iPad halves laptop sales

Best Buy CEO Brian Dunn has said that the iPad has halved sales of laptops at the popular store in an interview with the Wall St Journal.  As a result shoppers at the chain will find more tablets, e-readers and smartphones in stores and fewer desktop PCs.

The news doesn't come as a major surprise but isn't necessarily the brilliant news for Apple that you might expect.  The sudden and enormous popularity of netbooks proved that people were finally ready to take their computer and their online life with them wherever they went.  Netbooks finally gave people a form-factor small and light enough to do just that.  Now the tablet form factor is evolving this and giving people the freedom to not have to have a clamshell device with keyboard that's difficult to use unless you sit it on your lap.

For now Apple have this market all to themselves.  Despite the news that other major hardware manufacturers such as HP, Dell and Samsung were planning tablet devices over a year ago, Apple's secrecy in product development has allowed them to steal the march on their competitors.  This window, of almost a year before anyone else has been able to bring devices to market, has given Apple a huge lead.

It's going to get tough though with all types of tablet devices coming to market over the Christmas period and by the spring of 2011 there should be as many tablets available to buy as there were smartphones a year after the iPhone first launched.  What's morewith Google Android gaining popularity and market share every day, Apple will have a fight on its hands.

So where's the bad news for Apple?  Many of the early adopters who bought the iPad would have been Apple customers.  If Best Buy's results are accurate, this means that the cheaper iPad could well hit Apple's own sales of iMac computers.  If this happens we could see Apple having to price the iPad much more aggressively to build market share.  This would be good news for the consumer but potentially bad news for Apple's balance sheet and shareholders however you look at it.

Apple will need to continue to stay ahead of the game on innovation to maintain a lead and will also now probably have to promote the iMac brand more agressively too.  We'll let you know what happens.

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