3 Reasons You'll Buy the New iPad That Everybody Hates
There's been a lot of negative press popping up about the new iPad that Apple (NAS: AAPL) introduced over the weekend.
- The tablet heats up far more than the original iPad and the iPad 2.
- The 4G models that connect to either Verizon (NYS: VZ) or AT&T (NYS: T) are data hogs. This is a problem because both wireless carriers no longer offer unlimited data plans, and the new iPad can quickly go through a month's bandwidth allotment.
- To take advantage of the superior Retina display, updated apps are now larger. In other words, they suck up more of the tablet's storage capacity for the sake of eye candy.
Apple sold 3 million of these puppies over the weekend, before these issues came to light. Sales should slow at this point, but not necessarily because of the unwelcome press. Try to order a new iPad online and you will see that all models are warning of wait times of two to three weeks before shipping. There's also a good chance that your local Apple Store may be out of stock despite the perpetual flow of incoming shipments.
Any kind of shortage would seem dreadful at a time when naysayers are brewing the perfect storm of negativity, but you're smarter than that. Let's go over the reasons that you and nearly everybody else still wants to get his or her hands on the new iPad -- and it has nothing to do with warming you up on one of the last chilly evenings of the season.
1. Tablet sales are booming
In reinitiating coverage on Best Buy (NYS: BBY) this week, Goldman Sachs analyst Matthew Fassler projected that tablet sales at the consumer electronics retailer would climb 30% this year. The move contrasts with a 7% slide in PC sales.
Let's get this straight: Whenever someone says "tablet sales," they're really saying "iPad sales." Outside of Kindle Fire's millions, most of the other tablets on the market are fringe players. The 15.4 million iPad 2 units that Apple sold during the holiday quarter is probably more than all non-iPad tablets sold for all of last year.
A tablet isn't for everybody. It's not powerful enough. However, a lot of the people who used to buy desktops and laptops when all they really wanted to do was surf the Web and stay in touch now realize that tablets are the better way to go. That's not going to change.
Even Microsoft (NAS: MSFT) -- the company that has the most to lose as tablets replace PCs -- is making sure that its upcoming Windows 8 plays nice with touchscreen tablets.
2. The new iPad is better than the iPad 2
Despite all of the knocks, Apple's third generation of tablets is noticeably superior to last year's model.
Isn't this the reason that every iPhone and iPad outsells the previous incarnation? Apple is able to cram more features into its annual upgrades without bumping the selling price higher. That's not going to change.
The new iPad heats up? The battery and processor are just that strong. The 4G model is a data hog? That's another way of saying that it's a speed demon in cyberspace. That's a good thing. Apps are larger because of the Retina display? You're welcome.
3. Tablet owners love Wi-Fi
There's another reason that the reports of 4G LTE iPads bleeding through their monthly data allotments isn't all that big a deal. Folks favor the cheaper Wi-Fi tablets over the cellular units.
Industry analyst Chetan Sharma claims that nine out of every 10 tablets sold last year were Wi-Fi only. Most iPad buyers aren't interested in paying $130 more for a cellular model and then slapping a data contract through Verizon or AT&T on top of that.
The gap may narrow with the new iPad since the 4G LTE is both faster and can now be legally used as a mobile hotspot. However, the vast majority of the new iPad owners and prospective buyers will be relying on the ever-growing number of Wi-Fi homes and hotspots to fuel their tablet experiences.
Born to run
The next trillion-dollar revolution will be in mobile gadgetry, but the best investing play isn't necessarily Apple. If you want to cash in on the upcoming trend, a new report will get you up to speed. Yes, it's as free as this article, but it won't last forever, so check it out now.
At the time this article was published The Motley Fool owns shares of Apple, Best Buy, and Microsoft.Motley Fool newsletter serviceshave recommended buying shares of Microsoft and Apple.Motley Fool newsletter serviceshave recommended creating a bull call spread position in Apple.Motley Fool newsletter serviceshave recommended creating a bull call spread position in Microsoft. Try any of our Foolish newsletter servicesfree for 30 days. We Fools may not all hold the same opinions, but we all believe thatconsidering a diverse range of insightsmakes us better investors. The Motley Fool has adisclosure policy.Longtime Fool contributor Rick Munarriz calls them as he sees them. He does not own shares in any of the stocks in this story. Rick is also part of theRule Breakersnewsletter research team, seeking out tomorrow's ultimate growth stocks a day early.
Copyright © 1995 - 2012 The Motley Fool, LLC. All rights reserved. The Motley Fool has a disclosure policy.