Much-hyped iPad proves a strong draw

Ashesh Shah
April 5, 2010
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Thousands of technology aficionados who flocked to Apple’s US retail stores at the weekend to pick up the computer maker’s most important new product since the introduction of the iPhone in 2007, found ample supplies of the iPad instead of the sell-out debut analysts had predicted.

The launch performance was strong, judging by the lines and customer reactions, if not a blowout.

“Sales are going about as expected,” said Gartner analyst Ken Dulaney. “Early evaluations are mixed – some ecstatic and others pointing out real limitations of the product.”

Gene Munster, analyst at Piper Jaffray, said Apple’s ability to fulfil orders in spite of a production bottleneck suggested it might have sold 600,000-700,000 iPads – more than double his earlier estimate. Others said the remaining inventory meant Apple had overestimated demand when it limited pre-orders to two per customer.

Apple had said it wanted to produce 1m iPads per month – “clearly in excess of demand”, said Ashok Kumar, an industry analyst at Rodman & Renshaw.

“Eventually it will find a niche and a success, but it’s not going to be of the scale and scope of the iPhone.”

More important than sales chalked up is the enthusiasm of early adopters. Unlike the iPhone or iPod, which the iPad resembles in touch-screen functionality, the $499-plus gadget is a luxury rather than a must-have. More-over, it requires a separate computer during set-up.

Social networking were filled with excited posts from the Apple faithful who bought their iPads first. Buyers raved about watching streaming movies with their Netflix subscriptions, the crisp appearance of photos and the ability to surf a large-screen web with nothing but their fingers. “It’s the beginning of the end for the standard laptop,” said Brett Kacmarczyk, a 48-year-old police officer.

Some who came to look said it was not worth the price until a camera and other features were introduced. “I’m sure I’ll get one in a few months,” said Ted Smith, who owns an iPhone, in New York. “I think it fills the niche between the personal computer and the iPhone.”

A critical factor is the online marketplace for applications. Many of the most popular free apps at the weekend came from media companies, according to the running sales tally on Apple’s app store. They included a player from the ABC network and newspaper apps from the New York Times, Wall Street Journal and USA Today.

The most frequently downloaded paid apps include Apple’s Keynote presentation software and Electronic Arts’ iPad version of Scrabble, both priced at $10, and a Major League Baseball app and the Flight Control game from Firemint, both $5.

Reviews were favourable, with some exceptions. At Boing Boing, an influential blog on technology and other topics, editor Xeni Jardin said the “iPad hits a completely new pleasure spot”. But another editor of the site urged readers not to buy one: Cory Doctorow said Apple had too much control over what people could run on their machines.

Others praised the feel of the device, but said it fell short of what a laptop computer could do.

Additional reporting by Andrew Edgecliffe-Johnson and Jonathan Birchall in New York

Resource:
http://www.ft.com/cms/s/0/608b07dc-404b-11df-8d23-00144feabdc0.html

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