Morgan Stanley: “IPad on Pace to Become One of the Most Popular Mobile Devices in History”
Apple’s iPad may prove to be the fastest-ramping mobile Internet device ever, and if not that, then the second fastest, after the netbook. This according to Morgan Stanley (MS) analyst Katy Huberty, who in an adulatory research note this morning says the iPad is on track to become one of the most popular mobile devices in history.
Driving this thesis: Strong early demand for the device, iPad Internet usage patterns and evidence of netbook cannibalization (and, perhaps, a wee bit of hyperbole).
With two million iPads sold globally in under two months (see charts below; click to enlarge), Huberty’s first point is self-evident. Her second and third are worth a closer look, though.
Huberty’s analysis suggests that Apple’s (AAPL) iPad has already surpassed the Web browsing market share of Google’s (GOOG) Android and Research in Motion’s (RIMM) BlackBerry.
“Why is this important?” Huberty asks. “Web browsing is arguably the most important computing task for the average user and early adopters are realizing similar productivity levels relative to traditional PCs. Based on our experience with iPad Web browsing, we would not be surprised to see tablet daily Internet usage exceed traditional PC Internet usage in the coming years.”
Which is interesting. In Huberty’s view, the iPad is already becoming more PC than PC companion. And that transformation will likely quicken with the debut of multitasking in iOS 4 and more robust productivity and content-creation apps.
As Huberty notes, while the majority of iPhone/iPod touch downloads are gaming related (82 percent), iPad app downloads are more evenly distributed among gaming (36 percent), content (28 percent), productivity (20 percent) and utilities (16 percent).
As for netbook cannibalization, Huberty is convinced that the iPad is at least partially responsible for recent slowing in the growth of netbook sales. “While we don’t think all tablet sales will cannibalize the low-end notebook and netbook market, we continue to believe that the initial addressable market is low- to mid-range consumer notebooks, representing 120 million units annually,” she writes.
“While the iPad launched just two months ago,” Huberty adds, “we already see signs of cannibalization, mainly in the U.S. netbook market. Netbook units declined YoY for the first time in April 2010, the same month Apple launched the iPad. We attribute the slowdown to iPad sales, purchase deferrals in anticipation of future tablet launches and what looks like the saturation of the netbook market at around 10-12 percent of total PC sales.”
With that in mind, Huberty raised her estimate for calendar 2010 iPad shipments to 10 million from six million and said that Apple may well sell 15 million in calendar 2011.