Which iPad I’m Ordering and Why

It’s a little after 6 a.m. Eastern on Friday, March 12 as I write this post. Some two hours from now, the Apple Store will officially take orders for all iPad models, apparently with the ability to specify pickup at a local store. The store is currently down, though it wasn’t the last time I checked about an hour ago. (Trust me, I’m not awake in anticipation of buying an iPad; my work has me on an early-to-bed, early-to-rise schedule.)

Like I have with most watershed Apple products of the last decade or more, I’ll order an iPad on the day they become available. For me, this has included, but is probably not limited to, the original iMac, iBook, Airport (gray UFO!) and 5GB clickwheel iPod, and more recently the MacBook Pro, Time Capsule, MacBook Air, and of course, gen 1, 2, and 3 iPhones. Yes, yes, I’m a fanboy, but this is also part of what I do for a living.

You know by now that there are six models of the iPad, three with Wi-Fi only, three with Wi-Fi and 3G data access with the same 16GB, 32GB, and 64GB storage capacities in each model. For the sake of discussion, I’ll call them the iPad Wi-Fi and the iPad 3G, even though the 3G model also has Wi-Fi. The iPad Wi-Fi will ship on April 3, with the 3G model due some 1-2 months later. The iPad 3G carries a $130 premium over the iPad Wi-Fi across the lineup to account for costs related to the 3G access, such as a modem and antenna. Other than providing an additional type of Internet access, there don’t appear to be any differences between the iPad Wi-fi and the iPad 3G.

I’ll be ordering the top-of-the-line 64GB iPad 3G, the most expensive of the six models, but the one with the most storage capacity and both ways to connect. Why get the most expensive model when a cheaper one could suffice? Here are my key reasons:

• Storage Capacity: I’m really looking forward to iWork on the iPad, and these files will eat up precious space on the device. I use all three apps in the suite — Pages, Keynote and Numbers — on a daily basis, and I can’t wait to try them out on the iPad. Phil’s demo looked great. I’m also doing a lot of work in Internet video these days. Having video files on the hard drive that haven’t yet or won’t be encoded for Internet delivery will be very useful.
• 3G: My second favorite feature of the iPad (behind the keyboard dock) is the 3G data plans. At only $30 for an all-you-can-eat buffet of Internet bandwidth, the AT&T plan is a great deal (note that I haven’t had 3G call, connection and speed issues like many have reported). But the fact that you pay as you go and turn on and off the service from the device is killer. Say you don’t have it turned on but find yourself in a location without Wi-Fi; simply turn it on for a month, then turn it off when you’re done. Sure you pay a hefty price for a day or even a week of usage, but if you don’t use it again for a few months, you don’t pay for it. No-contract unlimited 3G Internet is a killer feature.

I expect to use my iPad extensively for client presentations. I use my MacBook Air today, and while effective for presenting to two to three people, I can imaging the iPad as an easel position will be much more elegant and effective. I also plan to use it for note-taking when I conduct usability tests. Using Numbers, I’ll be able to create input screens ahead of time based on the test plan, and quickly and easily capture data about each test and participant. The data will already be compiled, collated and ready for analysis as soon as test sessions are completed.

These are just a few of the uses for the iPad I have in mind, but the possibilities are limitless. I’d rather have the most capable model so I’m prepared for whatever opportunity arises.

 

http://theappleblog.com/2010/03/12/which-ipad-im-ordering-and-why/

Was the iPad Launch a Success?

Even though a single iPad hasn’t actually been shipped, that won’t stop the questions over the success of initial orders from being asked. Considering how Apple has positioned the iPad in the product lineup, on par with the Mac, iPod, and iPhone, Steve Jobs better have a press-release answer ready.

On Friday, Philip Elmer-DeWitt at Apple 2.0 started following people following the numbers, though whether those numbers are real or imaginary is yet to be determined. The data thus far derived has come from InvestorVillage, an Internet forum for “self-directed investors.”

By using orders numbers from an admittedly small number of purchasers, and accounting for purchases of other products at the Apple Store, the initial estimate was 51,000 in the first two hours, 74,000 after four and a half hours, and 91,000 in six hours. According to Apple 2.0, by the end of Friday the estimated number of iPad pre-orders was approximately 120,000. That’s the good news, assuming it’s true.

Apple 2.0 also passed along metrics for 110 iPads that are what you’d expect, Wi-Fi over 3G by two to one, the cheapest iPad at $499 being very popular. Somewhat surprisingly, the most expensive model, 64GB/3G at $829, was also popular but, hey, these are self-directed investors spending their hard-earned dividends that we’re talking about.

