPad Dark Side
More facts that could be troubling to investors are emerging.
For one thing, its not clear how many of the 300,000 iPads Apple claims to have sold on Saturday actually went to buyers.
Some of them went to channels, and Best Buy stores still appear to have quite a bit of inventory that likely contributed to that 300,000 figure.
Another possible problem is that many of those who bought the iPad on Saturday already own other Mac devices like MacBooks and iPhones. In other words, they were hard-core Apple fans.
What investors want to look for is the number of iPad buyers who didnt already own other Apple devices. If the iPad draws a significant number of new customers to Apple, then well have a better indication that it will really be a hit.
A separate but related issue is that of competition HP (NYSE HPQ) is flaunting its upcoming Slate, and a slew of other tablets will hit the market soon.
Heres another caveat The design of the iPad might cost it sales. Apple has engineered it to sit perfectly between the iPhone and the MacBook, Chris Hazelton, a research director at the 451 Group, pointed out.
That will make it very hard for people to buy an iPad in place of either Apple product, he told MacNewsWorld.
Happiness Is a Warm iPad
Those cautionary issues aside, its only fair to say that the universe of Apple fans is quite large and will account for hefty sales all on its own. Millions of iPhones and Apple computers have been sold, after all, and many of their owners might want an iPad.
Perhaps that is why DisplaySearch predicts that the iPad will lead tablet PC sales beyond the five million mark in 2010. Overall, tablet PCs will steal market share from netbooks and e-book readers, the company said.
The sales potential for the iPad certainly exists, said Chris Connery, vice president of market research for PC and IT products at DisplaySearch.
We showed almost 34 million netbooks shipping in 2009, and Steve Jobs likes to compare the iPad against netbooks, Connery told MacNewsWorld. If a lot of people get on the iPad bandwagon and say the iPad has all the features they want in a netbook product, that will eat into this category, which we call the mini-notebook category.
Its the Apps, Folks
Wont MacBooks and iPhones suppress iPad sales Not if developers create apps for the iPad, the 451 Groups Hazelton said.
It will be up to third-party developers to bring real value to the iPad, he explained.
Those third-party developers got a huge boost last week, when venture capitalists Kleiner Perkins Caufield Byers (KPCB) doubled its iFund to 200 million to encourage the development of mobile apps for the iPad and other Apple products.
The company also announced that iFund-supported developers are working on more than 20 apps for the iPad, and said the iPad will lead the next wave of innovation in mobile computing. The iPad will target the entertainment, communications, social networking, commerce, healthcare and education fields.
We expect all ventures to have an iPad strategy, KPCB partner John Doerr said.
There are about 3,100 apps for the iPad, of which more than 2,500 are paid apps, Mobclix spokesperson Colleen Wickwire told MacNewsWorld.
More apps are on the way, said Peter Farago, vice president of marketing for Flurry.
Flurry has seen a significant spike in developer support for the iPad since Apple unveiled the device in late January, he told MacNewsWorld.
What about Android phones, which are threatening the iPhone Not to worry.
App development is growing for both the iPhone and iPad and for Android, Farago said, but its growing faster for Apple than for Google.
The iPad as a Business Device
While consumer adoption is a good thing, the real money is to be made in the enterprise field, which is why Apple has been trying hard to get its computers and iPhones into the hands of business users.
The iPad may be embraced by businesses. Companies that have hopped onto the cloud computing bandwagon will be more likely to use the iPad because of its strong browsing capabilities, the 451 Groups Hazelton said.
Like current iPhones, the iPad can be managed by IT using Microsoft (Nasdaq MSFT) Exchange and Apples iPhone Configuration tool, he pointed out. This means that some companies may allow employees to use the iPad since it can be remotely wiped if lost or stolen, and IT can enforce the use of password protection with the device.
The iPad will likely be an employee-owned device that will be used in the office and at home, in keeping with the trend toward such devices that is gaining ground in the enterprise marketplace, Hazelton said.
Looking to Apples Q2 Report
Any time a company is in step with ongoing trends, especially if theyre expected to gain strength -- as the trends toward cloud computing and employee-owned devices are -- its likely to remain in good shape.
Apples second-quarter financial report is due April 20, and its expected to be a good one.
