updated 06:15 pm EDT, Tue July 20, 2010
iPad making deep inroads into business
The iPad already has a footprint in half of the companies in the Fortune 100, Apple said in the call discussing its spring results. About 50 percent of the top companies are already either using or testing the tablet for corporate use. Chief operating officer Tim Cook didn't have specific adoption rates but characterized the early acceptance at the workplace as "incredible."
iPhone adoption was also much deeper: about 80 percent of the Fortune 100 were either rolling out or specifically supporting iPhones, and 60 percent of the Fortune 500.
Apple didn't have a direct explanation for the rapid expansion into the workplace but did note that the iPad isn't following a "typical early adopter curve." Most Apple products start out slow and ramp up quickly, but at 3.27 million iPads sold the company may already be beyond that phase. The growth rate is the "fastest of any device I've ever been involved with," Cook explained.
Executives were asked about the possibility of competitors challenging the iPad, and especially 3G-capable devices that were subsidized. Apple was dismissive of the threat as it noted that the iPad's business model likely worked in its favor: the cheaper iPad data rates, as low as $15 in the US, made using a 3G iPad more tempting than a device discounted up front but with a much higher rate after. Customers also likely don't want another contract beyond their phones, Cook said.
The COO wouldn't say how split the iPad was towards 3G or Wi-Fi models, but he noted the average selling price was about $640, leaning more towards the 32GB Wi-Fi and 16GB 3G editions.
Apple's adoption is a potential major hurdle for its competitors, many of which have yet to launch and have less workplace support. Android currently has weaker Exchange and security support and lacks a similar level of corporate apps. RIM may be the most viable competitor this year if rumors of a BlackBerry tablet are true, but without this Apple may not face a significant work-grade rival until the Cisco Cius arrives in 2011.