Earlier today Apple reported a sharp increase in iPad sales for the holiday quarter, a stark contrast with the declining trends for Windows PCs and also Apple Macs.
On a conference call with analysts following the results, Apple CEO Tim Cook was asked about the trends, and he made it clear that he sees the Windows market as far more vulnerable to the rise of tablets than the Mac market. He also reiterated that he believes tablets can ultimately become a bigger market than traditional PCs.
Here’s our quick transcript of his comments on the topic.
I see cannibalization as a huge opportunity for us. Our base philosophy is to never fear cannibalization. If we do, somebody else will just cannibalize it. We never fear it. We know that iPhone has cannibalized some iPod business. That doesn’t worry us that it’s done that. We know that iPad will cannibalize the Mac. That doesn’t worry us. On iPad in particular, we have the mother of all opportunities here, because the Windows market is much, much larger than the Mac market is, and I think it is clear that it’s already cannibalizing some, and I think there’s a tremendous amount more opportunity there. I’ve said for three years now that I believe the tablet market would be larger than the PC market at some point, and I still believe that. You can see by the growth in tablets and the pressure on PCs that those lines are beginning to converge.
The other thing for us — maybe not for others, but for us — is if somebody buys an iPad mini or an iPad, and it’s their first Apple product, we have great experience through the years of knowing that when somebody buys their first Apple product, a percentage of these people end up buying another type of Apple product. If you remember what we had termed the halo effect for some time with the iPod with the Mac, we’re very confident that will happen and we’re seeing evidence of that with the iPad, as well. I see cannibalization as a huge opportunity.
Microsoft reports its quarterly earnings Thursday afternoon, providing the first detailed glimpse of how the Windows 8 launch is affecting the Redmond company’s business. Check back tomorrow for those results.