Apple, the iPad and the ‘mutually reinforcing eco-sphere’

New technology has meant that consumers are engaging with media in ways that George Jetson would be proud of. Of course, given the feverish enthusiasm for the iPad, there’s already quite a bit of interesting data about it and while the consumers love it, publishers are also rightly excited about the revenue—and creative—possibilities offered by the new medium. So who’s buying two of Apple’s most popular devices, the iPad and the iPhone? Nielsen surveyed more than 64,000 mobile subscribers in the US to find out. Not surprisingly, iPhone and especially iPad users are trending younger or that iPad and iPhone customers report higher incomes. About 15 percent of iPad users are more than 56 years old compared to 33 percent of all mobile subscribers. And, in news sure to further warm the cockles of publishers aiming at the higher-end, the real shift is in affluent 25 to 36 year-olds.

“About 20 percent of wireless subscribers report earning more than US$100,000, but almost 40 percent of iPad owners fall into that category. Over time, we believe those over 56 age segment could represent a significant growth opportunity for Apple. While these baby boomers are not known as ‘early adopters,’ they do adopt, and we should not underestimate the appeal of Apple’s products as easily and intuitively usable devices for consuming content and internet data.”

As for the apparent cannibalising of the iPhone. Fughedaboudit.

Twenty-five percent of likely smartphone upgraders who have not yet owned an iPhone or iPad, indicate that they would purchase an Apple iPhone as their next smartphone. But when we asked iPad owners who do not have an iPhone this same question, this number more than doubled to 51 percent. Clearly, exposure to Apple’s iOS creates a very positive pre-disposition to purchasing an iPhone. We see the same effect when comparing current iPhone owners, of whom an industry-leading 85 percent indicate that they would purchase another iPhone as their next smartphone. And a whopping 91 percent of likely smartphone upgraders who already own both an iPhone and iPad want an iPhone next. By creating a whole universe of devices and form factors around iOS – all with the easy-to-use interface design Apple is known for — Apple has created a mutually-reinforcing ecosphere that attracts new customers, and convinces them of the virtues of Apple. Being able to share the same applications they purchased on all their other devices free of charge, leads consumers to add more devices from the same universe – and effectively retains them as upgrade customers. Customers have also the added benefit of being able to share the same applications they purchased for one iOS device (iPad, iPhone, iPod) on all their other devices free of charge.

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