iPad

This is yet another sign that the iPad as a product is maturing – Apple is expanding its outlet channels by adding Target stores to a short list of iPad sellers (currently you can get it at Apple stores and Best Buy). Target will be giving a 5% discount to folks holding the Target cards as of 10/17. Don’t expect to see any significant price drops yet – we’d probably have to see at least half dozen authorized brick and mortar sellers before any significant price reduction is introduced by one of them. On the other hand, given Target’s wide reach (Target has almost 2,000 stores) and the upcoming holiday shopping season it’s a win-win situation for all here (including customers)…

The story comes via Engadget…

Not much to add here – many argue that the Kindle program is struggling and this TV ad just reinforces the thesis. The video features a relaxed attractive female sunbathing next to a pool and reading on her device while a frustrated male sits next to her, holds an iPad and is unable to read due to sun glare.

The dialog goes like this:
Guy: Excause me, how are you reading that in this light.
Girl: It’s a kindle, $139. I actualy paid more for these sunglasses.

Not sure if this will help Bezos and his crew, but hey they gotta do something… One thing is for certain, the video got almost one million hits on youtube (while four previous ads got less than 300k views in ~4 months) – yet another proof that the iPad is popular and attracts attention.

I am sure many of you have seen Trefis.com and it’s glitzy interface – the site allows you view palettes of products major corporations have and to get some insight into relative (financial) importance each product has on the company’s bottom line.

I’ve played with Apple a bit – the iPad unit sales projections Trefis has are, in my eyes, a bit optimistic (30M by 2014) – but hey, Trefis allows you to modify the scenario, drop or jack up the numbers – if they are wrong – go ahead an correct them. The GUI is super nice…

Screenshots below – first the relative importance of each product to Apple:

…Trefis’ iPad Unit Sales projections:

Again, I think Trefis is a bit optimistic but still relatively aligned with some early projections that around 10M units might be sold in 2010 (see the first projections here http://ipad.org/more-on-sales-projection/)

Barclays Capital recently expressed concerns about Intel’s ability to maintain high profit margins in light of mounting external pressures – the growing market importance of the iPad certainly does not help Intel given the fact that it’s running a non Intel based processor (ARM A4). Take a look at the chart below and see how the market voted (granted that the pressure from the iPad is not the only price driver here – the market is certainly concerned about Wintel axis’ ability to maintain its marketshare – I highly doubt it)… Here is the chart:

It seems that PC World is running out of Windows related topics lately, so here is another Apple related gem (I am still puzzled here – HP reputation?!?)

Here are PC World’s Five Unreasonable Reasons to Pick an HP Tablet Over an iPad:

• Web OS
• Windows (Yes, Windows)
• The HP Reputation
• The HP Business Relationship
• Increased Competition

If you have time to burn, the source article is here

I cannot confirm this as the post refers to Chinese language post – yet, it’s an interesting view: Acer is expecting Apple’s tablet market-share to drop from almost total domination that it has today to roughly 20 to 30%. The Statement is being attributed to JT Wang, chairman of Acer.

In a Chinese-language interview with the Economic Daily News (EDN), JT Wang, chairman of Acer, said that he expects Apple’s iPad market share to drop from close to 100% currently to only 20%-30% after the tablet PC market stabilizes.

It’d be interesting to see a market sizing study and to extrapolate Wang’s number based on such an estimate… I’ll look for it…

PrintingChoice (PC) has a very nice infographic that compares magazine sales via traditional print and app channels. Long story short, PC holds (and we agree) that the reason for humble magazine sales via the apps channel (if compared to print channel) lies in the fact that the print option offers substantially lower cost on an annual basis.

To expand a bit on this – let’s take a look at the pricing difference for print and app version of Time Magazine. Buying a single issue of Time will cost you $4.99 at the newsstand, the price is the same if you get that Time issue via iTunes – simple math, all is equal here… Now, let’s say you are an avid reader and you’d like to get every single printed issue for next 12 months. The print option will set you back $20, good deal – you’d have to agree. Now, let’s assume you’d want to save a tree or two and to do so you opt to purchase every single app issue of the magazine for next 12 months – this will set you back $254 as there is no discount for the app edition of the magazine so you are paying the single issue price multiplied by number of issues you are purchasing.

