According to a new report by Sterne Agee analyst Shaw Wu relayed by Fortune, the production issues that were affecting the iPad 2 supply chain over the past months have “significantly improved”, with shipments approaching 3-4 million units per month as constraints ease on the suppliers’ end. Wu now estimates 6.8 million iPads for the quarter that ends on June 25 up from 5.9 million units, as well as 17 million iPhones and 3.9 million Macs. Wu notes how the release of the white iPhone marks a “continued strong adoption” of the product, also helped by the availability of the iPhone on Verizon in the United States.
The production problems that hurt iPad shipments last quarter have “significantly improved,” writes Wu, “with better yields and higher output due to successful retooling and conversion of more production lines to iPad 2.” This would appear to contradict recent reports of shortages of both components and labor.
The iPad “still has a ways” to go to hit what Wu says is Apple’s goal of 3-4 million units per month by the second half of 2011, but is “getting closer.”
Contradicting reports posted in the past weeks indicated Apple was still facing production issues with the iPad 2 because of the Japan earthquake and tsunami, alongside other problems encountered at Foxconn’s facilities, which led FBR analyst Craig Berger to believe Apple would be unable to meet the internal goal of 40-45 million iPads produced this year. Among the technical issues mentioned by separate reports recently, the iPad 2 shortages were linked to speaker and display production issues related to light leakage problems discovered in some LG screen units shipped last quarter.
According to a new research note by FBR analyst Craig Berger relayed by Business Insider, Apple will be unable to meet the internal goal of 40-45 million iPads produced this year. The analyst called the number “out of reach”, and said low touchscreen supplies, component shortages and production issues at Hon Hai’s Foxconn will limit Apple and affect iPad shipments throughout the second and third calendar quarters of 2011.
For the third quarter, he sees production dropping off to 5.2 million units thanks to component shortages and production problems. He also says the effects of the Japanese earthquake could be felt in Q3. But, Berger says that could change if touchscreen supplies improve.
Ahead of the iPad 2 announcement and release in March, reports suggested the device could be delayed until June due to production issues in Foxconn’s facilities. The alleged delay didn’t happen of course, but it’s no secret Apple struggled to meet demand for the new device as also confirmed by COO Tim Cook at the company’s Q2 2011 earnings call, where he said consumer demand had been “staggering” with the iPad 2 heavily back logged at the end of the quarter. He later went on to call the iPad 2 “the mother of backlogs”, with Apple working as fast as they can to get the device in the hands of consumers. Tim Cook also said the Japan earthquake and tsunami would reduce revenue in Q3 by around $200 million, but assured Apple was on track to avoid production issues and shortages for the next quarters.
Separate reports in the past weeks noted display and speaker production issues affected iPad production in the last quarter. The iPad 2 is available on Apple’s online store, with waiting times of 1-2 weeks in most international stores.
Last month, a report by IHS’ iSuppli claimed the iPad 2 shortages Apple had to face in the quarter (with 4.69 million units sold announced at the Q2 2011 earnings call, well below Wall Street’s analysts’ estimates) were caused by production issues with the IPS display and built-in speaker of the device. Whilst the report didn’t provide additional details on the reasons behind the display manufacturing issues, iSupply wrote “quality concerns” affected Apple’s estimated number of initial iPad 2 shipments. The company mentioned ”lamination issues with one of the touch suppliers”, yet stating that Apple was on track to increase the volume of iPad shipments in the next quarter, as also mentioned by Tim Cook when referring to the iPad 2 as the “mother of all backlogs.”
A new report by Digitimes today claims the production issues with the iPad’s display were caused by light leakage issues in LG’s units, with LG shipping only 3.2 million display units in the quarter.
In other news, Samsung Electronics shipped a total of four million 9.7-inch panels for iPads in the first quarter, outpacing rival LG Display (LGD) as the largest tablet PC panel supplier for Apple, the sources indicated. LGD’s iPad panel shipments reached only 3.2 million units in the first quarter.
LGD was forced to reduce its shipments in the first quarter due to light leakage problem for panels produced at its 6G production lines. The company reportedly has fixed the problem and will resume shipment momentum to Apple in the second quarter, said the sources.
Digitimes does not relate LG’s manufacturing issues with overall iPad shortages in Apple’s Q2, but the report seems to corroborate iSuppli’s previous claims of shipments below estimates due to problems in the iPad production chain.
