Why was Apple’s prediction on iPads so wrong?

Apple has announced it is selling far more iPads than it expected and is delaying the worldwide launch by a month.

I am seeing this problem in US too. There are lines in stores (when I went back to buy a third iPad I had to wait in line). The demand is nuts for iPads.

So why did Apple guess its prediction so wrong? Several reasons:

1. They didn’t realize just how many apps would ship on day one and how good the quality of those apps would be.
2. Even the app developers never had their hands on iPads (I talked with several developers, even at “hot” companies like Evernote, while waiting in line, and they had to develop their apps without even seeing an iPad) so the marketplace couldn’t tell them before it shipped just how hot this would be.
3. The focus groups that Apple talked with didn’t hype it up enough with the people studying the groups. This is because they, themselves, didn’t have the apps (the iPad without apps is pretty lame, actually).
4. They didn’t realize how fast skeptics would be convinced. I’ve seen this myself. My son was very skeptical before it came out, saying he didn’t want one. The minute he put his hands on it he started changing his mind and within five minutes of using it said “I was wrong.”

This is one of those dangers that Apple has: predicting demand is really tough when your market really can’t see the complete product before it ships.

On the other hand, this is a very positive sign for Apple. It means that the iPad is moving outside of the “Apple faithful” very quickly, which I have also observed in the stores. The people I met buying iPads a few days later from the opening were quite different than those of us waiting in line.

Apple has a runaway hit. Bummer for those of you waiting for yours.

UPDATE: on the other hand, lots of people are skeptical, including ZDNet.


The Seesmic Squeeze: how a company responds to market changes in Twitter’s ecosystem

Take a pile of carbon and apply enough heat and pressure and you’ll get diamonds. Of course you might just not get it right and will end up with a pile of ash.

If you talk with Loic Le Meur, CEO of Seesmic, he tells a story of feeling squeezed, just like a batch of carbon. Squeezed by the press, like Techcrunch, who said that Le Meur is in denial of the storm brewing over the Twitter ecosystem after Twitter announced it will compete with the client partners it so famously enabled.

Squeezed by Twitter who didn’t give him warning that it would soon compete with him and the other client developers. I’ve heard more than one story lately of meetings with Ev Williams and the Twitter team to show them Twitter clients and gotten nothing but praise in return. A little “hey, you might think about taking your company in another direction” would have been nice.

Even today, one of Twitter’s investors, Chris Sacca, is saying to “stay the course” to developers like Loic Le Meur, even though when I talk with developers they say the whole ecosystem has changed overnight.

Squeezed by even Apple who has famously put new rules in place for app developers and has shipped the iPad, which needs new development, and a new OS SDK, which will need new development. Seesmic is very late in getting its iPhone client done (he showed me how work is progressing on that front and I get now why Seesmic is taking its time there, Loic might really come out brilliantly because his client didn’t ship before Twitter changed directions so now Loic can steer Seesmic into a new, calmer, part of the sea while other client developers like Twitterriffic, Echofon, and TweetDeck will find it more difficult to change directions to avoid the head-on competition with Twitter.

He told me he’s getting notes from friends, investors, competitors, family, and others asking how things are going. Heck, even I am showing up with my camera trying to find out if there’s a deadpool victim here.

One interesting thing I’ve learned about great entrepreneurs: they get up from a sucker punch and jump right back into the fight. Loic didn’t disappoint here, watch the video and you’ll see he has a new version of Seesmic Desktop shipping this week that takes Seesmic in an entirely new direction: a multi-service platform of his own. At minute 25 in the video Loic takes on the concerns laid out in the industry by Techcrunch.

What did Seesmic do with its desktop client platform?

1. Dumped Adobe technology and went with Microsoft Silverlight. Why? “We needed plugins,” Le Meur says, which are needed to build a platform that would enable a new microblogging client platform to be built.

2. Dumped Twitter. If you look at Seesmic Desktop now you can run that without even having Twitter as part of it. So, a developer could use the new client to interact only with Facebook (which is also a plugin). Add the Twitter plugin and you have a Twitter client, but it’s not required.

3. Opened up search to non-Twitter search engines. Now you can do searches on a variety of search partners, including the newly announced TweetUp, which has an interesting way to sell ads and is sharing revenues with partners like Seesmic.

4. Built a skinning platform. Does CocaCola need its own client? Well, now Seesmic can offer that. So far Twitter hasn’t been able to ship a totally skinnable Twitter and Twitter sure won’t be very likely to build a client that serves Facebook, Linked In, and tons of others the way Seesmic’s new desktop is.

5. Built in Ping.fm, which lets users wean themselves off of Twitter. Write one microblog in Seesmic desktop and you can decide to publish it on a bunch of different services, including Twitter.

There are a few other things too that Seesmic has done with its new platform, but it’s clear that Loic has been thinking about how to diversify off of being only Twitter-centric, and this is how I believe all the Twitter client developers must move, or face dramatically lower valuations than they were expecting.

Anyway, put it all together and Seesmic is responding very well to being squeezed.

How about the other companies in Twitter’s ecosystem? We find out later today as we attend the Twitter Chirp conference. You can watch that on Justin.tv, by the way. See you there!