Apple (AAPL): Gingerly, iPad Into the Crowd

I was a skeptic when Apple (AAPL) introduced the iPad in the spring of 2010. It was immediately clear that this would be a hot-selling item, but tablet computers were not new and had never been more than a niche product.

So I wondered what, exactly, most people would do with the new gadget. I thought there was a pretty good chance those sleek new machines would end up gathering dust like so many old boom boxes, unable to match the power of fully equipped computers or the convenience of ever-more-capable smart phones.

I am not going to say, “I hate to say I told you so…” First of all, I have enough chutzpah to write an opinion column, and you can rest assured that despite their denials, opinion columnists love to say “I told you so.” It’s called attribution bias. When we’re right, it proves how smart we are. When we’re wrong, it proves that the world has gone crazy. (Remember this principle the next time you hear someone predict what the stock market will do in the next six months.)

The second and major reason I am not going to say “I told you so” is that the world has gone crazy over the iPad. Some 55 million devices were sold through the end of 2011, according to Time. It seems entirely possible that Apple will sell that many again in 2012 – bringing the total well over 100 million devices by the end of this year.

They can’t all be gathering dust in our closets. We don’t have enough closet space.

My wife owns one of those iPads. She got it not long after I wrote my column questioning what to do with it. My wife happens to be the executive in charge of marketing at my firm. The main reason for buying the device, or so we told ourselves, was that it would let her familiarize herself with the hardware platform and the various applications for it, so we would understand how to use tablets in our business.

As it turned out, the iPad was very good for playing various Scrabble-type games. My wife is a word-game barracuda. She’s got around five games going simultaneously pretty much all the time, and she has a fleet of machines – two laptops, a smartphone and her iPad – to help her keep up.

Lately I have started borrowing her iPad. I was working at our home in New York recently when a storm knocked out our cable company’s internet service. The iPad’s 3G internet service on AT&T’s network allowed me to log back on to my office computer and resume my work. The connection was slower, and it was not easy to work without my accustomed keyboard, but I was able to stay productive during a three-hour outage that otherwise would have forced me offline.

More often, I use the iPad as a substitute for my latest defunct Kindle e-reader. I have a Kindle subscription to The Wall Street Journal, which is convenient because I travel frequently and would get little use from a daily newspaper delivery. I like to read The Journal while I spend my customary daily hour on the elliptical machine in an endless battle against the bodily effects of travel and age.

I like technology, but I usually refrain from change just for the sake of change. If something works for me, I tend to stay with it. So when the iPad came out, I saw no reason to stop using my Kindle, which worked.

Except that the Kindle stopped working. And so did another, and another. I’m not a heavy or heavy-handed user, but my devices kept breaking. First, the selector button on the large-screen Kindle DX literally broke in half. This is the button that acts like a joystick, allowing the user to move the cursor and select items off the menu. For a long time I tried just squeezing the fractured halves together, as I was in no hurry to inject glue into my out-of-warranty machine, but eventually I gave up and moved to another device.

That one developed a crack near the USB port into which the charger is plugged. I became an expert at jiggling the charger cord and balancing the apparatus ever-so-carefully, but that got tiresome and eventually stopped working, too.

The next Kindle, which another family member had had for some time but never used, just died. It simply refused to wake up one day, like a body that had reached the end of its biological time clock. There are steps one should take in that situation. I took them without results. Finally I administered the last rites and contemplated getting yet another Kindle.

I can still get the “Kindle keyboard,” as the older-fashioned machines are now known, or I could get the newer Kindle Fire – which is a tablet modeled very much along the lines of the iPad, but with less software flexibility. It’s just a question of whose ecosystem I prefer to join, Apple’s or Amazon’s. As a heavy Apple user in the rest of my computing life, I am not in a big hurry to make my life more complicated while still ending up with the same class of device.

So I am experimenting with the Kindle app on my wife’s iPad. I can get my Journal, and it’s easier to read on the tablet’s bigger, brighter, higher-contrast color screen. I find it is not a problem to turn pages with my finger, even when I am exercising. I do not have Amazon’s free wireless connection anymore, but I have a cellular data plan for the iPad already, and most days I connect to the internet over my household wi-fi network anyway.

