It took a year for most of Apple's competitors to try and come close to matching the original iPad; and if analysts are correct; the iPad 2 may have made their efforts pointless.
At an event yesterday in San Francisco, Apple's chief executive officer Steve Jobs introduced the iPad 2 to a worldwide audience. The upgraded iPad, which is 33 percent thinner, has a faster processor and comes with FaceTime, was almost overshadowed by the appearance of the charismatic Apple CEO himself. Earlier reports had suggested Jobs' health had taken a turn for the worse; but on Tuesday he came out looking like his usual self.
Analysts saw this as one of the best signs of the day for Apple. We were pleasantly surprised by Steve's presence and actually thought he looked better than his last public appearance. We believe his message was loud and clear: 'this is my company and I am not planning on going anywhere anytime soon,' said Brian Marshall, analyst for Gleacher & Company, in a note.
The appearance of Jobs could have an impact on the company's stock. As it stands, Apple's stock closed Wednesday at $352.12, and it opened Thursday at $357. Marshall, who maintains a 'buy' rating on Apple, has a price target of $400.
Merrill Lynch's Scott Craig, said in a note that if anything, investors will at least find the appearance of Jobs reassuring, even if it doesn't boost the stock by itself. More than Jobs' appearance, Craig and other analysts were simply impressed by the iPad 2, which they say is a significant upgrade over the original.
Heading into the event, we had no intention of upgrading our first generation iPads, but after testing the new device, we may have changed our minds. The technological improvements the Apple design team made to the iPad 2 in just approximately 12 months is nothing short of phenomenal, Marshall said.
Of the company's improvements to the iPad 2, analysts were impressed by its lighter weight and faster processing speeds. A number of analysts said the improvements, while not obvious as they are internal, will mean bad news for the numerous iPad competitors trying to get a share of the market.
This is a sad day for the crowd of competitors still struggling to home in on the first iPad's price and performance. We continue to see Apple grabbing 75-85 percent of the tablet market in 2011, Oppenheimer analyst Yair Reiner said in a note.
Another advantage Apple will have over many of its competitors is cost. At the entry price of $499, the iPad is a lot cheaper than the Motorola Xoom for example, which is $800. It all comes down to one simple fact according to JP Morgan analyst Mark Moskowitz.
In our view, what is suitably impressive with today's iPad 2 launch is the arrival of a second-generation iPad just as the competition is rolling out or prototyping their first-generation tablets, Moskowitz said in a note.
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