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MacBook Air actually eating into iPad sales?

updated 12:55 pm EST, Fri November 12, 2010

'Fully functional' device may be more appealing

The new MacBook Air may actually cannibalizing Apple's iPad sales, according to Rodman & Renshaw's Ashok Kumar. The analyst cites only "anecdotal evidence," but argues that for some people the leap in cost may be worth it. "A fully functional notebook in a very attractive form factor may be resonating more with consumers than a content consumption only device," Kumar writes in an investor memo.

If accurate, the claim would mark a reversal of trends. The iPad is generally believed to be eating into netbook and notebook sales, offering some advantages over netbooks while being cheaper than a notebook. A Microsoft executive, product management GM Gavriella Schuster, recently acknowledged the iPad's impact on netbooks.

Kumar also quotes supply chain checks as indicating that while high, iPad production may not meet the expectations of some analysts. Levels aren't expected to break more than 2 million per month by the end of the year, in contrast with other views calling for 3 million. Anyone predicting 6 million or more iPad shipments during the December quarter could be disappointed. "This shortfall will be the second quarter in a row," says Kumar.


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  1. rtbarry

    Fresh-Faced Recruit

    Joined: Aug 2001

    +16

    who writes this drivel?

    of course the Air is going to lure away some potential iPad customers. but that doesn't "reverse a trend" of iPads eating into notebook/netbook sales overall.

  1. Paul Huang

    Mac Enthusiast

    Joined: Sep 1999

    +1

    Those who are looking at the Wifi 64GB...

    Those who don't care about screen quality and don't care about spending $300 to get:

    keyboard (save $70)
    64GB of SSD (even)
    USB adapter (save $30)
    keyboard dock (save $30)
    web cam (unavailable until 2010)

    For those who are thinking about other models of iPads (3G or not), the two really are too far apart to have any impact.

  1. Bobfozz

    Fresh-Faced Recruit

    Joined: Jul 2008

    +1

    analysts own PCs

    Does Apple CARE if someone jumps/leaps/upgrades to a Mac Air? I really, really doubt it.

    Did the iTouch cannibalize the iPod?

    This guy, and others like him, are incredibly uninformed and make no attempt to figure anything out. GEE WHIZ, only producing 2,000,000 units a month--what a shame! Does this guy have ANY understanding of what 2 million of anything looks like? Put them in boxes and look at how much warehouse space they take up. Like rtbarry wrote, "Who writes this drivel?" Worse, who would want this guy making "informed" decisions for them?

    Comment buried. Show
  1. onehere

    Fresh-Faced Recruit

    Joined: Oct 2010

    -26

    Nook Color is better for $249

    Nook Color is better for reading than iPad and better for everything else than Kindle. Nook Color is better for $249. Nook Color screen is supposed to be better (less reflective) for reading than iPad thanks to new LG screen with anti-reflection coating. It allows to watch videos, listen to the music, view Office documents and PDF's. The Nook Color will not run apps straight out of the Android Market, but that does not mean it cannot run them. In fact, they have done a lot of tests on apps from standard Android smartphones and they pretty much run on Nook Color, which has Android 2.1 under the hood. (The Nook native interface and apps are just standard Android application layers.) Barnes & Noble special Nook SDK runs on top of the standard Android one and gives developers access to exclusive extensions and APIs for the Nook and its interface. So porting Android apps is not difficult. B&N says it is more like optimising them for Nook than porting them. If you prefer e-Ink screen, the original Nook is still available from BN.

  1. ggirton

    Fresh-Faced Recruit

    Joined: Nov 1999

    +8

    It's a jungle out there

    a Pad-eat-Mac, Mac-eat-Pad world. Horrific.

  1. facebook_George

    Via Facebook

    Joined: Nov 2010

    -1

    Besides having nothing to do with the topic...

    ... I'll pay attention to the Nook when someone creates a New Yorker cover using it. The Nook is the second-place finisher in a different product category, and all the Android apps in the world is not going to change that.

