For months we have listened to analysts claim the high ground simply by predicting more and more iPad shipments. First these were generally increases in tablet shipments, partly because Apple sales were better than expected and because there were hundreds of new tablets on the launching pad, Then perversely because iPad2 came out and rival launches were all pulled, none of which analysts seemed to see coming, now analysts are saying that the Apple share of the market will be higher, but the market itself will not be quite as big. Now iSuppli is predicting less Apple iPads during 2011, merely because Apple had a tough quarter in iPads, and is now component constrained.
It’s irritating because at its third (or is it fourth) attempt, one of the largest technology market research firms has finally come up with exactly the same numbers we have been unwaveringly predicting at Rethink for tablet shipments for the past six months.
That’s the trouble with most forecasts ‘ they never predict around product transitions. Rethink did forecast precisely the timing of the iPad2 at the launch of the original iPad in an article headed ‘Message to tablet makers ‘ Eat fast, there’s a T-Rex coming.’ Unfortunately what we didn’t predict is that so many vendors (obviously they don’t read Faultline) failed to see it coming and pulled their launch windows and set them back months. So yes there will be an upside to Apple.
But if the first iPad was a T-Rex (modern theories about the T-Rex say that it was a scavenger that ate everyone’s lunch) named so because it was too big, too heavy and with a short reach, the new iPad 2 is an Anklosaurus (a little on the heavy side, well armored and with a kick in its tail). Neither product is the right size for a tablet, and the chip inside ‘ in our opinion ‘ still eats too much power ‘ hence the heavy battery syndrome.
Anyway the much improved iPad2 is now component constrained and iSuppli said that it will cut its estimate of Apple iPad shipments to 39.7 million from 43.7 million, down 4 million devices, for the year. The Rethink initial forecast carried out in October was 37.5 million.
A reduction of 9% is hardly news and iSuppli is behaving more and more like a securities analyst firm which pretends that it can predict a company’s results with more precision than the company can itself, and end up constantly having to make adjustments for things it hasn’t thought of.
Naturally iSuppli said that there will be more iPad shipments in 2012, because of the pent up demand due to the components constraints, so now it will ship 62.6 million units, up from the previous forecast of 61.6 million. This is of course nonsense. Daily there are competitive threats, new retail deals and more and more weight behind Android. iSuppli says that Other Media Tablets will overtake Apple devices during 2013 and get close in 2012.
Apple’s first-quarter supply of the iPad 2 fell far short of demand. The supply issues, iSuppli said, including quality concerns with LCD panels, shortages of the new speaker, lamination issues with one of the touch suppliers and end-unit production shortfalls. It says Apple will increase production in the second quarter, but is still falling substantially short of its target production goal for April. Some of the weaknesses of other tablets is due to Apple buying up all the touch screens it can and locking up much of the available capacity. iSuppli reports that panel suppliers report strong demand from Chinese manufacturers for twisted nematic panels which are used in tablets.