iPad generated nearly 100% of media tablet revenues in 2010
Today, Gartner revealed that spending on media tablets was $9.6 billion last year. Based on Apple financial releases, iPad generated $9.566 billion in revenue during the year -- well, the three quarters the tablet was available. By that reckoning, the other media tablets generated just $34 million in revenue.
I find $34 million to be astonishing, and puts a different perspective on IDC's media tablet shipment data, which gave iPad 83 percent market share for 2010. Until real competitors emerge, iPad owns the media tablet market. Cash is king, market share is the court jester.
During Apple's fiscal 2011 first quarter, which coincided with fourth calendar quarter 2010, iPad's average selling price was $600. Prices range from $499 to $829. Apple shipped 7.331 million iPads for the quarter and 14.789 million for the year -- just in nine months. Analyst projections for second fiscal quarter are as high as 8 million, but much depends on the impact of iPad 2 shortages, which won't be known until Apple announces earnings in about three weeks.
The iPad 2 went on sale in the United States on March 11. Apple expanded sales to 25 more countries on March 25, but with only two days of availability before fiscal second quarter ended.
Meanwhile, competitors have yet to release viable alternatives. The Motorola XOOM looks promising, but owners must send tablets back to the factory for 4G upgrades. Google now claims that Android 3.0 "Honeycomb" isn't finished. (So why is it shipping on XOOM?) Perhaps this explains why the hottest new Honeycomb tablets are still months from shipping. Next month, Research in Motion will begin shipping its PlayBook tablet in volume. PlayBook will be the most immediate contender to iPad 2, and it's no coincidence RIM chose like pricing for WiFi models: $499 (16GB); $599 (32GB); and $699 (64GB).
The real question then: How much of 2011 media tablet dollars will Apple capture? Gartner predicts media tablet spending of $29.4 billion this year, with an annual average growth rate of 52 percent through 2015. If market share equaled revenue cut -- and Gartner revenue and IDC shipments show it doesn't -- Apple's take would be at least $20 billion, based on IDC's prediction iPad will capture no less than 70 percent market share this year.
Right now, the only thing I see holding back iPad is availability. Apple can't manufacture and distribute enough iPad 2s to meet demand. Then there is breadth of availability. Predecessor iPad 1 was available in 46 countries at the end of fiscal 2011 first quarter. During second quarter, iPad 2 was available in 26 countries but for 25 of them just two days. Even then, the new tablet went on sale in the United States just weeks before the quarter ended.