Of course, there’s another group of investors waiting for news on iPad orders. Investors in AAPL saw their fortunes rise on Friday with the stock price reaching a new high at $227, the company briefly overtaking Wal-Mart in valuation at $206 billion. Whether AAPL goes higher on Monday will likely come down to how many iPad orders there were over the weekend, but how many equals success?

Looking back at iPhone launches, a million iPads ordered would definitely be a success, probably more than all the Slate PCs with Windows sold since 2002. Don’t expect that to happen. Both the iPhone 3G and iPhone 3GS were immediately available in multiple countries. While the iPad will be available in other countries in late April, the first weekend of the month will be U.S. only, so perhaps the original iPhone would be a better comparison. Certainly, if the iPad does outsell the original iPhone, that will be the spin, but what if it doesn’t?

Everyone who wanted to order an iPad could have ordered one Friday. There were no lines at the online Apple Store. Even assuming the number crunchers at InvestorVillage got it right on Friday, it seems unlikely to me anything like 120,000 orders will be placed on successive days. For the sake of argument, let’s assume the number ordered is halved on successive days, 210,000 total over three days. 210,000 iPads doesn’t look very good compared to the iPhone launch, does it? The only thing worse would be if Apple doesn’t release any numbers.

In an interview with the New York Times last year, Jobs remarked on Amazon’s silence over Kindle sales, saying, “usually, if they sell a lot of something, you want to tell everybody.” That’s exactly why we’ve never heard about Apple TV sales, and it’s what will be the real metric for whether iPad orders were a success over the weekend. If there is silence from Cupertino, expect investors to react with wailing and selling of AAPL. More importantly for consumers, there could be an immediate drop in the price for the iPad, similar to what happened with the original iPhone shortly after launch.

I think that’s the kind of failure we can all appreciate.

 

http://theappleblog.com/2010/03/14/was-the-ipad-launch-a-success/

Analyst Estimate: 150,000 iPads Pre-Ordered Already

While the number isn’t official (Apple isn’t exactly free and easy with its sales figures), one analyst is saying that although its early yet to tell, it looks like the iPad is on track to break some pretty significant records in terms of order volume. Amateur Apple analyst Daniel Tello, who regularly outguesses the pros, is now saying that around 152,000 iPads have been pre-ordered in the first 72 hours of availability.

Tello’s approach involves extrapolating Apple web order numbers. This time around, he worked with Victor Castroll, a Valcent Financial Group analyst. Together, they surveyed a sample group and found 120 orders for 137 iPads over 58 hours beginning at 8:30 A.M. Friday morning.

From there, Tello applied a formula that subtracts non-iPad orders on Apple’s site and multiplies the resulting number by an average of 1.125 iPads per order. Finally, he added in 2,000 units for late-night hours during which time they had no data. In the end, the total arrived at was 152,000 ending at midnight on Sunday. The number doesn’t factor in iPads reserved for in-store pickup.

Tello is quick to note that even though the number seems fairly impressive for a brand new product, there was actually a huge dip in pre-order numbers following the initial day. First day sales saw 120,000 pre-orders, at a rate of around 25,000 per hour. By Sunday, that hourly rate had slowed to about 1,000. The initial spike is explained by “overexcited fanboism” according to Tello.

Based on the current numbers, Tello estimates that pre-order numbers won’t exceed much more than half a million. He anticipates when the iPad will hit the magic million-unit mark in an interview with Fortune:

My best guess, although very tentative given the early stage and few data we have so far, would be that they hit the 1 million unit milestone by the second week after it ships. But this is a very speculative guesstimate based on just a weekend of pre-orders.

To hit 1 million two weeks after shipping would be a major milestone, not only for Apple itself, but for the entire tablet market. The iPhone took 74 days before it reached 1 millions sold, and the sales numbers for the entire tablet industry is only around 3 to 4 million a year according to Engadget. Apple would then be on pace to actually double or triple the sales numbers of its entire market segment on its own in the first year of sales, if the iPad sells roughly as many units as did the iPhone in its first year.

Tello’s numbers also provide a snapshot of what kind of iPads are being sold in what quantities. The Wi-Fi only model is strongly outselling the Wi-Fi + 3G version, by a margin of almost exactly two to one. It’s not surprising given the price difference between the two, and the growing prevalence of MiFi devices that convert users’ existing cellular data plans into usable Wi-Fi. Surprisingly, storage capacities are more evenly divided, with the 16GB, 32GB and 64GB models taking roughly a third of the pre-orders each.