The transition is not without cost. I particularly liked the Kindle’s ability to save a Journal article in a “clippings” file with just a simple command. I used the clippings file to store stories that might be the nucleus of a future commentary column. The iPad app for the Kindle does not support clippings. It allows user-selected highlights to be stored, but I haven’t got the hang yet of highlighting and storing things while I pump away on the elliptical.

But the bottom line is that, even as I type this column on my laptop’s QWERTY keyboard (like the one on the Royal 440 manual typewriter on which I learned touch-typing more than 40 years ago), I have to recognize that keyboards are going away. They are vanishing from smartphones, as Blackberry maker RIM is discovering to its corporate sorrow. They are vanished from tablets, and the day is probably coming when most computers will incorporate touch screens and voice recognition, with vestigial keyboards that will eventually wither away.

Maybe I was right all along, and 100 million iPad buyers are wrong. It doesn’t matter. Since we can’t fit all those iPads in our closets, we’re just going to have to use them. I might as well get used to it.

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About Larry M. Elkin 564 Articles

Affiliation: Palisades Hudson Financial Group

Larry M. Elkin, CPA, CFP®, has provided personal financial and tax counseling to a sophisticated client base since 1986. After six years with Arthur Andersen, where he was a senior manager for personal financial planning and family wealth planning, he founded his own firm in Hastings on Hudson, New York in 1992. That firm grew steadily and became the Palisades Hudson organization, which moved to Scarsdale, New York in 2002. The firm expanded to Fort Lauderdale, Florida, in 2005, and to Atlanta, Georgia, in 2008.

Larry received his B.A. in journalism from the University of Montana in 1978, and his M.B.A. in accounting from New York University in 1986. Larry was a reporter and editor for The Associated Press from 1978 to 1986. He covered government, business and legal affairs for the wire service, with assignments in Helena, Montana; Albany, New York; Washington, D.C.; and New York City’s federal courts in Brooklyn and Manhattan.

Larry established the organization’s investment advisory business, which now manages more than $800 million, in 1997. As president of Palisades Hudson, Larry maintains individual professional relationships with many of the firm’s clients, who reside in more than 25 states from Maine to California as well as in several foreign countries. He is the author of Financial Self-Defense for Unmarried Couples (Currency Doubleday, 1995), which was the first comprehensive financial planning guide for unmarried couples. He also is the editor and publisher of Sentinel, a quarterly newsletter on personal financial planning.

Larry has written many Sentinel articles, including several that anticipated future events. In “The Economic Case Against Tobacco Stocks” (February 1995), he forecast that litigation losses would eventually undermine cigarette manufacturers’ financial position. He concluded in “Is This the Beginning Of The End?” (May 1998) that there was a better-than-even chance that estate taxes would be repealed by 2010, three years before Congress enacted legislation to repeal the tax in 2010. In “IRS Takes A Shot At Split-Dollar Life” (June 1996), Larry predicted that the IRS would be able to treat split dollar arrangements as below-market loans, which came to pass with new rules issued by the Service in 2001 and 2002.

More recently, Larry has addressed the causes and consequences of the “Panic of 2008″ in his Sentinel articles. In “Have We Learned Our Lending Lesson At Last” (October 2007) and “Mortgage Lending Lessons Remain Unlearned” (October 2008), Larry questioned whether or not America has learned any lessons from the savings and loan crisis of the 1980s. In addition, he offered some practical changes that should have been made to amend the situation. In “Take Advantage Of The Panic Of 2008” (January 2009), Larry offered ways to capitalize on the wealth of opportunity that the panic presented.

Larry served as president of the Estate Planning Council of New York City, Inc., in 2005-2006. In 2009 the Council presented Larry with its first-ever Lifetime Achievement Award, citing his service to the organization and “his tireless efforts in promoting our industry by word and by personal example as a consummate estate planning professional.” He is regularly interviewed by national and regional publications, and has made nearly 100 radio and television appearances.

Visit: Palisades Hudson

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