Apple's iPad - Status Update

August 17, 2010 by Jim Davis
Six months ago I wrote an opinion piece about the Apple iPad which had, at that time, been announced but was not yet shipping. After the announcement there was a lot of analysis in the press about the shortcomings of the iPad and several predictions that it might sell poorly. Interestingly, many of the criticisms were about its hardware. These criticisms reveal\ a gaping flaw in the thinking of many analysts which has been present for over a decade.

Many whose expertise is in the PC market, have simple never learned what it is that inspires the Apple customers to be so loyal. It is not about the hardware, it is about the whole package. The hardware, the software, and how it all comes together to provide the best user experience in the industry. The problem with the PC, has never been that they are poor machines. They are not! However they are all powered by Microsoft Windows whose main problem is not that it isn't a good operating system, but that it is only 'good enough'. Software providers for the PC have, unfortunately, emulated Redmond in producing, for the most part, software that is also just good enough. While there are things which need more development, the iPad is certainly not in the category of 'just good enough'. So how has the iPad done in the last six months?

Sales

First lets look at the iPad sales. In the first 30 days one million iPads were sold. In the next 30 days Apple sold one million more iPads. After 80 days Apple had sold three million iPads, and after 90 days they had sold 3.27 million units. The main limit on sales was documented as a difficulty getting enough touch screens. Apple has been selling the iPads as fast as they can make them. After the quarter articles began emerging in the computer press indicating that the sales of NotePad computers was down. This was attributed to the success in the sales of iPads. ACIUS computers has publicly reduced their forecast for the sales of their Eee PC line and stated that it is due to the iPad.

Projections for iPad sales for the rest of the calendar year, but before it was actually available, were all over the map. Some maintained Apple couldn't possibly sell more than 5 million, which was the total number of PC tablets which sold last year. Today, with sales volume of the iPad for the first three months being known, the estimates are much more focussed. Most estimates through the end of the calendar year are between 9-12 million units. No one expected this result. Even Apple themselves has expressed astonishment at the success of their newest consumer device. My own prediction of near 20 million over 21 months will be greatly exceeded. I believed it would be a big success but I didn't expect this much, this fast.

Missing Hardware/Software

While the device is sure to change as new models are introduced, some things are probably not going to change. Much criticism was leveled against the iPad because it did not come with a camera. Now I understand how a camera might be nice on the face of the iPad for something like video chat, although I am not sure whether the processor that currently powers the device is powerful enough for that right now. Maybe this is a feature we will see in the future especially if, as some pundits have predicted, Apple starts using dual core technology in future iPads. I still believe the idea of using a thin book sized (9.56 inches by 7.47 inches) device as a camera is ludicrous. Few of us could hold such an object steady enough to get a decent picture. I would far rather use a dedicated camera, or a phone camera, and import the pictures than try to hold an iPad still to take pictures.

I argued that the omission of some of these features actually simplifies the device. While I do want to be able to print some material from the iPad, I really think that the point was to make it wireless and including a USB port just isn't in the spirit of that design. If it has a USB port people will not just hook up a RAM stick, they will also want to hook up printers, scanners and other hardware. If it is tethered it will not function as it was designed to. So I don't think we will ever see a USB port on the iPad. Furthermore, not one of the iPad users I have talked to has even mentioned the lack of a USB port to me in our conversations.

Much was said in some quarters about the lack of an SD card. It turns out that the camera kit that is available for the iPad allows the use of an SD card. So that particular objection seem to be a mute point.

The biggest ruckus by far has been the fact that the iPad will not play any Flash media. Jobs, in particular has been severely criticized for daring to take this stance. Lately much crowing has been heard from the Android phone crowd about how their cell phones will be able to handle flash in Android version 2.2. As Froyo (the code name for Android OS 2.2) has begun to be released it is interesting to note that there is no sign of Flash yet. Perhaps Jobs has a point. An early reviewer who has a Flash beta and has tried out the technology notes that sometimes it works and sometimes it bombs. It certainly isn't ready for prime time at this time.

Competition

Of course, right now, there is virtually no competition for the iPad. the few tablets that are available currently, are much bigger, much bulkier and much more expensive. This is because until recently every other tablet maker was trying to cram all of the technologies and all of the features which are associated with a full size computer into a tablet form. No one, other than Apple, has been willing to ask the tough questions about whether all of that stuff is appropriate for inclusion in the tablet form.

Of course several manufacturers have announced their intention to create and sell a tablet computer. They are all still months removed from the marketplace. What we don't know yet is whether they have understood the relevance of what Apple has omitted. Furthermore, while a tablet based on the Android OS may be simple enough to succeed, tablets based on Windows will almost certainly not be simple enough to succeed. Windows CE might work, but Microsoft has tried to reinvent CE so many times that I don't know if they can really produce an OS suitable for mobile devices. I am sure not willing to hold my breath on that possibility!

This lesson should have already been learned from history. The Apple II was an open computer standard and Apple soon learned that 'Open' in that sense meant nothing but problems for the company who originated the basic design. So when they brought out the Macintosh they closed the computer and the machine was fare easier to manage as a result. Microsoft learned the same lesson with the PC and DOS. Too many PC component suppliers, trying to cut the cost of their product, used sub-standard parts and therefore did not meet the specifications for add-on components. It was Microsoft who took the flack from failures to perform which were caused by these sub-standard cards and peripherals. The customer simply wanted to know why their new piece of hardware didn't work, and they didn't want to hear that they had been too cheap in their buying habits.

The same lesson is being relearned by the Android market with their app store. Anyone can upload an app to the Android app store. No waiting, no qualifying, just do it. Now there are reports that some of the software doesn't work or doesn't work well. Apple's insistence on vetting all apps before they are made available to the public doesn't look quite so bad.

Acus computer, as mentioned above, announced it was lowering their sales forecast for the Eee PC and indicated they thought their lower sales were due to the success of the iPAD. A couple days later their president predicted that iPad sales will drop as soon as some of the Windows and Android tablets make it to the marketplace. I find this interesting and mention it here because unless the makers of these soon-to-be iPad competitors learn the lesson mentioned in the previous paragraph those tablets will find themselves languishing on store shelves. It isn't just about turing out hardware that is about the same size and cost as the iPad. It is about the user experience!

New Market

Six months ago I suggested that the analysts were wrong about the size of the market for tablets. With the known sales volume of the iPad through the end of June there is no doubt that I was correct. Tablet sales last year were 5 million over 12 months. Apple sold 3.27 million in 3 months. At that pace they will have expanded the market by 262%. If that isn't a new market, what is?

Conclusions

Most of all it is going to be a lot of fun to watch what happens next. The main benefactor of all of this will be the consumer. Computers are going to change their form factor and display less homogeneity. I expect there to be a sharper division between machines designed to create digital content and those designed to access and display digital content. That is why my previous article focussed on that dichotomy. The computer revolution has been and interesting ride so far. Buckle up, things are going to get even more interesting from here on!


 

General
    Welcome

Desktop Publishing
    Start of Desktop Publishing

iPad
    iPad Opinion
    iPad Update

Organizational Behaviour
    The Short and Glorious History
    Management Essentials
    Motivation - A New Look
    Problem-Solving - Getting Things Done

Programming
    Radio Buttons & Check Boxes
    Variables

Theory of Constraints
    Necessary and Sufficient