IPad Sales

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iPad is hot on eBay, but for how long?

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Last week I did the unthinkable. I sold my iPad on eBay.

Was it a case of buyer’s remorse? There was some of that, sure. But more than anything it was due to Apple’s returns and exchanges policy, which gives buyers two weeks (instead of the more typical 30 days) to change their mind. And if it’s been opened, you have to pay a fairly standard 10 percent restocking fee, which for the iPad can range from $60 to $83, depending on what model you got.

To be fair, I knew about these limitations upfront. So, being out of the 14-day policy and not wanting to trek all the way out to an Apple store to sweet-talk a manager into breaking the rules to let me pay Apple $60 to trade up for a more expensive model (which was, and still is out of stock at the San Francisco store), I went with eBay instead.

In the spirit of spring cleaning, I had used the auction service the week prior to sell my aging iPhone 3G. It had a two-inch crack running up he back, as well as several scuffs–all things I had made mention and included photos of in the auction description. Amazingly, I sold it for just $30 less than I paid for it brand new, two years prior, so my hopes were high for breaking even, and possibly even making a small profit.

Sure enough, that turned out to be the case. In less than eight hours, my one-day auction had jumped from $100 to $500, and it closed at $600–which is the amount I had paid for the iPad before sales tax. I may have lost the $50 I had paid for California sales tax, but I would have had to pay Apple $10 more if I had gone through the standard return process (for which I was ineligible).

What really surprised me though, was how much interest I was getting from international buyers, folks who currently cannot get their hands on an iPad in their own country–at least until the end of the month. I got messages from people in Spain, Russia, the U.K., and Australia, all of whom said they would bid if I could just do international shipping. And this was just for a one-day auction; I imagine I’d get quite a few more if it had run longer.

In fact, a great number of eBay sellers are offering international shipping on iPads. According to numbersgathered by The New York Times this past weekend, some 65 percent of iPads sold on the auction site are ending up in the hands of buyers outside of the U.S. That’s no small number, especially considering the Times says many of those are paying a premium, which in some cases could end up being a third the cost of the machine.

The hang-ups

So what’s involved in selling something internationally? Paperwork for one. Sellers need to fill out customs forms that state the value of the item, which if its over $400 (which all iPad models are), requires a special sticker that can be a red flag for customs officials to give it a thorough inspection.

In England, for example, having your item searched by customs can result in value added tax (VAT) and a clearance fees. I know of this extra expense first hand after living in London for a year. I had received a DVD set of a TV show that had cost $45 back in the states. My parents had sent it to me as a gift (which is how it was marked on the customs form). But since its compared value to the same product in Great Britain was more than 40 pounds, I had to pay about $30 in VAT and handling charges just to pick it up from the post office. This was regardless of the fact that the DVDs were in a separate region.

Is it worth it for buyers to go through the hassle then? Apple would seemingly prefer that you didn’t, based on what happened to blogger Protocol Snow. His efforts to bring fellow Web forum-goers a way to purchase the device, and cover the cost of international shipping and customs were shut down by his local Apple store after he had purchased just five units over the course of a few days.

He ended up being banned from ever purchasing an iPad from Apple’s retail store. On top of this, it was costing him around $130 to $150 extra to cover the sales tax, shipping, insurance, and fees to PayPal. If you were selling through eBay, there would be a charge for the listing, and any reserve fees as well.

Regional differences

In terms of the price difference, buying off eBay can save international buyers some money, depending on where they are and how much they ended up paying. iPad prices across most of Europe are higher than they are in the U.S., which isn’t unusual, but in most cases they’re hardly enough to outweigh the expenses of shipping and possible customs duties that have to be paid.

As my CNET UK colleague Rory Reid wrote last week, the price difference between the U.K. and the U.S. version of the iPad can range anywhere from $37 to $44, depending on what model you get. But that’s not the biggest mark-up. German buyers pay $1,044 for the top model, which costs around $909 including taxes back in the states.

For these markets where the mark-up is more than $100 (like in Germany), it makes some sense to go the eBay route, whereas those in the other countries will have less of a reason to want to import once the device is for sale there.