  1. Ryszard

    Fresh-Faced Recruit

    Joined: Apr 2010

    +4

    Simple math & logic...

    ... apparently too difficult for an "analyst."

    A quarter is 3 months x low-ball number of 2 million iPads per month = somehow those predicting 6 million shipped iPads "will be disappointed"?

    Besides, even if this "cannibalization" is true, financial analysts should be very pleased by it. It means Apple is reaping profit not from $500+ devices, but from $2,000+ devices. Alas, financial analyst geniuses have pushed the stock down today. Go figure...

  1. iphonerulez

    Fresh-Faced Recruit

    Joined: Nov 2008

    +4

    It appears that the analysts are looking for

    anything that can be used to pull down Apple's share price for the sake of manipulation. But the sad thing is that investors are going along with it. I'm guessing it's the hedge funds that are causing Apple shares to drop as soon as this sort of FUD hits the internet media. The only thing that matters at the end of the quarter should be what the total revenue is and not necessarily of one particular product falling short of targets. iPhone sales could easily go beyond expectations and carry more wait than lessened iPad sales. Or suppose there are consumers really buying MacBook Airs in place of iPads (which would be fantastic with the greater margins). These a**-hats are only making vague assumptions at this point that iPad sales will fall short since Black Friday isn't even upon us yet.

    Unfortunately Apple shares are just too volatile and I guess nothing can change that. I'm looking at today's share drop as a tiny ripple that shouldn't affect the quarter outlook at all. I just get sick of these analysts guessing at the future. Almost no other company is selling tablets in quantity, so will they get downgraded for that fact? I doubt it. Samsung cut production on the Galaxy Tab by 50% due to slumping sales. I hope the analysts are not projecting the same loss of sales for the iPad based on Tab sales. That would be very stupid.

  1. wrenchy

    Forum Regular

    Joined: Nov 2009

    0

    The Correct use


    ...of the word 'cannibalize'.

    Well done macnn editors!

  1. testudo

    Forum Regular

    Joined: Aug 2001

    -2

    Re: It appears

    It appears that the analysts are looking for anything that can be used to pull down Apple's share price for the sake of manipulation.

    That's right! It can't be actual analysis or reporting of facts or trends. Nope, must be market manipulation behind the whole thing.

    Although when some analyst hypes up Apple sales numbers, how come we never hear of that being manipulation?

    But the sad thing is that investors are going along with it. I'm guessing it's the hedge funds that are causing Apple shares to drop as soon as this sort of FUD hits the internet media.

    Yeah, because all investors buy and sell based on one person's analysis. I guess they're all just sheep. Couldn't be just some profit taking. Or standard Apple volatility. Nope.

    And I guess the 20% run up over the last 6 months was how it was supposed to be, and not part of some grand stock manipulation?

    The only thing that matters at the end of the quarter should be what the total revenue is and not necessarily of one particular product falling short of targets.

    I guess in your short-sighted world all that matters is one number. But that's not the case. Investors aren't all over Apple because they're selling some more computers. It's based on the iPhone and now the iPad. Those are the platforms Apple has been focusing a great majority of their effort on. Those are 'the future', as people would say. If those sales started to fall flat, future expectations and revenues would be impacted (as in "OMG! Could the iPad sales be dwindling because it's reached it's maximum reach? Was Steve right when he said tablets were a niche?"). And if that's the case, Apple's long-term prospects on earnings will shrink.

    Currently Apple has a P/E ratio of 20:1, which means, in simplistic terms of testudo, that Apple would need to rake in 20 straight quarters like the last to match the value of the stock at its current valuation. If investors fear those long-term prospects are not as rosy, that stock is going to start diving. And the stock market being more about feelings than actual logic, it could cause a giant ripple in Apple's share price.

    These a**-hats are only making vague assumptions at this point that iPad sales will fall short since Black Friday isn't even upon us yet.

    But since Apple tends not to offer anything but a cursory discount on their hardware (and I doubt any on such popular items such as iPads), why would you think Black Friday would push sales way higher?

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