Remember also that these sales figures are only for the U.S. so far. International versions of the device aren’t due to go on sale until sometime in late April at the earliest. The real challenge for Apple will be the first few weeks of in-store availability, which is when the general public will be making purchases, and not just the devoted Apple faithful willing to put down a pre-order. If both international customers and the general buyer reflect anywhere near the enthusiasm of the pre-order crowd, Apple will definitely have a hit on its hands, but I’d wait till the hype effect has passed before placing any real bets about the iPad’s future success.

 

http://theappleblog.com/2010/03/15/analyst-estimate-150000-ipads-pre-ordered-already/

BlackBerry to Lose More Ground to iPhone, Android: Survey

A new survey by research firm Crowd Science brings bad news for BlackBerry maker RIM, and some good news for Apple. The company that comes out best of all, though, is Google, whose Android operating system seems poised to see some major growth in the near future.

The survey, which Crowd Science performs semi-annually, addresses smartphone brand loyalty. This time around, it found that iPhone and Android customers were well satisfied with their choice of smartphone, but that BlackBerry is hemorrhaging users badly to both of those primary competitors.

A little over 90 percent of both iPhone and Android smartphone owners plan to stay with that OS when they purchase their next device, while nearly 40 percent of BlackBerry owners said they would opt for an iPhone next time around, and 34 percent said they’d go with Android instead of a RIM device.

It’s bad news for the Waterloo, Ontario-based BlackBerry maker, and this latest survey shows that Apple isn’t exclusively to blame for the company’s steady decline. According to Crowd Science CEO John Martin:

These results show that the restlessness of Blackberry users with their current brand hasn’t just been driven by the allure of iPhone. Rather, Blackberry as a brand just isn’t garnering the loyalty seen with other mobile operating systems.

For me, the real surprise is not that many are dissatisfied with RIM, which seems to have done very little but make incremental cosmetic upgrades with its devices over the last couple of years, but that Android is nearly matching the iPhone in terms of consumer awareness and desire.

Apple still has the advantage in terms of who its customers are and what kind of money they’re willing to spend — and on what — though. iPhone owners tend to be slightly older and more affluent, and are much more likely to buy paid applications compared to other smartphone users. Android owners skew younger and less affluent, and accordingly are much less likely to spend money on paid applications. And they do download more free apps than any other user group.

Finally, the Nexus One is making a big splash, even if it isn’t selling in droves. Android awareness in general jumped six percentage points to 66 percent since the last survey period, and 32 percent of BlackBerry owners would swap their current devices for a Nexus One right away, given the chance. That number jumps to 60 percent for users of smartphones not made by Apple or BlackBerry.

While RIM is the company that should really be scared by the results of this survey, Apple shouldn’t exactly be patting itself on the back, either. Android is making steady gains, especially among current smartphone users, and they seem to have scored a special place in the hearts of young consumers, which, when combined with the 90 percent-plus brand loyalty result, could pay off huge going forward.

 

http://theappleblog.com/2010/03/16/blackberry-to-lose-more-ground-to-iphone-android-survey/

Oops: Google Denied Trademark on Android Nexus One

It's been a rough day for Google's Android phone, the Nexus One. First we learned this morning that initial sales have been far weaker than the iPhone saw when it first came out of the gate. Now it's being reported that the U.S. Patent and Trademark Office has rejected its application for a trademark on the name Nexus One.

The name "Nexus One" was ruled too close to Portland, Oregon based Integra Telecom's own registered trademark for its Nexus fixed bandwidth integrated voice and internet T1 product.

Mike Rogoway, of Portland's The Oregonian newspaper, got the following statement from Integra:

"We appreciate that the PTO is protecting our trademark rights. Integra has over $60 Million in annual revenue associated with our Nexus brand and it represents millions of new revenue for the company each year. Google hasn't contacted us since the PTO issued its objection but we hope we can work together to achieve our respective business goals."

Does that mean Google will rename the Nexus One, or that it will end up paying the trademark holder for the privilege of using the name? Google just expanded the Nexus One onto the AT&T network today.

Either way, we wouldn't be surprised if the hunt for a new name is already on. What would you suggest, readers?

It's tempting to say this is another example of the Patent and Trademark Office moving too slow, but note that Integra was granted its trademark in December 2008. The Nexus One was just release January 5, 2010.

Meanwhile, the open Android operating system marches on. XML co-creator Tim Bray announced this weekend that he has joined Google to work on Android. He called the iPhone in a blog post "a sterile Disney-fied walled garden surrounded by sharp-toothed lawyers. The people who create the apps serve at the landlord's pleasure and fear his anger."