Amidst all the debates surrounding the implementation of subscriptions for App Store apps (which are based on iTunes payments, and require publishers to give a 30% cut off every transaction to Apple), Apple is still in talks with major publishers to reach a deal before the rumored June 30th deadline, when developers of existing “publishing apps” will be forced to flip the switch on native subscriptions if they want to keeps their magazines and digital newspapers in the Store. We’ve seen Apple is trying to push their effort of building better subscriptions for everyone among the general public, but so far the sheer volume of publishers jumping on board hasn’t played in favor of Apple: a very few of them have agreed to Apple’s terms, but those who did are seemingly happy with their decisions. And according to a new report by the Wall Street Journal, a new deal between Time Inc. (publisher of iPad magazine apps like Fortune, Sports Illustrated, and Time) should move adoption of subscriptions forward as Apple now allows to give away single-magazine issues away for free to existing print subscribers, directly from the iPad app.
Time Inc., the country’s largest magazine publisher, has reached a deal with Apple Inc. to make all its iPad editions free for print subscribers, marking a break in the impasse between publishers and Apple and lending support to Time’s contention that it’s business-as-usual after the ouster of its chief executive.
Starting Monday, subscribers to Sports Illustrated, Time and Fortune magazines will be able to access the iPad editions via the apps, which will be able to authenticate them as subscribers. Time Inc.’s People magazine already had such an arrangement, but readers of most publications have had to pay separately for the iPad version regardless of their subscriber status.
The WSJ also reports Time’s general counsel Edelson has been meeting with Apple’s VP of Internet Services Eddy Cue recently to reach a deal for print subscriber access and subscriptions, and in spite of the lack of subscriptions in Time Inc.’s magazines, sources say negotiations are moving forward as the June deadline approaches. Publishers are still asking Apple to revise its policy on opt-in sharing of personal information (a vital aspect for publishers’ targeted advertising), but as more magazines and newspapers will become available in the next weeks, the quick adoption of subscriptions is looking good for Jobs and Cue.
Following Apple’s Q2 2011 financial results and the number of iPad 2 sales in the quarter lower than expected by Wall Street analysts at 4.6 million units, speculation has arisen as to whether or not Apple had to face shortages due to Japan’s earthquake and tsunami that affected production of key components for the tablet. While Apple COO Tim Cook assured that they’re making as many iPads as they can with no “supply or cost impact in fiscal Q2 in result of the tragedy”, a new report by IHS’ iSuppli sheds some light on the actual production issues that determined the shortage of iPad 2s in the first quarter of 2011.
The report notes how “quality concerns” over LCD screens might have affected Apple’s estimated number of iPads to ship during the quarter, together with “production shortages” with the redesigned speaker that Apple implemented in the second-generation device. iSuppli also mentions “lamination issues with one of the touch suppliers” and “shortfalls” in the end-unit production.
While Apple is now on track to significantly increase its production volume in the second quarter,” according to the Thursday’s iSuppli News Flash, “the company reportedly is still falling substantially short of its target production goal for April.”
As a result, iSupply has lowered its 2011 iPad shipment forecast to 39.7 million from the 43.7 million forecast in February.
At the earnings call, Tim Cook said demand for the iPad 2 was “staggering” and the company was “amazed” with the results. However, he also went on to say they were “heavily backlogged” at the end of the quarter, later calling the iPad 2′s production the “mother of all backlogs” with Apple working as fast they possibly could to get the device in the hands of consumers. Earlier reports of Apple willing to pay more to suppliers to ensure a steady flow of components and executives visiting Japan soon after the tragedy to sign pre-payment deals suggested the company was focused on avoiding possible delays and shortages, although iSuppli hints at LCD and speaker issues as the cause of lower shipments in the first quarter.
A thread on Apple Discussions detailing connectivity issues experienced by some users on the Verizon iPad 2 WiFi + 3G model caught the attention of the Internet today as more than 80 replies were posted on the original thread confirming that the issue occurred when turning on / off the 3G signal and trying to get it to work again. Other users reported tricks like temporarily activating Airplane mode on their iPad 2 to “kill” 3G and restart it didn’t work as a solution to re-enable connectivity on the device.
All Things Digital now reports an official statement from Apple, with the company confirming that they’re “investigating” the issues:
We are aware that a small number of iPad 2 customers have experienced connectivity issues with the Verizon 3G network and we are investigating it,” the company said in a statement to Mobilized. A Verizon representative did not immediately respond to a request for comment.