Japan is one region where eBay imports may continue to flourish after its official iPad launch later this month. PC World reports that Japan’s 3G version of the iPad will be locked to carrier Softbank Mobile. This means buyers of the 3G model there will only be able to use it with that carrier’s service. By comparison, iPad 3G models in other countries are unlocked and allow users to use the device with compatible micro-SIM cards.

Is it even worth it?

Whether the hoops of international commerce are worth jumping through is a question for both the buyer and the seller. If you’re an eBay seller who is used to selling things internationally, now’s the time to do so. As for whether that’s still going to be the case when the iPad is released internationally, it’s too early to tell. Just keep in mind what happened to the man who got banned from purchasing any more iPads from Apple’s retail store after buying just five.

As for buyers, the reasons for or against an international purchase depend on where you are. If you’re in Germany, it could make financial sense to import one if you get a deal, but less so if you end up paying retail or higher, then the shipping and import duties on top of that.

What may be the biggest reason for international buyers to snatch one up now, is of course, that they are early adopters. While logic would dictate that this is a silly practice, New York Times’ Damon Darlin points out that the amount of impatience this group has ends up leaving late adopters with a better, and often less expensive product. The clear reason to buy for these folks is the same as it is with any other gadget. Having a crack at it before anyone else can be, for some (myself included), an intoxicating prospect–even at a mark-up.

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iPad Sales – May 2010 Update

If nothing else, one million sales would appear to establish the iPad as a hot product. We may have to wait until Apple’s incoming quarterly results in July to see how the big iPad sales plays out for the company’s bottom line, if that is your question.

About the iPad sales, in spite of earlier doubts by some iPad critics, Apple has recently disclosed that Apple iPad has sold-out more than one million units, after being launched in the US only a month ago. This makes the iPad more popular now than the iPhone, isn’t it? The Apple company sold 300,000 of the Wi-Fi-only iPads in its first day of availability in the US, including pre-orders.

“One million iPads in 28 days – that’s less than half of the 74 days it took to achieve this milestone with iPhone,” articulated Apple CEO Steve Jobs.
“Demand continues to exceed supply and we’re working hard to get this magical product into the hands of even more customers,” Jobs added.

Due to the high demand, Apple disclosed last month it was pushing back the UK launch date of the iPad. The device will be made available for pre-order on May 10, with iPads to be released at the end of the month.

The original iPhone may be a good barometer for the iPad’s winner, though it’s worth noting that succeeding versions such as the iPhone 3G and the iPhone 3GS each hit the same milestone in their first weekend. But the iPad, even more so than the iPhone, is a device in an unproven, entirely novel category, which makes the accomplishment all the more impressive. Plus, the iPad sales bring with it sales of additional products: iPad users have already downloaded more than 12 million applications and more than 1.5 million e-books from the iBookstore.

And the number of iPad-specific apps continues to rise, with Apple’s latest figure topping 5,000. Watch out for more updates.

iPad-related Blogs

Many estimates are floating around the early sales of iPad. Compared with iPhone, iPhones estimated number sold to date is 42 million units. People line up outside the Apple Store to get the latest iPhone model.

If all that anecdotal evidence proves true for the iPad, then the product will be a success. Of course, sales figures are important in the long run, but quibbling over tens of thousands of units is not how well Apple’s still-unreleased iPad is selling, how well it will sell, and whether it’ll make more of a dent in the market than the iPhone’s debut. Unnamed sources said that hundreds of thousads of iPads have sold since pre-orders began and the iPad’s three-month sales will outdo the iPhone. Others say their is only a 28 percent chance of the iPad beating the iPhone to one million units sold.

There are a few points why this predicted iPad sales may not happen:

The iPad is simply not the iPhone

Apples and oranges argument: iPhone requires a two-year service agreement with AT&T and fits in your pocket. An iPad doesn’t require any monthly service and doesn’t need to leave the house if you don’t want it to.

By all means, compare the Droid and the iPhone, or the Droid and the Nexus One, but measuring the iPhone against the iPad is like comparing sales of Sony laptops and Playstation 3s.

2010 is not 2007: even if the iPad was a comparable product to the iPhone, which it isn’t, comparisons between product launches that are three years apart shouldn’t be taken too seriously. Markets grow. That’s kind of the whole point of this capitalism thing upon which companies like Apple are founded.

More about this at: PCWorld.com