 

http://www.readwriteweb.com/archives/google_denied_trademark_on_android_nexus_one.php

Mobile App Marketplace: $17.5 Billion by 2012

According to a study commissioned by mobile application store operator GetJar, the mobile application market will reach $17.5 billion by 2012. By then, the number of mobile application downloads will have also grown to nearly 50 billion from just over 7 billion in 2009. Although those numbers may seem high, they line up with other estimates, such as those previously reported by analysts at both Gartner and research2guidance.

The GetJar study, run by independent consulting firm by Chetan Sharma Consulting, noted that over the past year, the number of app stores grew from 8 to 38 and that there are even more in the works. Apple's iTunes store leads the way with a reported 150,000 mobile apps and 3 billion downloads to date. Google's Android marketplace is growing fast as well, and now has more than 30,000 mobile applications that run on devices like the Droid, the myTouch 3G and the Nexus One, among others.

However, as Getjar founder and chief executive officer Ilja Laurs told the BBC, feature phones should not ignored either. "It is almost as if these phones don't exist. We know smartphones are an extremely important phenomenon, but in terms of consumer mindshare and revenue share, feature phones represent 90% of the global market compared to 10% for smartphones and data cards."

He also made the bold prediction that "mobile apps will eclipse the traditional desktop Internet," even going so far as to say that "mobile devices will kill the desktop."

Just the Stats:

Here are a few other highlights from the report (via Paid Content and TechCrunch):

• The annual growth rate for mobile app downloads is 92%
• By 2012, off-deck, paid apps will be the biggest source of revenue
• In 2009, mobile operators accounted for more than 60% of apps' revenue
• By 2012, mobile operators will account for less than 23% of apps' revenue
• The app store growth (8 to 38 by 2012) is an increase of 375%
• Average app selling price is $1.09 in North America, $0.20 in South America and $0.10 in Asia
• Revenue opportunities in Europe will grow from $1.5 billion in 2009 to $8.5 billion in 2012
• Revenue opportunities in North America will grow from $2.1 billion to around $6.7 billion in 2012
• Apps are most popular in Asia where they account for 37% of global downloads this past year
• Users spent the most for apps in North America where they account for over 50% of revenue

Analysts Agree: Apps are Big Business

A report earlier this year from research firm Gartner predicted that application stores are expected to generate revenues of nearly $7 billion over the course of 2010. That figure is a combination of the $6.2 billion spent purchasing the mobile applications themselves combined with an additional $.6 billion generated through advertising revenues from in-app ads. The Gartner analysts also predicted that mobile application stores' revenue will grow to $29.5 billion by the end of 2013.

Another forecast from research2guidance estimated the smartphone application market will grow from $1.94 billion in 2009 to $15.65 billion by 2013.

Although these aren't exactly apples to apples comparisons, the overall trend is apparent: app stores are growing rapidly and generating massive revenue streams.

 

http://www.readwriteweb.com/archives/mobile_app_marketplace_175_billion_by_2012.php

Provider Fail: Vodafone Sells HTC Smartphone Loaded With Malware

Panda Security is reporting a second incident of malware on Vodafone's HTC Magic, a Google Android smart phone. it provide a clear example for how smartphones are prime targets to become botnets once connected to a user's personal computer.

The incidents provide real-world examples of how companies can inadvertently spread malware. It also raises questions about the quality assurance testing done by manufacturers and the carriers.

After the first discovery earlier this month, Vodafone said it was an isolated incident. But two days later the company announced the HTC Magic would be discontinued. Vodafone also deleted questions about the issue from its forums.

A Panda employee discovered the "Mariposa," virus after connecting it via USB her PC. Her Panda Cloud Anti-Virus software detected the malicious code, revealing that the smart phone was infected and spreading the virus to the PC.

Mariposa is a program that turns infected machines into botnets. it has infected more than 13 million computers, stealing credit card and bank log-in information.

In the second incident, an IT security expert who had bought the phone learned about the virus discovery. He decided to test his phone, using AVG anti-virus protection. Sure enough, his device also showed it had malware on it.

According to Panda Security:

This guy had also purchased an HTC Magic direct from Vodafone's official website the same week as my co-worker. He hadn't connected the phone to his PC yet, but as soon as he saw the news hurried back home, plugged it in via USB and scanned its memory card with both MalwareBytes and AVG Free. Lo and behold, Mariposa emerged again, exactly in the same way as in our original finding.

The HTC Magic has historically been sold in Europe.

 

http://www.readwriteweb.com/enterprise/2010/03/panda-security-is-reporting-a.php