How Many iPads Need To Be Sold To Make It A Viable Platform For Content?

When Apple announced their new iPad last week, many said it was a big deal for content owners as it now gives them another platform to try and monetize their content on. But what I didn't see anyone talking about is how many iPads Apple needs to sell before the platform has a big enough install base to make a difference to content owners?

For developers that plan to use the same app for the iPhone and iPad, the number of iPads sold does not really matter. But what about all of the content owners who are going to write new apps specifically for the iPad and charge for them? How many iPads need to be in the market before they have a chance at actually making any money? This is an expensive device that consumers will have to be willing to drop between $500-$1000 on. This isn't the cost of a Kindle. And while there are plenty of Apple fanboys who will run out to get an iPad as soon as they can, anyone who thinks this device will have the reach the iPhone or iPod did is crazy.

So just how many need to be sold to be successful? This isn't a trick question, I'm just really interested to hear what other people think in terms of the number of units that need to be sold to make it an important device to content owners. So far, I've only seen one published prediction on the number of sales from Thomas Weisel who projects 4.1M iPads will be sold this year. Think that can happen? Is it enough? Would love to hear your comments on it.

Comments

[Ray]

Apple TV was a failure due to lack of demand, and it had a similar price point/margin structure. That would suggest the number of units must be more than what Apple TV did.

[Mike]

Another recent iPad sales projection:

"Apple will likely sell 2 million iPads in FY 2010, with another 6 million coming in 2011, says Needham & Co. analyst Charlie Wolf..."

http://www.ipodnn.com/articles/10/02/03/to.come.at.expense.of.ipod.touch/

[Rod O'Neill]

4,236,902

[padmedamo]

Peel back your onion and there are some really interesting questions:

What will the adoption rate be? We wont see sales restricted artificially by sole-provider agreements with MNOs as with the iPhone but many providers of fixed and radio broadband networks I can see bundling these 3G devices. Mobile, especially, could be a big engine but how big?

How much video content (volume of assets) will folk consume given that its larger form factor but has reduced mobility? I'd guess more content per terminal overall.

Personally I don't see significant technical or commercial hurdles in offering content to these devices in a form people want. Whilst there will be some cannibalisation of consumption on other terminal types the advent of 3G/wi-fi 4th screen will surely have an overall net benefit.

[Steve Lerner]

I don't think the iPad is primarily a video device...

[tbd]

"consumers will have to be willing to drop between $500 to $1,000 on [an iPad] ... this isn't the cost of a Kindle"

Well, I guess some folks will continue to buy a Kindle DX for $489 instead of an entry level iPad for $499? After all, they can save ten dollars... as long as they aren't interested in the App store, iTunes, GPS, multimedia, a color screen, email, browsing the internet, etc, etc, etc. (Or perhaps any estimate of iPad sales should begin with the assumption that other ereader sales drop off a cliff and/or slash prices?)

In reality the sales estimates don't matter... app developers are busy building apps for the iPad right now (even before a single unit has been shipped) because Apple has a history of delivering the critical mass. And because the app store is being built out, consumers will have increased demand for the iPad. It is a self-fulfilling prophecy that benefits Apple for the time being.

[lq2323]

I think this has the potential to blow up live P2P streaming, and there are a whole bunch of startups actively tackling this issue. One of the best technologies is Dyyno - completely free to use for individuals. Been using it with my family and friends and am very impressed.

[cheap ds r4]

It's an interesting point, and you're right that it has been under-examined.Apple's own playbook invented with iPod/iTunes and perfected with iPhone/App Store dictates tight integration between device, service, and content provision/purchase/management.

[dssll]

As the ipad develops over the next couple of years we will see lots of great uses that no one thought of and will become a staple item such as a cell phone or pc

[fanboy]

Seems that Apple bashing was a fun way to go...but look at the stats now and what does that say in 20/20 hindsight?

[Dan Rayburn]

@fanboy: What is says is that Apple has only sold 2M iPad in the U.S. - that's nothing to be excited about. Low numbers.

[trykksaker]

I think Apple always try to control things too much. So I won't support them with buying an iPad, that's for sure.