It started with netbooks–those cheap little compact laptops that were once the greatest thing since sliced bread: In the months leading up to the iPad’s launch, the growth of sales of netbooks hit a wall (see chart at right).
And now, says UBS analyst Maynard Um [great name], iPads have become such a force of nature that they’re cannibalising the whole PC industry:
“Sales of traditional notebooks appear to be feeling pressure from the iPad, causing a scramble by vendors to launch iPad-like tablets… We believe that a majority of this impact is occurring on the lower end of PC sales as the iPad is priced close enough to this range that it becomes attractive to consumers looking to make purchases within this segment. We are not sold that the iPad is purely cannibalising PC sales, as the functionality of the iPad can not yet fully match the functionality of notebook PC’s. However, consumers who purchase iPads may be more willing to delay purchases and upgrades of existing PC’s.”
Who is this bad news for?
Mainly, Microsoft and the PC hardware vendors.
Many netbooks run Linux and/or stripped-down versions of Microsoft Windows, so a slowdown in their growth did not wallop Microsoft. Regular PCs run full-fledged versions of Windows, though, so every lost sale of a PC as the result of an iPad sale is a licence fee that moves directly from Apple to Microsoft.
Dell and HP can’t be happy about this, either. And the farther ahead iPad gets in the tablet market, the harder it will be for Google’s Android to catch up (though Android has done a fine job of catching up in the smartphone market).
It’s great news for Apple, though.
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