Apple has been rumored to be wrapping up the release of another iOS update, version 4.3.2, to make it available in the next two weeks. If Apple has confirmed their engineering team is looking into connectivity problems, there is the high chance these issues will be addressed in the aforementioned iOS update, which is going to be focused on bug fixes and performance enhancements for all iOS devices.
A few days ago we reported the FaceTime app on the iPad 2 might have some issues with the cameras “freezing” on the last displayed video call until a user restarts the device. I experienced this problem personally and it’s very annoying, as it forces you to close everything and reboot. Yet the issues with iPad 2 cameras reported by Cult Of Mac (and other users in my Twitter timeline last week, too) certainly are more interesting. Mainly because the screenshots taken to demonstrate the issue are completely crazy.
I compiled some still images from a recording that I made while inside a car wash. I had my iPad 2 in my bag, and I figured that, since I’ve yet to record a video on it, I could just record my trip through the car wash. During the two and a half minutes that I was in there, I noticed that the colors were “glitching-out.” It’s happened three times now.
Apparently the issue hasn’t been fixed in iOS 4.3.1, and it’s unclear whether it’s a software-related problem, a more serious hardware flaw. When I saw the first Twitpics of these crazy iPad 2 shots last week I thought it was an isolated issue happening to a couple of users, now Cult Of Mac says they received dozens of similar reports. I, for one, can say the issue with FaceTime and the cameras freezing is most definitely real, although I can’t confirm on the “color glitching” problem reported above. If you’re experiencing problems with your iPad 2′s cameras, drop a comment below or, even better, open a thread on Apple Discussions.
AppleInsider points to an issue with the FaceTime app on the iPad 2 that happened to me last night: after a video call with a friend, I came back to the app and found that the image on screen was completely frozen. FaceTime was displaying a static image of the front-facing camera when I hung up the call, and starting a new one wasn’t fixing the problem. I tried to quit and re-open the FaceTime app, but the frozen image was still there. So I restarted my device, and FaceTime correctly captured video from the front-facing camera again.
It happens quite frequently,” user “leov36″ wrote of the issue. “Restarting the ipad fixes the problem, BUT, it happens again with in the next two to three times i go to use it.
When I opened up FaceTime the first time, the camera was working fine, but now whenever I open it up, it just shows a still image from when I left,” user “CRK The Man” wrote. “How can I fix it?
It appears that this issue is very common among early iPad 2 adopters, and a user on Apple Discussions also claims a Verizon Store manager told him several demo units displayed the freezing FaceTime image inside the store. It seems that for now the only solution is rebooting the iPad 2, but I don’t think (unlike several users have reported on Apple Discussions) that restoring the device is necessary.
The issue will likely be fixed in the upcoming iOS 4.3.1 upgrade, but if you’re experiencing it right now all you can do is shut down the iPad and restart it.
In an effort to drive more customers to its monthly subscription plans and experiment with the App Store distribution platform, the Wall Street Journal is launching “single-issue” downloads in its official iPad app, Paid Content reports. The option, not available yet in the free iPad app, will allow users to download a day’s WSJ content for $1.99 on their iPad, and according to Dow Jones’ digital head Alisa Bowen the new system will better invite users to subscribe to the full-access digital subscription plan. Single-issue downloads will offer a relatively cheap way to sample content and decide whether or not a full subscription is worth it.
There will be limitations in the single-issue downloads, but the WSJ hasn’t provided additional details. These new downloads won’t affect in any way the current $18 subscription that gives readers complete access to the WSJ website.
Right now, any current WSJ subscriber with a log-in can get full access—to the site and all the apps—and that won’t change. In addition, the WSJ recently began offering a digital bundle offer. Basically, for $3.99 per week, you can get full access to WSJ.com and its suite of digital products (iPad, Android Tablet Edition, iPhone and BlackBerry apps), all of which works out to roughly $17 with tax for a full month.
Bowen told me that she believes readers are more likely to subscribe once they had a taste of the content. But it’s not the first time they’ve tried that approach. For example, WSJ content is available for free to users who log on to Starbucks’ digital network as part of the coffee chain’s free wifi access.
Last week, controversy arose around the New York Times’ subscription plans that will force readers to choose between three different packages for website access, smartphone and tablet apps. Many think the NYT’s plans are too expensive and complex in differentiating between smartphones and tablets; it is unclear at this point whether the WSJ will consider a unified option for iPhone, iPad and Android users or take a similar approach to the NYT by launching different subscriptions across devices. The single-issues downloads are expected to be implemented with a new version of the iPad app, which was last updated in February.