The story has been making its way all across the internet, so I figured we should pay some attention to it as well. Morgan Stanley's Katy Huberty issued a proprietary report to clients this morning in which she studies the impact of HP's acquisition of Palm. In the report, she states that if HP were to build a tablet running the webOS, it could capture 15% of the tablet market - a market which, at this point, is totally owned by the iPad
and the Joo Joo.
Also in the report, Huberty has a chart which shows the decline in netbook sales growth per month, year-over-year. The chart shows that year-over-year, the sales growth of netbooks is on a steady decline. In July 2009, netbook sales increased by a staggering 641% compared to the same month a year earlier. This is the kind of idiotic growth that's simply unsustainable.
From July 2009 onwards, the sales growth of netbooks has been declining - note, however, that sales are still growing, only at a more comfortable, less hype-like pace. The explanation for this is pretty simple: back in 2008, the netbook was still a new phenomenon (the first netbook in the sense that we know them, the Asus EeePC 700 series, was launched in late 2007), mostly restricted to geek milieus such as, well myself. As with any new and widely popular product, initial sales growth will be astonishing as the market seeks to saturate itself.
The graph shows that the decline in sales growth for netbook started in Septmeber 2009, after which sales growth rose a little again in anticipation for the holiday season, only to continue its decline afterwards. Year-over-year unit sales growth in April of this year was still 5%, however, meaning that more netbooks were sold this April than during the same month last year.
Huberty's conclusion, therefore, is flawed. She concludes in the report that the launch of the iPad, as well as the anticipated arrival of competing tablets, have caused a dent in netbook sales, starting in Januay when the iPad was unveiled, taking another hit in April when the iPad was launched.
As anyone with basic graph reading skills can see, this is just plain wrong. Not only did the decline in sales growth for netbooks start far ahead of the unveiling of the iPad (five months, to be exact), still more netbooks were sold after the unveiling and launch of the iPad than during the same period last year. On top of that, the decline in and of itself is also perfectly understandable - markets get saturated.
That is not to say the iPad hasn't impacted sales - it most likely has, considering how relatively similar the two devices' intended function sets are. However, to conclude, as Fortune does, that netbooks sales are being "gobbled up" is not supported by this particular dataset. We'll need more data spanning a longer time-period.