iPad Presales Musings

Apparently, the iPad sold 120,000 units on the first day of sales. Sales came in at 25,000 per hour for the first two hours, but after six hours had dropped down to around 10,000 per hour. Analyst estimates for iPad sales in 2010 range from 2.0M to 7.0M for 2010 (estimates for fiscal 2010 omit the Christmas quarter and bottom out at 1.1M). So I guess it looks like the average (one can hardly call it consensus) estimate is that Apple will sell 3-4M iPads by the end of 2010. In order to hit that target, Apple needs to sell about 600 iPads per hour for the rest of the year.

If that’s true, then Apple will have something like a 70% market share in tablet computers (I’m going to optimistically guess that 2M tablet PCs of one kind or another will sell in 2010, and I’m going to generously count “hybrid” tablets — i.e. tablets with keyboards — as tablets), except that IDC (perhaps along with other self-appointed arbiters of “market share”) doesn’t consider the iPad a computer because it “doesn’t run a full operating system” (IDC Press Release — by the way, they also predict Bluray will continue to be irrelevant).

It’s interesting that by IDC’s standards a tablet with Windows 7 on it, which is a “full operating system” not really designed to be used on a tablet, will presumably count; of course if we were to consider the Kindle a tablet computer then it might give the iPad a run for its money if Amazon’s vague “millions” is to be believed.

In the end, it seems to me that the iPad is not a “full operating system” in the same sense that Mac OS wasn’t a “full operating system” in 1984-5, or Windows wasn’t a “full operating system” (so much as DOS application with plugins) until Windows NT.

So, does 120,000 presales in one day seem to indicate 3-4M is right or wrong, high or low?

Well, some random data points:

The Palm Pre’s presales were 50-60,000 in the first week. It received enthusiastic press (in no small part because the press wanted an “iPhone-killer” narrative) followed by a pretty tepid sales and sold, what? something over 1M units in six months or so.

The original iPhone sold 270,000 units in its first quarter and around 2.8M in its first three quarters (calendar 2007). There were no presales.

The iPhone 3G sold over 1M units in its first three days (in 21 countries).

The iPhone 3GS sold over a million units in its first five days (in 3 countries), and 5.2M in its first quarter.

In general, consumer sentiment towards the iPad seems to be more positive than towards the iPhone at similar stages in the marketing cycle. But there are huge differences between the two as products — the iPad isn’t strongly tied to a single carrier (the AT&T data plans don’t involve a long-term contract) so it doesn’t automatically lose sales there, on the other hand it doesn’t have a well-defined role (the iPhone, at minimum, is a phone and an iPod, so it automatically earns a spot in your briefcase or handbag — at best, the iPad is a Kindle, and a Kindle is already one more damn thing). Simply compared to the original iPhone, the iPad looks like it’s well ahead, but that’s hardly apples to apples.

One thing I will point out — the iPad has a much greater potential upside than the iPhone. If it proves to be a “must have” product, it won’t be limited by carrier contracts. But to nail a big Christmas season, Apple will probably need to refresh the product line and/or cut prices.

It’s definitely interesting to watch.

And, for the record, 64GB Wifi.

Post Script

Apparently sales fell to around 1,000 per hour over the weekend.  The guy tracking this stuff thinks that the “real” demand will be around 30,000 per weekday until launch and half that on weekends — I have no idea how he figures this (he also attributes 50% of first day sales to “rampant fanboism” despite the fact that first day buyers had the same buying patterns as later buyers — seems to me it’s simply people who knew they what they wanted and ordered as soon as they could).

Anyhoo — if Apple sells 180k iPads per week from now until 4/3 that will be over 500k presales, and if Apple maintains that rate of sales post-release it will blow out the most optimistic analyst estimates. But I don’t even know how this guy figures 30k/day is going to be sustained.