Nearly everyone is gushing about Apple's (Nasdaq: AAPL) new iPad. The evolutionary iPad 2, hitting the market just 11 months after the revolutionary iPad, will be huge for Apple -- and a headache for nearly everybody else.
The following five companies have plenty to lose from iPad 2's March 11 arrival:
ZAGG (Nasdaq: ZAGG)
Shares of ZAGG fell 24% yesterday, making it the biggest percentage loser on Apple news. Perhaps after a bit of deep breathing, investors calmed down and pushed the stock back 18% in today's trading.
Apple introduced the Smart Cover, a clever protective wrap that snaps into place magnetically on the iPad 2. It also doubles as a stand, and it's available in 10 different colors.
This is problematic for ZAGG. The company has carved a cozy living out of selling covers, screen protectors, and other accessories for Apple gadgetry. Apple has been pretty bland about its accessories in the past, giving ZAGG and other third-party opportunists a crack at outfitting Apple fans with stylish and functional add-ons. The Smart Cover is both edgy and full-featured. If it's a hit -- and it will be -- expect Apple to add similar pizzazz to future accessories.
Motorola Mobility (NYSE: MMI)
Motorola Mobility's stock took a 4% hit yesterday. Xoom -- the first tablet running Google's (Nasdaq: GOOG) tablet-specific Android 3.0 Honeycomb operating system -- seemed like a legitimate threat to Apple earlier this year. Even after Motorola Mobility revealed that it wouldn't come in at a lower price point than the iPad, its killer spec sheet still turned heads.
Dual cameras became one of Xoom's major selling points: a front-facing camera for videoconferencing, and a rear-facing one that shoots high-def video in 720p. Everyone expected iPad 2 to at least add a front-facing video camera, making the most of Apple's FaceTime videoconferencing platform. But as it turns out, the iPad 2 also has a rear-facing camera shooting in (you guessed it) high-def 720p.
There are still some neat hardware whistles on the Xoom, and software selling points for Honeycomb, but the iPad 2 may be enough to drown them out.
Seagate (Nasdaq: STX)
Hard drive makers gained ground yesterday, even though an iSuppli report warned of a sequential decline in shipments. The shift to tablet and smartphone computing is obviously hurting hard drive companies, since smaller gadgetry leans on flash storage instead of drive makers' traditional magnetic platters.
The arrival of the iPad 2 will force tablet makers to up their game, making their upcoming devices more functional. You hear that, laptops?
In fairness, all of these slim, portable flash-memory-packing devices won't necessarily sound the death knell for hard drives. We'll still need server storage to keep the Internet humming along. Nonetheless, the shift could prove troublesome for hard drive makers and investors alike.
Research In Motion (Nasdaq: RIMM)
Apple's customers expect annual refreshes to the company's iProducts, so rival tablet makers probably didn't expect the iPad 2 to hit the market as early as next week. Now that the U.S. March 11 launch date is official, where does that leave RIM's PlayBook?
The BlackBerry giant is aiming for an entirely different market than Apple's fan base, but it has to hurt to be rolling out this late. Apple has already sold 15 million iPads. Who knows how many iPad 2s it will move on top of that before RIM ships its first tablet?
Cisco (Nasdaq: CSCO)
Rather than go through all of the other tablet makers that are as late to the party as RIM, let me name the networking giant as this list's final loser.
The iPad 2's dual cameras and FaceTime functionality hit Cisco below the belt in two different places. First we have Cisco's line of Flip cameras. Incorporating a camera into the latest generation of iPod touch was a bigger affront to Flip's product line, but it'll be an even harder sell when tablets can also shoot high-def video in a pinch.
There's also Umi Telepresence, enterprise-centric Cisco's first push into consumer videoconferencing. Between FaceTime and the iPad 2's long overdue addition of HDMI video mirroring (with a $39 adapter), Umi seems overpriced and out of touch.
Which of these five companies do you think will be the biggest loser? Can you think of more? Share your thoughts in the comment box below.
