Meet the iPad: The Netbook's Mortal Enemy

Forget what Apple (Nasdaq: AAPL  ) says. The iPad is neither cute nor fun. It's a cold-blooded killer of PC market share.

According to data from researchers at Gartner and IDC, the iPad demolished Acer's U.S. share of the PC market in the fourth quarter, as consumers began to increasingly regard tablets as viable alternatives to lightweight netbooks.

"These devices do not replace primary PCs, but they are viewed as good enough devices for these who want to have a second and third connected device for content consumption usage," said Gartner analyst Mikako Kitagawa in a press release. "Mini-notebook shipments were hit the most by the success of media tablets."

Here's a closer look at Gartner's roundup of the victims, which included leading PC makers Dell (Nasdaq: DELL  ) and Hewlett-Packard (NYSE: HPQ  ) :

Prelminary U.S. PC vendor unit shipment estimates

Company

Q4 2010 Shipments

Q4 2010Market Share (%)

Q4 2009 Shipments

Q4 2009  Market Share (%)

Year-Over-Year Growth (%)

HP 17,581,525 18.8 17,786,986 19.6 -1.2
Acer Group 11,852,617 12.7 12,075,091 13.3 -1.8
Dell 10,801,225 11.6 10,395,288 11.5 3.9
Lenovo 9,481,565 10.1 7,809,357 8.6 21.4
Toshiba 5,346,700 5.7 4,768,306 5.3 12.1
Others 38,416,677 41.1 37,816,171 41.7 1.6
Total 93,480,310 100.0 90,651,199 100.0 3.1

Data includes desk-based PCs, mobile PCs, and mini-notebooks, but not media tablets such as the iPad.

Source: Gartner (January 2011).

The story gets more interesting if you include the iPad. Wall Street predicts that Apple sold 6 million tablets during the holiday quarter. Add that to Gartner's Mac sales projection, and you've suddenly got a PC powerhouse accounting for 31.3% of the market.

Unfair math, you say? Go tell Microsoft (Nasdaq: MSFT  ) CEO Steve Ballmer. He's the one who called the iPad a PC at last June's D8 tech industry conference.

The lines are blurring between what is and isn't a PC -- which surely favors Apple. Is there really anyone left who doubts that the company will blow away estimates when it reports earnings next week? Please let us know where you stand by voting in the poll below, then leave a comment to explain your thinking.

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Fool contributor Tim Beyers is a member of the Rule Breakers stock-picking team. He had stock and options positions in Apple at the time of publication. Check out Tim's portfolio holdings and Foolish writings, or connect with him on Twitter as @milehighfool. You can also get his insights delivered directly to your RSS reader. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool owns shares of Apple and Microsoft. The Fool is also on Twitter as @TheMotleyFool. Its disclosure policy would appreciate a little sunshine over here. Thanks.


Read/Post Comments (6) | Recommend This Article (5)

Comments from our Foolish Readers

Help us keep this a respectfully Foolish area! This is a place for our readers to discuss, debate, and learn more about the Foolish investing topic you read about above. Help us keep it clean and safe. If you believe a comment is abusive or otherwise violates our Fool's Rules, please report it via the Report this Comment Report this Comment icon found on every comment.

  • Report this Comment On January 13, 2011, at 9:30 PM, wjcoffman wrote:

    Apple's on a tear. The next drop in their stock price will be if/when the next market drop occurs or if, God forbid, something happens to Steve Jobs. Who needs Apple's overpriced toys? Apparently everyone?!

    Long AAPL

  • Report this Comment On January 13, 2011, at 9:47 PM, AndyHowells wrote:

    iPad is more convenient than notebook. For entertainment, I'll choose tablet. Actually, i have an ipad and collected free apps, eBooks, wallpaper to it. I'm glad to share part of my lists with you.

    ifunia ipad column.

  • Report this Comment On January 14, 2011, at 12:23 AM, ConstableOdo wrote:

    The iHater are certain that a $250 Windows netbook is far more useful than an iPad because the netbook runs a full OS, has a keyboard and supports Adobe Flash. Apparently, there are some consumers that can live without those advantages. I think we'll see how many more when the fully-equipped 3G iPad 2 is running on both AT&T and Verizon's network. I think there are plenty more consumers that will be happy to give up Windows Desktop OS to use the basically trouble-free iOS. The iPad won't likely kill off most of the netbooks, but should take a nice 30% market share from them. Or even better, to be used by consumers that didn't have an interest in computer devices before.

  • Report this Comment On January 14, 2011, at 12:58 AM, MichaelKnows wrote:

    the ipad will never replace a netbook.. anyone who thinks so doesn't travel enough.

  • Report this Comment On January 14, 2011, at 9:53 AM, LosFlores wrote:

    I think what we are seeing is the result of a few things:

    1) Appliance type desires for systems.

    People don't actually WANT a do-all device. It means they have to understand how it works in order to actually do what they WANT to do. netbooks still require some understanding of how to do things in the OS, because they have to be open ended enough to allow a lot of different types of interfaces/connections. Appliances (even ones that do multiple functions) focus on doing 2 or 3 things really well, and thats pretty much it. You don't buy an 'industrial strength' vacuum cleaner with every attachment known to man if you have an 800 sq ft efficiency apartment to keep clean.

    2) luxury vs utility.

    Apple is very much a luxury brand. Everything about everything they make screams 'I'm expensive and high quality. Love me at your peril'

    And lets face it. no one NEEDS an iPad. they just don't. If you took it away from someone one, they would go through a whiny withdrawal faze, and be just fine afterward.

    3) needs vs wants

    You may NEED a netbook in order to easily keep working on your projects while you travel (they do travel much better than a full sized notebook.)

    but you WANT an iPAD to entertain yourself. It's better at entertainment than a netbook. It's DESIGNED to be better at being a high end toy, that also has some basic utility to it, so those of us that care about technology from that aspect, can justify the top dollar price of the gear.

    For example: Photographers & Apple love each other. I can't tell you how many photographers I have seen loving on their iPads for the awesome display it has. Followed by months of trying to force the iPad to use an external memory card, so they can dump more pictures to it. or to tweak it so they can wirelessly send images to it for previews while they shoot, or, god forbid, use the ipad to touch up and sort pictures!

    There are much easier, much cheaper, existing solutions for netbooks, that use all the same software they use on their main machines, yet they will waste tons of time trying to force their iPad into a role it isn't designed for :)

    This, IMHO, is where the iPad hate comes from. Trying to make the iPad into something it isn't, and shouldn't be: Useful.

  • Report this Comment On January 14, 2011, at 10:01 AM, gageaa wrote:

    I love my iPhone and seriously considered an iPad, but chose a netbook instead for these reasons: 1. The netbook stands up by itself (great for putting it on a tray table). 2. When folded close, the netbook is a bit smaller (great for my wife's purse). 3. The netbook has a 250GB hard drive (much greater capacity for movies/music). 4. The netbook was much cheaper.

    I, however, own no netbook manufacturer stocks. I'm long on Apple, though!

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