Tablet Cannibalization

NPD reported US retail notebook unit sales declined 4% Y/Y in August, a first decline. The first week of September shows a similar 4% Y/Y drop. Best Buy’s CEO Brian Dunn remarked the iPad cannibalized notebook PC sales by as much as 50%.

What’s going on? Tablet cannibalization. But in a particular way. Here’s John Gruber on Daring Fireball:

There’s been no sign that Mac laptop sales have slowed. We only have one quarter of results for the iPad era, but Mac sales were up 33 percent year-over-year. If it’s true that “laptop” sales overall are slowing, it’s coming entirely at the expense of Apple’s competitors. My theory is that it’s simply about price points. Apple’s MacBooks start at $999. The iPad isn’t competing against MacBooks — it’s competing against $500-900 computers.

I remember the slide Steve Jobs put up when he unveiled the iPad. Right between the smartphone and the notebook PC was where he pegged the iPad, as a netbook competitor. And it seems that’s exactly what’s happening.