Apple iPad 2 Launch Helps Inflate Tablet Bubble
Scott Moritz
Scott Moritz
NEW YORK (TheStreet) -- As Apple(AAPL) gears up for the sales launch of its iPad 2 Friday, some analysts hear the strains of a bubble about to burst.
Based on industry production estimates, 81 million tablets are scheduled to be manufactured this year, JPMorgan analyst Mark Moskowitz wrote in a research note Wednesday. That number is nearly twice the size of the 47.9 million tablet sales estimate Moskowitz has for 2011.
 |
Assuming tablet makers recognize they may have over-estimated the opportunity and prudently reduce production plans by 20%, that would still create a surplus of 17.2 million devices -- or a 35.9% oversupply -- of tablets this year, according to Moskowitz.
If true, this will lead to a terrific tablet pileup this year, causing outfits like Apple, Acer, Dell(DELL), HP(HPQ), Motorola(MMI)and Research In Motion(RIMM) to potentially suffer some nasty dents.