Apple Inc. may sell 600,000 of the second version of the iPad when it debuts this weekend, extending the device s lead in a crowding market.
The iPad 2 goes on sale on Apple s website at 4 a.m. New York time, then appears in U.S. stores at 5 p.m. Brian Marshall, an analyst at Gleacher & Co. who predicted more than a half- million in unit sales, is one of several who expect the iPad 2 to outpace its predecessor. Apple sold 300,000 of that version in 24 hours.
The iPad line is the fastest-selling technology product in history, measured by revenue, said Tim Bajarin, an analyst at Creative Strategies Inc. In less than three months, it topped $2 billion -- a milestone the iPhone took more than six quarters to reach. The second version has a head start on rivals, which are only now releasing their first models. It s also benefiting from distribution through additional retail outlets.
Apple has such a huge lead, said Bajarin, who has covered the industry for more than 20 years and works as a technology consultant. He projects 500,000 units in two days. Competitors are going to be chasing Apple for many years.
Bajarin -- along with analysts from Rodman & Renshaw LLC and Piper Jaffray & Co. -- also predicts the device will outsell the first iPad, which came out in April. Apple will get a boost from offering a white model for the first time, he said.
More Stores
The iPad 2 will be available at 236 Apple stores, which will close from 3 p.m. to 5 p.m. to prepare for the release, Amy Bessette, a company spokeswoman said yesterday.
Apple s new tablet also will be sold at more than 10,000 stores of AT&T Inc., Verizon Wireless, Wal-Mart Stores Inc., Best Buy Co. and Target Corp., according to Piper Jaffray s Gene Munster.
Last year, Apple had 221 stores and it sold the device through about 1,100 other outlets, according to Munster. Through December, Apple sold a total of 14.8 million iPads, generating $9.6 billion in sales.
On a unit basis, the device isn t the fastest-selling product. According to Guinness World Records, Microsoft Corp. s Kinect game accessory took that prize after selling an average of 133,333 units daily in its first 60 days. Apple s iPhone 4 tallied 120,000, Nintendo Co. s Wii had 85,000, and the first iPad reached 50,000 a day during their debut periods.
Faster Growth
According to the Consumer Electronics Association, tablets make up the fastest-growing consumer-electronics segment. In 2010, with the iPad s introduction, total tablet sales surged to more than 10.3 million units, from 90,000 in 2009. That rate of adoption tops those of game consoles and smartphones, according to the Arlington, Virginia-based trade organization.
Apple also has a price advantage over its competitors, said Ashok Kumar, an analyst for Rodman & Renshaw in San Francisco. The cost is the same as the original version, starting at $499 for a base model with 16 gigabytes of memory. Motorola Mobility Holdings Inc. s Xoom tablet costs $799 for 32 gigabytes -- $70 more than a comparable iPad.
The iPad 2 is essentially the tablet market, Kumar said, predicting the company will sell 35 million units this year. That very well could be conservative.
The device s faster processor speeds up performance and improves graphics quality, and front and rear cameras allow for videoconferencing. It s also 15 percent lighter and 33 percent thinner than the previous model. Customers have access to more than 350,000 applications in Apple s App Store, including more than 65,000 tailored for the iPad.
VCRs, DVDs, Cameras
Since Chief Executive Officer Steve Jobs unveiled the iPad last year, it s become one of Apple s top products. The tablet generated more revenue last quarter than the iPod, the best- selling media player.
The iPad built a following faster than the original video- cassette recorder, DVD player, game console or digital camera, said Colin McGranahan, a retail analyst at Sanford C. Bernstein & Co. in New York.
In addition to appealing to consumers, the iPad has been popular with businesses, including JPMorgan Chase & Co., Wells Fargo & Co. and Archer-Daniels-Midland Co.
This fiscal year, the iPad may bring in revenue of $16.3 billion for Apple, according to Toni Sacconaghi, another analyst at Bernstein. The iPhone didn t reach that level until more than three years after its release.
Competing devices from Motorola and Samsung Electronics Co. are struggling to match Apple s success and price. As new tablets come to the market this year, there could be a bubble of rival devices, Mark Moskowitz, an analyst at JPMorgan, said in a research note. That would create more supply than demand.
The technical and form factor improvements of the iPad 2 stand to make it tougher for the first generation of competitive offerings to play catch-up, Moskowitz said in a research note.