The message here is simple, unless publishers (and Apple) figure out way to bring the two prices together ($20 and $254) sales of app magazines will continue to lag and the promise of app based publishing might as well never materialize.

But, rest assured that the bright sales and marketing MBAs in the publishing houses are already crafting models to change this in a way to generate more revenue – for example, People magazine started offering free iPad downloads for all folks who purchase subscription to their printed edition. It’s an interesting concept, I am sure many are about to follow…. For more details, check out the People Magazine’s iPAD FAQ on the publisher’s site…

On the same note, check out MagApps.com, a a very nice Magazine App review site indeed. The following apps are profiled (as of 8/18/10):
MagApps Reviewed App Inventory

• APC Magazine for iPad
• Arizona Key Magazine
• Athletics Weekly
• Car and Driver Magazine
• Dwell Magazine App
• Epicurious Recipes & Shopping List App
• Esquire Magazine iPhone App
• Golf Digest App
• Gourmet Live
• GQ Magazine App
• iCreate Magazine App
• Premier Guitar Magazine App
• iPlay’n Learn Parents Magazine App
• Jet Away Magazine
• Lucky Magazine Shopping App
• MacUser iPad App
• Martha’s Everyday Food iPhone App
• Men’s Health Magazine iPad Edition
• Modern Luxury – Digital Editions
• NYLON Magazine App
• OK! Magazine App
• Outside Magazine App
• Popular Science+ App
• SHAPE Bride App
• Slate Magazine
• SPIN iPhone Application
• Sports Illustrated Magazine App – SI
• TheKnot Wedding App
• TIME Magazine App for iPad
• Vanity Fair Magazine iPad App
• Vogue Stylist App
• Web Designer Magazine
• Wired iPad Edition
• Women’s Health Magazine iPhone App
• Zinio Digital Magazines

A short yet significant news on the recent purchase (or budget allocation) by the Health Ministry of Victoria (most densely populated Australian state – second largest state in terms of population – ~5.5M People) – it demonstrates that the iPad, as a business platform, has some significant room to grow. Now imagine the state of California (or New York) making a similar move – Redmond truly has a huge problem to reckon with…

Here is a short note on the planned purchase:

Health Minister Daniel Andrews today announced $500,000 for a pilot program that will deliver 500 iPads for graduate doctors in medicine, nurse practitioners and advanced practice nurses to use while treating patients in hospital.

To see the source article hit this link.

Microsoft’s CEO, Steve Balmer led the Microsoft’s Annual Meeting with Financial Analysts – and he’s simply put concerned with the reported high volume figures as it relates to the iPad sales (~1M/Month)…

Here is what he noted:

“Apple has done an interesting job,” he said. “They’ve sold more than I’d like them to sell. We think about that. So it’s our job to say: we have got to make things happen. Just like we made things happen with netbooks, we have to do that with slates. [...] Not one size fits all. Been to too many meetings with journalists struggling to set up iPads for notes.”

Given that Microsoft keeps experimenting with tablet-like devices since 2001 I am not sure if the will ever be able to catch up.

A quick note on the recent news (Jul 23) that an Oakland based law office (Scott Cole and Associates) has filed a class action suit against Apple at the US District Court/Northern District of California.

The plaintiff is seeking a jury trial in conjunction with multiple allegations of breach of law by Apple (mostly revolving around the device’s alleged overheating when used outdoors) – see below for details.

The plaintiff has posted the following their website:

After substantial investigation, Scott Cole & Associates, APC has filed a class action lawsuit on behalf of the millions of purchasers of Apple’s iPad tablet computer. Among the claims, the Complaint alleges fraud and violations of applicable false advertising laws arising out of the iPad’s tendency to overheat and cease functioning* under normal environmental conditions. (* emphasis added by IO)

You can download a full version of the filing at the following location (18 Pages, PDF): http://www.scalaw.com/cases/complaints/Baltazar.pdf

Turn to page 6 of the filing (link to PDF file above) for the key allegations – here the allegation that caught my eye (Page 6, Line 24):
21. Specifically, the iPad does not live up to the reasonable consumer’s expectations created by APPLE insofar as the iPad overheats so quickly under common weather conditions that it does not function for prolonged use either outdoors, or in many other warm conditions, for a variety of common uses such as, bot not necesarily limited to, an e-reader, email tool, web browser and/or game/entertainment unit.

This is going to be an interesting one…