Wednesday, September 07, 2011

#WIRELESS: "Unstoppable iPad's Only Competition Is iPhone"

With HP's quick exit from the tablet market, and lackluster sales of other tablets, Apple's main competition for the stocking-stuffing Christmas 2011 market is predicted to be the iPhone.

Even with HP announcing that it would briefly dip its toe back into the tablet production market, the iPad seems unstoppable. Specifically, the iPad is gaining from HP's quick exit from the touch-screen tablet market, with forecasters increasing their predictions for Apple's dominance. With burgeoning iPad sales to the education market just kicking off this month, and clear-sailing from its previous supply chain woes, Apple's main competition for the lucrative Christmas 2011 market may be the company's own iPhone 5, which IHS iSuppli predicts will be released this fall.

IHS iSuppli predicts that Apple will ship more than 60 million iPads in 2011, up nearly 246 percent from the more than 17 million it shipped in 2010 when supply was tight. Apple's stunning success will drive overall touch-screen tablet sales to more than 274 million units by 2015, according to the IHS iSuppli.

IHS iSuppli recently upped its forecast for Apple iPad shipments after HP's exit and the lackluster sales of other competitors like Samsung's Galaxy Tab. (Source: IHS iSuppli)

"Right now Apple's iPad is dominating the market since many of its competitors are really just getting started," said Rhoda Alexander, senior manager of tablet and monitor research for IHS. "Our research shows Apple continuing to dominate the high-end tablet market out to 2015, but we also believe that many people are just using their media tablet for email and Web surfing, which should open significant opportunities for competing tablets that are priced $100 to $150 less than the iPad."

As a bulkhead against such low-end market erosion, Alexander predicts that Apple may repeat its success in the iPhone market, where it kept the iPhone 3 in its catalog after the iPhone 4 debuted, but lowered its price by $100. Apple could similarly keep the iPad 2 around at a lower price point than the iPad 3 which is expected early in 2012. Keeping the iPad 2 around could make good business sense too, since the iPad 3 will likely be using the ultra-high-resolution retinal display, which will enable Apple to continue manufacturing the iPad 2 at significantly lower cost.
However, by 2015 Samsung, Amazon, LG and other mass market experts will likely have low-end tablets that will appeal to casual users who are mainly interested in email and web access. Even so, IHS iSuppli predicts that Apple will sell more than 120 million iPads in 2015.

In the short term, Apple is expected to lap its competition--even in developing markets like China which is expected to boost iPad sales in the first quarter of 2012 during the Chinese Lunar New Year holiday season. Plus Apple is expanding its focus on the IT market with additional support staff for corporate users accessing databases from their iPad.

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