May 27, 2010 8:43 pm

Apple in control of iPad’s Europe launch

 
akechiyo Yamanaka, 19, who has been waiting in line to purchase Apple's iPad since Wednesday, reads a magazine in front of Apple Ginza store in Tokyo©Reuters

Strong demand: rumours of short supply have seen consumers queue for days, as in Tokyo (pictured)

Apple will begin selling its iPad tablet computer in the UK, Germany and seven other countries on Friday , promoting the international debut with the same rumours of tight supply that helped create long lines of buyers in its home US market last month.

Apple has sold more than 1m of the touch-screen devices in the US.

Buyers are unable to buy iPads at many of its own stores and at Best Buy retail outlets.

Apple has said it was overwhelmed by demand, although orders placed with suppliers show it hopes to sell as many as 10m annually.

The company also said that international pre-orders have not used up the stock for any other country.

Analysts believe Apple faced legitimate supply constraints at least in the first days after the iPad went on sale. But they also said the company has a knack for stoking an exaggerated sense of urgency among shoppers.

“The availability from an output standpoint has improved,” said Morgan Stanley analyst Katy Huberty, although she added that US stocks were low because Apple had shifted shipments overseas.

Half of Apple’s iPhone sales in the first year were outside the US and Ms Huberty said that the iPad could be even more popular elsewhere because customers could use more telecom carriers.

She said Apple’s first-year internal sales goal of 10m was realistic.

So far sales have been stronger than initial iPhone sales.

Among the many uncertainties around the iPad’s international launch, however, is what applications will be available on the first day.

While Apple got all the main book publishers to contribute titles to an electronic book store in the US, sources said not all UK houses were following suit.

Secrecy is a key aspect of Apple’s extreme control of the retail and marketing process.

In the UK, which is expected to be the second strongest market for the iPad, the computer will be available in Apple’s shops and for 60 days at PC World and Currys stores, both owned by DSGi. But DSGi has been unable to promote the launch before Friday , or even confirm it, under the terms of its deal.

“It’s all very tightly controlled by Apple,” said one person close to the company. “Apple will announce their partners. They are controlling every aspect of the communications. It’s the Apple way.”

Apple said the DSGi stores would be the key outside UK outlet, while Media Markt, owned by German retail giant Metro, will play the same role in that country and FNAC will get the task in France. The gadget will also be launched on Friday in Australia, Canada, Italy, Japan, Spain and Switzerland.

Picking just a few chains for initial distribution helps Apple with logistics, further propagates the air of scarcity and likely gets Apple better terms from retailers willing to pay in order to generate floor traffic.

The telecommunications carriers offering data plans that will allow buyers to surf the internet from the iPad will not sell the devices in their own stores, Apple said, with the exception of exclusive ally and No 2 carrier Softbank in Japan.

Apple is generally sticking with the same carriers that have supported the iPhone, although it is adding Three in the UK and O2 in Germany. Four of the UK’s five mobile network operators will offer data plans for the iPad, with prices ranging between £25 ($36) and £7.50 per month, depending on the operator and data allowance.

Additional reporting by Maija Palmer in London, Andrew Edgecliffe-Johnson in New York, Bernard Simon in Toronto, Haig Simonian in Zurich, Gerrit Wiesmann in Berlin, and Robin Harding in Tokyo

Copyright The Financial Times Limited 2014. You may share using our article tools.
Please don't cut articles from FT.com and redistribute by email or post to the web.

NEWS BY EMAIL

Sign up for email briefings to stay up to date on topics you are interested in

SHARE THIS QUOTE