By Troy Wolverton
San Jose Mercury News (MCT)
SAN JOSE, Calif. — Apple on Monday reported out-of-this-world sales for its iPad, but complaints from some users and regulators threaten to bring the gadget and the company back down to earth.
The Cupertino, Calif., company announced it sold 1 million iPads in the 28 days since the gadget hit the market. The announcement came just three days after Apple began sales of versions that can access the Internet over 3G networks.
But even as Apple celebrated, complaints were trickling in about the device and one of the company's business decisions related to it.
Federal regulators are "days away" from launching an antitrust inquiry focusing on the company, the New York Post reported Monday. The probe would scrutinize Apple's recent decision to bar developers from using third-party, cross-platform tools — most notably from Adobe — to create applications for the iPad and iPhone.
Meanwhile, users of the new 3G-enabled iPads have been complaining about problems watching video. ABC television's application reportedly won't stream videos over the cell-phone network. While users can watch video from Netflix and YouTube while connected to 3G, the resolution is low.
Despite Apple's early success with the iPad, "there are still glitches to be worked out," said Susan Kevorkian, an analyst at technology research firm IDC.
But Apple was focusing on the positive. In a statement, company CEO Steve Jobs noted that the iPad reached the 1 million sales figure in less than half the time it took the iPhone, Apple's last breakout hit. And iPad users have already downloaded 12 million applications from the company's App Store and 1.5 million electronic books from Apple's brand new digital book store, the company said.
The number of applications in the App Store now exceeds 200,000, up from 185,000 about a month ago. Of those, 5,000 are iPad-specific applications, up from 3,500 a month ago.
Apple has built on the success of the iPhone and its sister device, the iPod touch, said Van Baker, an analyst with Gartner, a technology research firm. It has sold 85 million of those gadgets to date, so many people already know how to use the iPad, which runs the same operating system.
But both Baker and Kevorkian cautioned that the iPad's early success doesn't mean it will be a long-term hit. It's too early to know if mainstream users will take to the device as much as early adopters have, they said.
The video complaints could impact sales, said Kevorkian. Watching video is one of the things users are going to expect to do with the iPad. And one reason consumers might pay $130 extra for a 3G-capable iPad and $20 or more per month to get a wireless data connection is to watch Web video wherever they are.
"If the quality of the video experience doesn't justify the hardware and service premium, it will diminish demand for the (3G iPad) and cast a pall on the iPad itself," said Kevorkian.
Apple and ABC did not respond to requests for comment about the complaints. But "Business Insider" reported that ABC has already submitted an updated version of the application that would stream video over 3G. Complaints about low-resolution video may not go away, however, because Apple asks developers to create low-resolution versions of their video streams for periods of network congestion.
A federal inquiry also could affect the company and the iPad, even if regulators end up not pressing charges. The inquiry reflects the dissatisfaction of some developers, who have complained about restrictions Apple has placed on them and its application store, such as requiring each iPhone and iPad app to go through an approval process. Apple also has barred large classes of programs, including pornographic ones.
The cross-platform tools Apple has banned make it easier for developers to create applications that will run on several different devices, including not just iPhones and iPads, but Research in Motion's Blackberries and gadgets based on Google's Android software. Jobs, in an open letter last month, argued that such tools are bad for Apple and its users because they yield applications that aren't optimized for Apple's devices and may delay the incorporation of new features.
The reaction to the new policy has been mixed, noted Baker. However, he thinks few developers will stop creating programs for the iPhone and iPad because of the rules.
But Baker argues that if Apple wants to continue its early success, it needs to make clear to mainstream consumers why they need one.
"It's too big to fit in a pocket and there's no keyboard," he said. "The long-term viability of the iPad hinges on (explaining), 'What the heck is this thing?'"
(c) 2010, San Jose Mercury News (San Jose, Calif.).
Visit MercuryNews.com, the World Wide Web site of the Mercury News, at http://www.mercurynews.com.
Distributed by McClatchy-Tribune Information Services.