Who Bought the First iPads?

Most of the people who lined up in New York and Minneapolis to purchase the iPad on Saturday were already committed Apple users, according to the results of a survey of 448 iPad buyers by Piper Jaffray analyst Gene Munster.

Fully 74 percent of respondents were Mac users (26 percent presently ownanother kind of PC). About 66 percent own iPhones.

As far as intended application use, 74 percent planned to use their iPads to surf the Web; 38 percent to read books; 32 percent to e-mail; 26 percent to watch video; 18 percent to play games and other apps; eight percent to listen to music.

Munster apparently believes Apple has successfully created a new niche between the smartphone and laptop. Some of us are not yet convinced of that. The overwhelming percentage of respondents think they will use their iPads as they would use their laptops or PCs: to surf the Web. The 38 percent who plan to read books are using the iPad as an e-book reader. The other notable application interests also are routinely conducted on existing devices such as MP3 players, PCs or laptops.

About all one properly might conclude is that initial early adopters are Apple enthusiasts. Many of use would guess that people aren't yet sure what they really will do, and how the device might ultimately be positioned in the broader mobile consumer electronics arena.

At least so far, half of the intended positioning seems to be clear, though. Nobody thinks the iPad replaces their smartphone. The key question remains whether iPad represents a new category, or reshaping of an existing category (namely PCs and laptops or netbooks).

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How Long to Post-Recession Job Levels? Expect Huge Merger Wave in Any Case

So what does this chart showing job recoveries after recessions since World War II suggest to you (Click on image for larger view)?

Obviously, the immediate past recession was more costly in terms of jobs than any comparable recession since WWII.

The discouraging question is whether the job recovery curve looks more like the shallow "U" shape of the 2001 recession or all the others, which are "V" shaped.

You can make your own decision about which curve will manifest itself this time. But logic suggests the recovery will take a while, simply because the curve already looks more like 2001 than any of the other curves. Also, none of the other recoveries had to face the financial headwinds imposed by our shocking, and growing, deficits, which will crowd out private capital that is the fuel for business growth.

A rough guess, given the depth of losses, which are twice that of the 2001 recession, suggests it might take twice as long for the economy to return to the level of jobs it had when the recession started. That would be 40 months, or roughly 3.3 years from today.

But that assumes no additional fiscal drag from the deficits, and nobody seems to think that is reasonable. So some believe it might take six to eight years. As one might assume, this will make for sluggish sales growth.

In a business such as telecommunications, which irrespective of the recession was in the throes of a massive transformation of its core business model, which will in any case require replacement of perhaps 50 percent of its existing current revenue by new sources over a 10-year period, and perhaps another 50 percent of revenue over perhaps a 20-year period.

Those would challenges enough for virtually any industry, without the pressure of sluggish job and housing growth and high structural deficits. Normally, sluggish growth in the telecommunications business has lead to mergers and acquisitions, since one way to obtain growth in a sluggish market is to buy that growth in the form of acquired customer bases, revenues and assets.

One has to expect quite a lot of that in this environment.

Resurrexit Sicut Dixit

"Has arisen as he said." Happy Easter.

Mobile for the Next Billion Users

Is it possible that simple tools, such as low-cost mobile phones, can have more positive economic and social impact than our typical large-scale government-to-government and typical development aid efforts? The aid establishment might not like the question, or the answers, but MIT NextLab project staff seem to believe the answer is "yes."

“Traditional aid does little for the very poor,” says Jhonatan Rotberg, founder and director of the NextLab program. “Only a fraction of the donated money trickles down to those who need it most."

"But with a mobile phone, poor people can get ahead," he says.

By any measure, recent progress, especially over the past few years, has been quite dramatic: mobile cellular penetration in developing countries has more than doubled since 2005, when it stood at only 23 per cent.

Last year, mobile cellular penetration in developing countries passed the 50 per cent mark, reaching an estimated 57 per 100 inhabitants at the end of 2009. Even though this remains well below the average in developed countries, where penetration exceeds 100 per cent, the rate of progress is remarkable.

Android might be the next big evolution, not that voice and text messaging are propagating. Using Android, devices could be customized for any number of applications that might otherwise be run on a PC, an important development in markets where device cost and access to electricity are issues.

