Morgan Stanley’s Katy Huberty suggests that weak iPad sales may be here to stay, reports Business Insider.
We lower our 2014 tablet growth forecast to 12% from 26% on the back of increasing penetration rates and the lack of new, differentiated products […]
Few suppliers were able to communicate a credible argument for a growth re-acceleration this year, however Android appears to be faring better than iOS tablets on the back of lower price points and broader product portfolios.
Huberty says that slow growth is expected despite the fact that tablets are expected to continue to cannibalise the PC market, as more consumers replace PCs with tablets.
Tim Cook would probably disagree. Commenting on the sales slowdown, Cook observed that the iPad was the fastest-growing product in Apple’s history, selling twice as many units as the iPhone and seven times as many as the iPod in the same time periods.
Despite an overall trend for flat iPad sales, Canalys recently reported that Apple remains the world leader in combined PC and tablet sales.
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“however Android appears to be faring better than iOS tablets on the back of … broader product portfolios.”
Lolwut? Just what the heck are they doing that iPads don’t do?
Sell cheaply
And how has selling cheaply worked with the iPhone? Look at China, the interest is not in the less expensive product, but the more. iPad? A possible radical departure from the initial iPad market to a subset of the product category that leads in a completely new direction is what will be a new product and definition of the market builds from the iPad into new space. You bring the early adopters along, the buyers of coolness and build market divergence along with acceptance. Sell cheaply does not create the kind of revenue you need to create new product categories and innovation. This doesn’t mean downward pricing is not a trend, but not on the scale of most business models with Apple and they get away with it.
Indeed. But that is the difference.
Placing product volume above all else.
Selling cheap often, in price and quality, and many different brands’ many different products against one company’s excellence
Why on earth would you ever spend much time considering what these investment and brokerage house pundits say? My youngest son is an economist and he clearly thinks these prognostications make no sense when you have no clear vision as to what is next in innovation and market appeal. The best you can do is identify the trends, future economic projections and make some estimated view of consumer interest in a new product. Even then, developing and quickly defining a new product category may throw your predictions off. Who knows would could be next that will redefine the iPad/Tablet space? It is the marketplace that determines acceptance and that is not predictable. Apple is not predictable in large measure, but they too could become “stale.” We all heard that the iPhone was at an end, but look at the sales numbers and margins. So what will be the new defining product? Here is where the real guessing game begins and ends.
Just like that, Morgan Stanley has passed judgment on future iPad sales. Undoubtedly growth has slowed but I think if more schools in the U.S. got on board with replacing paper books with iPads, Apple would definitely be able to greatly increase iPad sales. Also, there is the time factor of the replacement cycle. It may take every couple of years for the upgrade cycle to happen so Apple will have lean years and bountiful years of iPad sales in the future. It’s funny how these analyst idiots gave the Windows netbook platform an unlimited future and yet they were so wrong when it fizzled in a year after the iPad was introduced. I suppose these analysts are now claiming Chromebooks as having an unlimited future because they’re dirt-cheap. These analysts make me sick with their know-it-all attitudes. To Wall Street the only thing that matters is how cheap products can sell in quantity. This is despite almost no company is making any real profit from them. There has to be some point where Android tablet manufacturers have to give up if they’re not making anything from selling tablets.
iPad buyers on the whole do not seem to be as moved to upgrade as iPhone buyers. This is no surprise, considering the world of incentives and accommodations that have existed each year for upgrading your iPhone.
Even hardcore Apple fans, people that own an iPhone and upgrade it every year to the new model, are not necessarily doing the same thing with their iPad. Its more of an every other year upgrade cycle, if that.
Upgrades to the existing user base are huge part of Apple device sales. Most of the stats Apple has put out over the years show average numbers somewhere around 50% new-to-iDevice vs. Upgrade for each launch. So it stands to reason if people are keeping iPads longer and not upgrading to each generation, sales are going to be lower.
That point can’t be overstated, as it can all by itself account for the sales numbers.
This is spot on! I am an avid purchaser of Apple products! I have the latest Apple TV, Retina Macbook Pro, and iPhone. My iPad… is an iPad 2. I just haven’t seen enough incentive to upgrade. Siri? On iPad? Who cares! Faster processor? I’m not using my iPad for anything that requires it! It is basically a portable entertainment center for me (small games, web browsing, and videos).
I think A LOT of people are sticking with their iPad 2! The only thing I want from the current model is the Retina display… But that’s not enough to make me upgrade. Maybe the next version will do it for me (and others who are still holding out for an upgrade-worthy version)…
if they have a 13″ ipad with retina screen i will buy it.
morgan stanley is more used to paying fines for fraud and ‘irregularities’ so their opinion means diddly squat to me.
yes lots of cheap androids sell a lot of them are hardly used, but asia is full on no name android devices with crappy specs, i think many would choose the real thing but $$ are not a choice for some, they just don’t have it.
does apple need to be no 1 in any market? no, the best? yes.