Apple (AAPL) routinely releases new products with insufficient inventory to keep up with demand. This happened when the iPhone 4 debuted on the Verizon Wireless network last month. Phones available via the cellular company's website ran out in a day. And when the first iPad was released in March 2010, supplies were also too low for demand.
Rumors are already circulating that the supplies of the new iPad 2 -- set to be released on March 2, according to many media reports -- will be well below anticipated market demand as well. Does Apple simply produce too few units of a new product, or is the company plagued by supply-chain-management issues? This debate seems to come up with each new product launch.
Apple Insider reports that "Production issues with new thin display could limit Apple's initial iPad 2 supply." The problem may be due to manufacturing or parts for the screen on the thinner tablet. The report also warned that supply chains from Asia could face problems as they ramp up production.
Apple may run into trouble that it didn't have to worry about when the first iPad was released: Consumers now have plenty of tablet computer alternatives if they don't want to wait for the iPad 2. Motorola (MMI) recently began selling its Xoom tablet. Samsung's Galaxy has been out for a while already. Lenovo is expected to release its tablet this month. And most other large computer makers plan to launch their own tablets in the first half of this year.
Apple's iPad 2 inventory problems -- if they really exist -- may cost the company sales this time because the market is now full of competitors.
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