Beancounters at JP Morgan have noticed that tablet makers are pulling back on their plans to build the keyboardless netbooks.
A new investor report from JP Morgan said that tablet makers have reduced their build plans after receiving an “early dose of reality” following few sales.
Mark Moskowitz said that tablet build plans have declined by roughly 10 percent since early March because non-Apple tablet hopefuls have adjusted to the weak showing so far.
He said that the trend was an “early dose of reality” and that the market has yet to see a high-volume tablet competitor to the iPad.
Moskowitz has been sceptical about tablets and for the last couple of months has been warning that the whole thing was a bubble waiting to burst.
Basically the theory is that Tablets are an Apple thing at the moment. All Apple needs to do to keep its sales up is to replace the model with a new one. However rivals have to come up with something better for less. At the moment they have been shoving out Apple clones which are more expensive.
At the end of the day only an Apple fanboy would buy a keyboardless netbook, and that is only because some style guru has told them that it is cool.
Fortunately other companies are starting to see that and the reduction in production volumes has prevented a tablet bubble bursting, JP Morgan said.
J.P. Morgan projects 2011 build activity for the tablet market to come in at 63 million after a discount of 14 percent. It is only a 2 million drop.
Moskowitz said that the tablet market is still new. It stands to become just big enough to create a ripple effect in the broader tech food chain” in 2011.
Moskowitz said there will be “limited upward pressure” in build activity occurring throughout the summer. The only place to see increases will be Apple.
Apple admitted it was experiencing the “mother of all backlogs” with the iPad 2 and this caused Moskowitz, and research firms to lower their shipment estimates for the year.