Netbook sellers need not fear the iPad, says analyst

Just 1 per cent of potential netbook buyers will choose a tablet instead

Apple's iPad won't put a crimp on sales of netbooks this year, an analyst has predicted.

With an estimated ship volume of 58 million, netbooks have made the consumer mass market grade, said Jeff Orr, an analyst with ABI Research.

"But the iPad won't be mass market -- that takes sales in the 40 million to 50 million unit range," Orr said. "For a consumer electronics device to make it mass market, and that's what the iPad is, a consumer electronics device, it has be under $200."

The least expensive iPad sells for $US499 in the U.S.

ABI and Orr estimated that approximately 8 million media tablets -- the iPad among them -- will ship during 2010. That number is actually what some Apple-watching industry and Wall Street analysts have predicted for the iPad alone. In March, for example, Gartner analyst George Shiffler projected 10.5 million tablets sold this year, with the iPad accounting for 8 million of those. Meanwhile, Brian Marshall of BroadPoint AmTech has pegged his iPad number at 7 million for 2010.

Apple claimed it sold one million iPads in the first 28 days of availability, but has not updated that number in the last two weeks.

But dent netbook sales? Orr thinks not.

"Just one percent of potential netbook buyers will be impacted by media tablets," he argued. "That's not a big number."

Assuming Orr's numbers are accurate, that would mean approximately 600,000 consumers will choose a tablet -- and not necessarily Apple's -- over a netbook.

The potential impact of the iPad on netbooks has a history. While netbook sales soared last year and before rumors of an Apple tablet picked up steam, numerous analysts and pundits predicted that Apple would be forced to move into the netbook market or cede market share gains. Apple's answer last summer was to instead reduce prices of its popular MacBook Pro line of laptops by as much as 28%.

Like many analysts, Orr sees the iPad -- or any tablet for that matter -- as neither a replacement for a netbook or a complement to one, but as more akin to a smart phone. One of the advantages of the iPad, he stressed, was its instant-on capability, something it shares with small-screened mobile devices like the iPhone or Android-powered phones.

But for the moment, mass market or not, Apple's iPad has the floor to itself, acknowledged Orr.

"The bar has been set by Apple as far as what a commercial media tablet looks like," he said. "I've been disappointed that a lot of the talk of [non-Apple] tablets at CES in January haven't materialized. They should be coming to market right about now, but it looks like some of the brands may have jumped the gun, and didn't fully understand what it takes to bring touch-based technology to market."

Some of the same debate about whether the iPad is cannibalizing sales of other hardware has spilled into the Apple ecosystem . Earlier in the week, one analyst interpreted declining iPod sales as an indication that the iPad was cannibalizing the iPod Touch; the analyst at the firm that produced the data disagreed.

"It's going to be an uphill battle by others to catch up to Apple," said Orr, referring to moves by other computer sellers, or even Asian hardware manufacturers directly, into the media tablet market. "But it's not insurmountable."

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Gregg Keizer

Computerworld (US)
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