Will the iPad hurt PC sales? Chipmaking giant Intel thinks Apple’s tablet will “probably” make some consumers turn away from purchasing PCs. However, CEO Paul Otellini took the tact that the iPad’s waves will make all boats rise. “Apple has done a wonderful job reinventing the category,” he told analysts.
“Consumers will have a limited amount of discretionary income and some will choose to purchase a tablet instead of upgrading an existing PC or purchasing a netbook,” Otellini said.
How the iPad will affect PC sales is “the big question on everyone’s mind,” the Intel chief said. His comments follow a stream of reports that the tablet’s popularity is damaging sales of netbooks and PCs in general. Last month, Best Buy’s CEO announced (then retracted) that sales of netbooks and PCs fell by nearly 50 percent amid demand for the iPad. Morgan Stanley’s Kat Huberty also said “tablet cannibalization” was eating into PC sales. These headlines followed Intel announcing a drop in expected third-quarter revenue, citing “weaker than expected sales of consumer PCs in mature markets.”
Little wonder Otellini wanted to announce the chipmaker instead had record third-quarter revenue of $11.1 billion. Intel still plans to help develop iPad competitors, using Windows, Android or MeeGo. However, with Apple’s expected record-breaking revenue announcement set for Oct. 18, one wonders if that wave Cupertino created will not just lift all boats, but sink competitors.