Your browser is out-of-date!

Update your browser to view this website correctly. Update my browser now

×

iPad 2 Can Maintain Apple Share: Analysts

NEW YORK –

The iPad 2’s performance improvements,
weight reduction, price competitiveness with
other tablets, and addition of a Verizon Wireless version
will help Apple fend off major reductions in its
commanding tablet share in the coming year in the
face of growing competition, analysts said.

Still, Apple left competitors with multiple opportunities
to chip away at its share, they said. Other tablet
makers, for example, have designed tablets for use on
the Sprint and T-Mobile networks, whereas separate
versions of the iPad 2 operate only in the AT&T and Verizon
networks. Some planned tablets from competitors
incorporate 4G HSPA+ and LTE technologies,
whereas separate iPad 2 versions will operate in the
AT&T and Verizon 3G networks. In addition, the iPad
2 still doesn’t support Adobe Flash video, the major
web-video format.

“Competitors still have a play with carriers that Apple
doesn’t support, such as Sprint and T-Mobile, and
Motorola can take advantage of LTE support at Verizon
Wireless,” said Ross Rubin, The NPD Group’s executive
director of industry analysis for consumer technology.
“Honeycomb [Android 3.0] will eventually provide
stronger competition but will need more devices and
more native tablet apps,” he added.

The dramatic thickness reduction will enhance the
visual appeal at retail, he added, and the weight reduction
of 15 percent, to 1.3 pounds, “while not as great,
will likely prove more of a boon in actually using the
device.”

The iPad 2’s improvements were in line with typical
Apple generational changes, agreed Rubin and Peter
King, touchscreen and tablet strategies director at
Strategy Analytics. Though the enhancements aren’t
magnitudes ahead of the current iPad, King said, “We
believe iPad 2 raises the bar higher even though there
were no real surprises. We all knew Apple would respond
as competitors attempted to leapfrog the current
market leader in terms of technology.”

Many of the iPad 2 improvements – such as dualcore
1GHz processor and video chat – simply match
the features of competing tablets now starting to arrive
on the market. In fact, one improvement – video chat
– operates only over Wi-Fi, while on other tablets –
including the Motorola Xoom and Galaxy Tab, it operates
over Wi-Fi and 3G.

Nonetheless, King said, “iPad 2 does enough in
terms of technical and form factor improvements to enable
Apple to affirm its competitive advantage.”

With that in mind, King expects Apple will continue
to dominate the tablet market in 2011 and 2012, though
the company’s worldwide unit shipment share will drop
to 75 percent in 2011 from last year’s 84.1 percent. “It
remains our view that the competitors are fighting with
each other this year, not with Apple,” he said.

Like other analysts, Canaccord Genuity technology
analyst Michael Walkley also believes “Apple will continue
to hold dominant market share of the fast-growing
tablet market despite increased competition.”

Walkley, who attended the iPad 2 launch in San
Francisco, said he was “impressed with both the features
and pricing of the iPad 2 relative to competing
tablet offerings announced at CES and [Mobile World Congress].”

The iPad 2, he continued, “has raised the bar relative
to competing tablets with impressive hardware
specifications, competitive pricing and the leading
software ecosystem that includes over 65,000 iPadspecific
applications.”

In addition, Walkley said, “we believe that Apple’s
pricing of the iPad 2 ($499 for Wi-Fi-only, $629 for
3G base models) will pressure sales of competing
offerings including the Motorola Xoom ($599 subsidized/$
799 unsubsidized) and BlackBerry Playbook
(expected $499) as we believe consumers will overwhelmingly
choose iPad 2 vs. other tablets at these
price points.”

Another analyst pointed out that two new iPad apps
— Garageband and iMovie — underscore Steve Jobs’
assertion at the launch event that the iPad represents
the post-PC era. The two applications have existed on
Apple computers for years, said Bryan Gonzalez of the
Entertainment Technology Center @ USC, a non-profit
consortium in the entertainment and consumer electronics
industries.

With iMovie and Garageband, NPD’s Rubin added,
“Apple showed it’s not shying away from putting
some of its most processor-intensive consumer apps
on the iPad.”

Apple plans March 11 U.S. availability of the iPad
2, which is 33 percent thinner than its predecessor
but adds new Apple dual-core 1GHz processor, dual
cameras, FaceTime Wi-Fi video chatting, iOS 4.3 operating
system and a gyroscope.

For the first time, a version with embedded 3G cellular
will be available for the Verizon Wireless network.
Separate versions will be available for GSM/HSPA
networks, including AT&T and international carriers. A
Wi-Fi-only version will also be available, like before.

Neither the AT&T nor Verizon versions operate on
those carriers’ 4G networks.

Despite its smaller size and weight, the iPad 2 maintains
its predecessor’s 9.7-inch display size with 1,024
by 768 resolution and LED backlighting.

It will be available in white and black at the same
prices as the current iPad. Prices for the Wi-Fi-only
versions start at $499 for the 16GB model. Prices for
the 3G GSM/HSPA versions for AT&T and international
carriers start at $629 for the 16GB version. The
$629 price is also the starting price for a 3G Verizon
Wireless 3G versions.

The iPad 2 ships in 26 other countries on March 25
and later in additional countries.

Also on March 11, Apple will begin offering the iOS
4.3 operating system as a free upgrade for the current
iPad, to the GSM iPhone 3G S and 4, and to the iPad
Touch third and fourth generation.

With Apple’s new A5 dual-core 1GHz processor,
the iPad 2 will deliver 9x faster graphics processing
than the company’s previous single-core 1GHz processor,
yet battery life remains the same at 10 hours,
the company said.

Featured

Close