The Apple iPad 2, which launched last month, is in hot demand -- so hot, in fact, that Best Buy is reportedly restricting sales of the tablet computer due to a supply shortage, according to The Los Angeles Times.
Best Buy, declining to comment directly on the report, would only say that it "continues to receive iPad 2 inventory from Apple on a regular basis," according to Paula Baldwin, a Best Buy spokeswoman, in a statement.
"As we've said previously, we are fulfilling customer reservations first. We are responding to customer demand with product as it is available, and replenishing inventory on a weekly basis. Best Buy enjoys a great partnership with Apple, and we're delighted by customer response to iPad 2."Rhoda Alexander, an analyst with market research firm IHS iSuppli, said it comes as little surprise that demand for the iPad 2 has outstripped supply ever since it was introduced. But there was an expectation that as Apple had resolved "the huge supply issues" the company faced with the first generation iPad, the supply of the iPad 2 would go more smoothly, she told WalletPop.
(One production challenge Apple faced with the original iPad was its new touch screen technology, which had not been mass produced at the tablet size, she said.)
Although Apple has resolved the touch screen issue, "There is a tremendous demand for this product, which is exacerbated by the fact that Apple doesn't have a real competitor" in the tablet space, Alexander said.
And that's just how Apple likes it. "While others have been scrambling to copy the first generation iPad, we're launching iPad 2, which moves the bar far ahead of the competition and will likely cause them to go back to the drawing boards yet again," said Steve Jobs, Apple's chief executive officer, in a March press release on the launch of the iPad 2.
The tablet computer features a new design that is 33% thinner and up to 15% lighter than the original iPad, as well as a faster operating system and other new features, according to Apple.
Introduction to Value Investing
Are you the next Warren Buffett?View Course »