Rumor: The Billion Dollar Tablet

Source: Piper Jaffray

Source: Piper Jaffray

Piper Jaffray analyst Gene Munster believes the rumored Apple tablet will be much more than a lifestyle product for the presbyopic generation. Instead, Munster expects as many as two million tablets could be sold in 2010, generating an estimated 1.2 billion in revenue.

Via Apple 2.0, Munster’s latest research also predicts a 2010 release. “Last week we spoke with an Asian component supplier that has received orders from Apple for a touch-screen device to be fulfilled by late CY09.” While this supports earlier reports, the most recent suggested timeframe is 2009.

As for the tablet itself, as the mock-up suggests, Munster apparently believes a giant iPod touch is in the offing. The tablet will be designed for media consumption, web surfing, and text tasks, like simple email. Pricing is expected to be in the $500 to $700 range, considerably less than previous estimates of $800. The tablet will likely have a 3G data plan, possibly subsidized, carriers being AT&T or Verizon. All this makes Munster bullish on the tablet, “While at first glance this may appear to address a niche market, we believe the addressable market is larger than that of the Apple TV, of which Apple sold about 1.2m in its first year.”

And this is where we stop the prediction train and get off. That last bit about 1.2 million Apple TVs being sold is, like much of this research note, speculation. Sales numbers for the Apple TV have never been released (not a good sign). The only official commentary on sales came during the first quarter conference call this year when Tim Cook stated that “unit sales were up over three times versus the year-ago quarter.” Three times what has never been established.

However, a comparison to the Apple TV is relevant to the tablet as a cautionary tale. Sadly, by refusing to add a DVD player or streaming options from services like Netflix and Hulu, the Apple TV languishes as nothing more than extension of the iTunes Store in the living room. If the Apple tablet turns out to be a giant iPod touch — hopefully better looking that that horrid mock-up — it risks being nothing more than extension of the App Store. That’s not as bad as the Apple TV, but the tablet could do better.

One rumor we have not heard anything about is whether the tablet will allow a Bluetooth keyboard. If so, an entire category of functionality would be added, from emails of more than a few sentences to papers and reports pages long. In your hand it’s a tablet, in a stand it’s a word processor. While there could be a risk of cannibalizing MacBook sales, it seems small. Assuming the tablet runs iPhone OS, the current limitations of the operating system would ensure the safety of MacBook sales.

The question whether the Apple tablet will truly be an alternative to the netbook or a giant iPod touch will likely be answered soon. One can only hope the reply can be typed.

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