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Best Buy: iPad cutting into laptop sales

In an interview with The Wall Street Journal, Best Buy CEO Brian Dunn says that the iPad has cut into sales of laptops by as much as 50 percent.

Update at 3:55 p.m. PDT: Best Buy issued a statement Friday afternoon saying that the rate at which CEO Brian Dunn said the iPad is cannibalizing notebook sales was "grossly exaggerated." You can read more details about Best Buy's latest statement in our story here.

Has the iPad affected consumer demand for Netbooks and notebooks? According to comments by Best Buy's chief executive, Apple's popular tablet is chopping away at laptop sales.

Is the iPad cannibalizing laptop sales?
Is the iPad cutting into laptop sales? Apple

Best Buy CEO Brian Dunn told The Wall Street Journal on Tuesday that internal estimates showed the iPad had cannibalized sales from laptop PCs by as much as 50 percent.

Best Buy reported solid second-quarter earnings on Tuesday, thanks in part to strong iPad sales. But the company also said it lost market share for the quarter due to limited inventory for the iPad.

The retail chain started carrying Apple's tablet as the device went on sale in the U.S. in early April. But Best Buy quickly ran out of inventory since it stocked the iPad in only around half of its nationwide stores. The company announced this week that the tablet would be available on September 26 in all its retail outlets.

The comments by Dunn echo findings from other sources that notebook and Netbook demand is slowing because of the iPad.

A column in today's Fortune Magazine points to a new report from Morgan Stanley analyst Katy Huberty saying that "tablet cannibalization," mostly by the iPad, is at least partially to blame for the downturn in notebook sales over the past eight or nine months. Huberty's latest report follows a similar one issued in May in which she forecast that tablets would prove to be a big threat to Netbooks.

Fortune quoted Huberty's conclusion that "we expect tablets to continue to pressure PCs as more vendors launch products (e.g., Dell Streak and Samsung Tab) and Apple expands its iPad distribution."

Other analysts have also been eyeing the impact on the laptop market from tablets. In early July, Barclays Capital issued a report saying that Wintel (Windows and Intel) laptops would take a hit because of the growth of the iPad and rival tablets. A June report from DisplaySearch found that the iPad was already grabbing market share from Netbooks and that momentum was shifting from Netbooks to tablets.

Demand for the iPad has prompted several analysts to up their sales forecasts for the device. In July, ABI Research said it expected Apple to ship around 11 million iPads by the end of the year, while iSuppli predicted that 12.9 million iPads would ship this year, a huge jump from its April forecast of 7.1 million units.

Of course, if the iPad is cannibalizing laptop sales, the news isn't exactly disappointing to Apple. Chief Operating Officer Tim Cook expressed his sentiment in July when the company announced third-quarter earnings.

"Our guts tell us that this market is very big," Cook said. "If it turns out that iPad cannibalizes PCs, that's fantastic for us because there is a lot of PCs to cannibalize."