Apple's new iPad could alter the PC upgrade cycle

Apple's new iPad could alter the PC upgrade cycle

Summary: The PC will have some serious competition this upgrade cycle. Can the latest iPad poach corporate sales?

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The PC upgrade cycle later this year---consumer and corporate---is going to be very interesting to watch given the evolution of the tablet market and Apple's next-generation iPad.

Apple unveiled its next-gen iPad, which features a high definition display, 4G and other goodies. In addition, the iPad 2 will now run $399 to start.

The more interesting data point about the latest iPad is that it rivals the laptop to some degree. If folks could get by with the iPad 2 as a laptop replacement---something I see more of in the field every day---a more powerful version can have an impact.

Related: Apple's next-gen iPad: New battlefields emergeMicrosoft's business pitch for Windows 8 depends on tabletsApple's New iPad In The Enterprise: Laptop Replacement Gets CloserThe new iPad's great but what's wrong with a good, inexpensive Android tablet? |  CNET: New iPad hands on | CNET: All CNET iPad coverage (roundup)iPad HD will surpass laptops on key features

How does this impact the PC buying cycle as Windows 8 launches?

The PC has some serious competition. If you're a corporate IT buyer the equation goes like this:

  • What workers need laptops?
  • What workers can get by with an iPad?
  • How many employees are bringing their devices to work?
  • And can those bring your own device efforts allow you to scrimp on PCs?

When Windows 7 launched the tablet market was a mere blip. Today, tablets are everywhere and Apple controls the market as a bevy of rivals have fallen short. Microsoft is betting Windows 8 tablets can bridge with the PC, but the burden of proof is on the software giant.

In other words, this won't be your standard PC upgrade cycle. Apple made the case that the tablet market will be larger than the PC industry. Apple also wasn't shy about its bet that the tablet replaces the PC in many cases.

Now if you add in two versions of the iPad the PC upgrade cycle becomes even more tricky. The enterprise could go with the iPad 2 that starts at $399 as a utilitarian device. The iPad 3 would be toted by workers as a personal unit. In other words, the iPad 2 could become the corporate worker be device.

Piper Jaffray analyst Gene Munster noted:

Similar to the company's strategy with iPhone, Apple will continue to offer the 16GB iPad 2 at $399 for the Wi-Fi only version and $529 for the 3G version. Given the Kindle Fire ($199) and several lower-priced 10" Android Tablets, we see the price reduction of the iPad 2, and the lower entry-level price for the iPad family, as a strong defensive move from Apple. Moreover, we do not see it cannibalizing iPad HD sales; rather, it expands Apple's addressable market in the rapidly growing tablet space.

Munster's punch line: Apple could deliver iPad unit growth of 40 percent over the next four years. If the overall tablet market was 450 million units in 2016, Apple could have half the market.

A lot of that growth could come from corporate users.

It's still too early to proclaim that the tablet and PC markets are converging, but it certainly looks that way. That reality means this PC upgrade cycle is going to get interesting in a hurry. For Microsoft and Intel, the PC stakes have never been higher.

Topics: Laptops, Apple, Hardware, iPad, Mobility, Tablets

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267 comments
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  • It certainly can do more...

    Apple's new iPad could end the Syrian crisis and Iran's nuclear weapon hope.
    yoroto
    • Definitely

      And bring world peace....;)
      jgoode@...
      • :)

        Apparently, some Syrian ministers started to defect from the regime today. If Apple could have release the product earlier, I don't think Mr. Putin could won the re-election...
        yoroto
      • It brought me some peace...

        As to which of my computing devices I would invest in an upgrade this year.
        My dilemma... should I buy a new laptop with Windows 8 instead of 7, or should I upgrade my old iPad 1 to the newest incarnation? Yesterday's release made it clear... my first generation iPad has now stepped aside for the latest (arrives on the 16th).

        This was an easy choice. I'm a photo fanatic and 'ol 1 was having a hard time with power-hungry image apps and high-rez images. I will now have the power to handle many more of my photo tasks.

        But what about Windows 8? Nope. My Windows 7 laptop can handle everything I throw at it. It's no slouch. It isn't bringing anything to the table which I need immediately, or can't already do.
        This turned out to be an easy choice.

        But there's always the future.
        Perhaps in 2013, 2014, or 2015 I might have a need for a Windows upgrade.
        camcost@...
      • Gentleman's Rant review of "the new iPad"

        Hilarious:

        http://www.youtube.com/watch?feature=player_embedded&v=mFzJxGwqpOU#!
        gomigomijunk
      • More than that

        It could replace brain surgeons and save money in medicine.
        Zwort
      • Attention !

        All Users will be replaced by iPads.. That's it.. Total Apple Domination. :)
        ADboy
    • ROFLMAO

      nt
      ITOdeed
    • Maybe but

      Nothing it cant raise the dead. Now again there a rumor about 666 app ;)
      Richardbz
    • Humour

      You guys are so funny! Where are you?
      30 years I've been here and not met anyone whose wit even approaches your sharpness.
      Ashtonian
    • Much more

      It will end world hunger too. people will play Angry Birds all day long and forget they are hungry.
      fldbryan@...
      • Angry Birds HD!

        --
        Patanjali
    • Plus the whole solar charger app

      The new "iPad3 only" solar app that will actually use the screen output to charge solar devices at a higher power rate than the device actually uses - this is going to end the world energy crisis as we know it and move us away from our foreign supplied oil problems. Or not.
      dagodevas
    • The world 'is' an apple indeed!

      Considering the look of the Earth from the space it is quite obvious that our world truly 'is' an apple just waiting that some crazy guy pushes the appropriate red button that will crunch a large bit out of it. So it is not surprising that Apple is now becoming a kind of commercial and technological religion.

      Now that her prophet is gone, the iPad 3 being the most recent iteration of its sacred symbol, the whole world will eventually fit into it. Be prepared and pray, brothers and sisters.

      Niark-niark.
      amicalmant
    • You forgot to mention

      That Jeff Goldblum could use it to stop an alien invasion by planting a virus into the mothership with it too! Well, just so long as the aliens don't use USB ...
      paulfx1
  • Nope!

    This will not happen because 9.7" isn't big enough for a corporate user in most cases... Crud, the minimum screen we have is 12.5 and most don't like that.
    slickjim
    • +1

      Same for my users.
      IT_Fella
      • Which of course explains a lot

        No one ever uses those smart mobiles (phones/tablets) successfully for anything resembling work, and apparently none of the corporations shelling out for them think that their employees would deign to use them for actual work purposes. And it's not as though they want to stop the gadget gravy train either considering how many of these sodding devices they're buying now and have plans to buy in the future.

        Somehow I think your concept of reality is similar to those of people who think they see pixies dancing amongst the flowers.
        ego.sum.stig
      • specialty

        @ego.sum.stig@... There will be specialty purposes but not for people with deskjobs, sorry, Not going to happen and I don't care how much pixie dust you smoke!
        slickjim
      • Mr Perry

        Pixies are imaginary creatures, unless you believe they are real. Dust however, they are not. They might produce it, but they are not it. That and plonkers like yourself who say they world isn't changing when it is, and oh do I detest mobile anything, most probably couldn't even understand said pixies instructions on making pixie dust so you can stay in your imaginary world.
        ego.sum.stig