We believe Apples second quarter, which ended in March, was very strong, Barclay Capitals Ben A. Reitzes wrote in a note to investors Monday. We expect a solid report from the company on April 20.
That solid report might get even stronger after Apples iPhone OS announcement this Thursday. This OS will likely go into the new iPhone that will be unveiled in June.
Apples share prices closed at yet another record high on Tuesday -- 239.54, up 1.05 from yesterdays closing.
Happy investing.
Disadvantages of Apple iPad Read before You Decide to Buy New Apple iPad
Published Feb 15th, 2010 Author Crank Up
With the Apple fever swiping the world with the launch of the new iPad, there is another side to it as well. The amount of expectations that the manufacturers had brought in the minds of the people even before the release of the product in the beginning of this year is no longer being valued by the customers. The fact that the Apple iPad will replace the notebooks in the market does not seem to be a very practical statement considering its disadvantages.
Post the release of the new iPad in the market there are in fact more discussions on its disadvantages rather than its advantages. Following is the list of its known Apple iPad disadvantages in the few days of its release
- No presence of camera- Since the device does not come with a camera or a web cam, it is not possible not snap a picture or even use the video chat when chatting on your IM.
- No support for flash based applications. In other words you cannot view a website properly if it has a lot of flash based on plug-ins or is completely flash based website.
- Multi- tasking is difficult- It is merely not possible to have more than one application running at a time even for a brief span to send a quick mail or a message.
- The mini SIM slot that it comes with supports only the ATT network which means that you practically cannot go for another service provider or use it as a cell phone outside of the US.
- No support for SD card memory slots- This is one option that all Apple devices are expected to have and have not had till date.
- No built in USB slots- You could use a USB device only through an accessory which means that you have spend extra from your pocket after spending so much on your Apple iPad.
- Lack of high definition output in terms of both video and does not facilitate a comfortable reading of e-book.
Apart from the above mentioned disadvantages of apple iPad, there are also several inconveniences that the new Apple iPad has with respect to typing and battery backup and also requirement of iTunes to transfer or load any data into the iPad. This is just more of larger image of the iPod touch and does not all have the features that can replace a notebook or a mini PC.
iPad Will Impact E-Book Business Everyones
By James Kendrick Mar. 30, 2010, 1130am CDT 8 Comments
The frenzy this week in anticipation of the arrival of hundreds of thousands of iPads is as expected. Countless individuals are checking the delivery status of their iPad(s) and wishing it would just get here already. There hype is in overdrive, and its close to the time where we see if its justified or not. One of the questions being asked is how Apple will impact the e-book game with its iBooks app and iBookstore. I believe both will have a huge impact, but not just for Apples own retail operation. The iPad will be the only universal e-book reader able to buy and access paid content from all the major e-book sellers.
Amazon set the stage for iPad dominance in the e-book world with the Kindle for iPhone app. It allows customers to browse the Amazon Kindle bookstore, buy books and then read them on the phone. Those who use Kindle for iPhone praise the ability to read Kindle books without Kindle hardware. Its good for Amazon, as it is in the business of selling books, and even though Amazon would like to sell you a Kindle reader, its happy selling you books.
This is going to ramp up when the iPad hits consumer hands, and the Kindle for iPad app becomes available. The iPad will be a far better e-book reader than the iPhone, and even owners whove shied away from reading on the iPhone are going to give the iPad a try. They will discover that the iPad is a very good e-book reader, and theyll happily buy Kindle books for the iPad.
The same is going to happen with Barnes Noble, as it is in the same position as Amazon. Its reader app also allows iPhone owners to give e-book reading a try. BN is going to produce an iPad reader version, and I expect it will sell quite a few books on the slate. Thats good for iPad owners, and good for the bookseller too. The folks at Kobo will have an iPad reader like the others. Kobo is the operation running the online bookstore for Borders, and will power other bookstores too. Its iPad reader will support shopping for books along and reading them, too.
The bottom line is the iPad is going to have a tremendous impact on the e-book business, no matter what the iBookstore does. Dedicated e-book readers like the Kindle and Nook can only buy books from the sellers own store. Owners of the iPad will be able to shop at all of the major online e-book retailers. The iPad will be the only universal e-book reader that can handle paid content from just about anywhere, and that will be a game changer.
Allen Moon E-Business
How the iPad Will Change the Way You Do Business
Early reviews have been tepid, but Apples latest still demands attention from your business.