Already, over four billion mobile phones are in use in the world today. The next billion new users, Rotberg says, will be spread out in the developing countries, mainly in Africa and Asia. Android could be important in that regard.

http://www.xconomy.com/boston/2010/03/31/mits-nextlab-designing-technology-for-the-next-billion-mobile-phone-owners/?single_page=true

Is Apple the New and Most-Important Gatekeeper?

Is Apple now more a transformative force in technology-using businesses than Google? Some observers have pointed out that it is possible, perhaps even likely, that Apple's equity value will exceed that of Microsoft in the near future. But Apple now is worth more than Google, with a market capitalization around $214 billion, compared to Google's $159 billion.

To be sure, content companies tend to pay more attention to Apple's moves, while communication companies tend to pay more attention to Google. One might argue that in the communications business, Apple mostly has changed the handset business, and user expectations about what can be done with handsets.

It likely will wind up being more transformative than that. Apple has proven that mobile application stores can be a source of huge end user value in the mobile ecosystem, and potentially a huge driver of revenue and margin in a business that is shifting inexorably towards applications as the driver of communications value overall.

Keep in mind that Apple previously redefined the online music business, if not the whole music business, by some estimates. Apple has had less success in the video arena, but the iPad could signal a potential shift of distribution in the print content business, or at least Apple has been arguing that is its objective.

In the mobile business, virtually everyone agrees that Apple changed end user expectations about what a handset should do, how it should work, and also cracked or broke the historic stranglehood mobile service providers have had over handset features.

In the developing mobile Internet experience, for example, there already are glimmers of a shift of experience from "Web" pages to applications. For a firm such as Google, dependent on search revenues for nearly all of its revenue, that potentially shifts revenue away from search and towards the mobile application as the way people find things.

To the extent that the mobile application, supplied by the application store, becomes the gateway for use of Web-based applications, power and financial success shift towards the app store and the device, and away from the access provider

So the issue that naturally arises is what to make of Apple's influence on the broader technology industry, which generally has moved to an "open" model, where Apple continues to operate on a "partially open" model, closed in terms of operating systems and hardware, but open--with editorial control--for applications.

As attention in the U.S. and some other markets now is turning to "gatekeeper" functions, the implications are that gatekeepers of many sorts now are arising in the Internet ecosystem. Though government regulators typically look at access providers, application providers are emerging as equally-important gatekeepers, as operating systems and browsers have caused concern in the past.

"The iPad is seen by many in the print business as a way of delivering high-value digital content to customers paying real money," notes U.K. technology observer John Naughton. There is a price: Apple will control the distribution channel and take a slice of every transaction.

The iPhone and iPad are really just gateways to the Internet, but are controlled (a better word than "closed") experiences, not the "open" or unfiltered way PCs have been used to access the Internet and its resources.

To the extent that gatekeepers are an issue, we likely will see new concerns about application and experience gatekeepers; nothing so crude as "access" gatekeeping.

Some think Google is the greatest emerging gatekeeper. Perhaps it is Apple.

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Why Buy a Kindle if You Can Use an iPad?

An app to read e-books from Amazon’s Kindle store on the iPad has arrived in iTunes. If that is the case, why buy a Kindle at all? Price, you might correctly note, but wait a couple of years and that problem goes away.

That suggests a major Kindle price cut has to be coming. Historically, many multi-purpose computing devices have sold better than single-purpose devices, when there is a choice. That's why iPhone sales are cannibalizing iPod sales.

With the arrival of the Kindle app, iPad owners will be able to choose whether to read books from Amazon or from Apple. Using the iPad gives users access to all Kindle inventory, with Apple inventory thrown in, as well as color support and the ability to do lots of other things that require Internet access, ranging from email to Web browsing to messaging.

Waiting in Line for iPads...

Lines of people wrapping around the block at the SoHo Apple Store, waiting, presumably, to buy an iPad.

What will be interesting is to see how sales stack up, and I don't mean volume of sales, but whether people decide they want connectivity all the time, like a smartphone, or can live with Wi-Fi access, as iPod touch users now do.

The difference is that the Wi-Fi-only approach makes the iPad more a media consumption device, while full-time connections might make it something else.

What the "something else" might be, remains to be seen. Nobody seems to think it replaces a smartphone. Beyond that, people seem to be unsure about whether it represents an entirely new product category or "just" a new interface for a netbook or laptop.