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Even though a single iPad hasn’t actually been shipped, that won’t stop the questions over the success of initial orders from being asked. Considering how Apple (s aapl) has positioned the iPad in the product lineup, on par with the Mac, iPod, and iPhone, Steve Jobs better have a press-release answer ready.
On Friday, Philip Elmer-DeWitt at Apple 2.0 started following people following the numbers, though whether those numbers are real or imaginary is yet to be determined. The data thus far derived has come from InvestorVillage, an Internet forum for “self-directed investors.”
By using orders numbers from an admittedly small number of purchasers, and accounting for purchases of other products at the Apple Store, the initial estimate was 51,000 in the first two hours, 74,000 after four and a half hours, and 91,000 in six hours. According to Apple 2.0, by the end of Friday the estimated number of iPad pre-orders was approximately 120,000. That’s the good news, assuming it’s true.
Apple 2.0 also passed along metrics for 110 iPads that are what you’d expect, Wi-Fi over 3G by two to one, the cheapest iPad at $499 being very popular. Somewhat surprisingly, the most expensive model, 64GB/3G at $829, was also popular but, hey, these are self-directed investors spending their hard-earned dividends that we’re talking about.
Of course, there’s another group of investors waiting for news on iPad orders. Investors in AAPL saw their fortunes rise on Friday with the stock price reaching a new high at $227, the company briefly overtaking Wal-Mart in valuation at $206 billion. Whether AAPL goes higher on Monday will likely come down to how many iPad orders there were over the weekend, but how many equals success?
Looking back at iPhone launches, a million iPads ordered would definitely be a success, probably more than all the Slate PCs with Windows sold since 2002. Don’t expect that to happen. Both the iPhone 3G and iPhone 3GS were immediately available in multiple countries. While the iPad will be available in other countries in late April, the first weekend of the month will be U.S. only, so perhaps the original iPhone would be a better comparison. Certainly, if the iPad does outsell the original iPhone, that will be the spin, but what if it doesn’t?
Everyone who wanted to order an iPad could have ordered one Friday. There were no lines at the online Apple Store. Even assuming the number crunchers at InvestorVillage got it right on Friday, it seems unlikely to me anything like 120,000 orders will be placed on successive days. For the sake of argument, let’s assume the number ordered is halved on successive days, 210,000 total over three days. 210,000 iPads doesn’t look very good compared to the iPhone launch, does it? The only thing worse would be if Apple doesn’t release any numbers.
In an interview with the New York Times last year, Jobs remarked on Amazon’s (s amzn) silence over Kindle sales, saying, “usually, if they sell a lot of something, you want to tell everybody.” That’s exactly why we’ve never heard about Apple TV sales, and it’s what will be the real metric for whether iPad orders were a success over the weekend. If there is silence from Cupertino, expect investors to react with wailing and selling of AAPL. More importantly for consumers, there could be an immediate drop in the price for the iPad, similar to what happened with the original iPhone shortly after launch.
I think that’s the kind of failure we can all appreciate.
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