By Allen Moon March 15, 2010
On April 3, Apples long-awaited tablet computer, iPad, hits the streets. Despite the initial mixed reviews it received when it was introduced, there is no denying this new device will change the way you do web business.
Ill get to exactly how its going to do that in a moment. But first, lets take a quick look at the iPad, and its key features.
An Overgrown iPhone
When images of the iPad first came out, many observers called it an overgrown iPhone--an obvious comparison, because it looks so much like Apples popular smartphone, and shares so many of its capabilities. Like the iPhone, the iPad allows its users to send and receive e-mail, surf the Web, play music and videos, store photos, and download utilities and games from the iTunes App Store.
It also allows user to read eBooks via a reader built into the device -- making it a direct competitor to Amazon Kindle and other e-reading devices on the market with far fewer bells and whistles. However, the iPad is being marketed as more than just a tool for consuming online content. Apple has revamped its iWork suite of applications to work on the iPad as well as standard Mac notebook and desktop computers. You can use Keynote to create multimedia presentations, Pages to create word processing documents, and Numbers to create spreadsheets. And you get to do all this via the same simple touch-screen interface that iPod Touch and iPhone users love so much.
But Whos Going to Buy it
When Apple introduced the iPad, a lot of tech geeks were disappointed. The iPad didnt have a camera, and it couldnt make phone calls--two big iPhone features. And it doesnt support any sort of Flash-based programming, which puts off many designers and programmers.
But when you consider what the iPad does do, it soon becomes clear that the device just isnt meant for hardcore tech geeks. The iPad target audience is clearly people who spend most of their time on their computer doing leisure-type activities, including browsing the web, reading books, watching movies, consuming online content and interacting on social networking sites.
More specifically, the iPad is going to hold huge appeal for
People who dont like computers The iPads touch-screen interface is exceptionally easy to use. Anyone who has ever got lost moving from program to program on their computer is going to love Apples new tablet. Key demographics fitting this description include middle-aged people and senior citizens who enjoy e-mailing friends and family, surfing the web, watching videos, and sharing photos--but hate all the hassles associated with a regular computer.
People who travel The iPad is a smaller, more lightweight alternative to a traditional laptop--which makes it ultra-portable. This ensures that people will take their iPad to places you normally wouldnt imagine taking a laptop. Imagine being in a restaurant with hungry kids--kids growing restless and fidgety as they wait for their meals. Why not distract them--and save your fellow diners some frustration--with a movie or game on your iPad
Students Kids are used to lugging around backpacks crammed full of heavy, expensive textbooks--textbooks that are used for one course or semester, and then never opened again. As more textbooks get converted into an iPad-friendly format, students will flock to the Apple Store to purchase this tablet in droves.
So What Does This Mean for you
Even if you have no interest in ever buying an iPad yourself, you need to pay attention to how Apple develops and markets this device.
As the iPad and other tablet computers become more popular over the next few years, the amount of time people spend consuming online content is going to explode. If you want your internet marketing to take advantage of this emerging trend, then youll make sure your website provides them with the kind of appealing content theyre looking for.
Make sure your site has a blog that features regularly updated articles your target audience will find useful and entertaining. You can even create videos to satisfy their desire for multimedia content. And as your business grows, plan to include more interactive social media features on your site. These features are the most effective way to encourage your users to pursue an ongoing relationship with you and your other customers, and form a community around your business.
Finally, consider offering e-books. Theyre easy to produce--you can hire writers and designers to create professional-looking eBooks for you, or do it yourself. And they fit into all kinds of objectives
Main product Great if youve got an info-heavy site, and theyre almost 100 percent profit once youve paid for the initial production.
New stream of revenue You can add e-books to your site to complement what you already offer. Theyre a good upsell or standalone product.
Opt-in incentive Theyre cheap to produce so you can offer them free.
Sales tool Use them as an online sales rep, to demonstrate the value of your product. eBooks can contain text, video, audio, graphics--the whole multimedia deal.
As more people use devices like the iPad to access information online, e-books are going to become increasingly popular and widely used. Even now, the demand for good books to read via electronic reader outweighs the supply. If you want to take advantage of this new electronic information gold rush, the time to act is now. So what will you do to make your business more iPad-friendly
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