When HP’s Todd Bradley was asked about the future of PCs with the emergence of tablets and how that would affect the sales of PCs, Mr. Executive Vice President announced that, “Tablets are not going to cannibalize notebook sales, but are adjacent to notebooks.”  He revealed that, “Tablets are phenomenal for content consumption, while PCs are great for content creation.”  This idea is also shared by Morgan Stanley’s team of CFAs and PhDs that recently released their 96-page long blue paper on tablets and their impact.

According to Morgan Stanley’s paper, 75 percent of surveyed consumers use PCs for content consumption and sharing purposes such as social networking, listening to music, viewing pictures, and watching videos.  And this usage pattern implies that content consumption will migrate towards tablets and mobile devices as they are optimized for these purposes.  Tablets offer longer battery life, are portable, have high resolution displays, and the content offering for tablets is getting more robust, making these devices ideal for content consumption purposes.  Morgan Stanley data indicates that consumers are still using the traditional PCs for word processing, creating spreadsheets, and photo editing activities, which can be classified as content creation.  Even though users are spending less time on their PCs for playing games, accessing Facebook, reading, and watching videos, PCs still lead the market when it comes to creating files and working.

However, when Apple’s Steve Jobs showcased the iPad 2, the ailing CEO of the company revealed the different uses that an iPad was being put to.  This included the iPad being used for everyday purposes, checking emails, playing games, reading, and using maps in a variety of settings.  According to Apple, the device is increasingly finding usage by students, artists, and designers for purposes that can be called content creation activities. The company highlighted Chicago Public School as an example, which is using iPads for teaching kids.  According to their research, the iPad is engaging kids more when it is used for teaching alphabets, colors, math, and science.

At the iPad 2 launch, Apple also revealed two new apps, which are called the iMovie and Garage Band.  Now defying HP’s stand, these apps are not meant for content consumption, but are used for creating music and making movies.  Hence, with these apps, the iPad is now not only used for content consumption, but is seen as a tool for active creation of content.  With that, I don’t see myself or any other member of gap intelligence crunching out big excel files on an iPad or a similar tablet, but I definitely see myself perhaps using a tablet for editing my photos and writing my blog.  Hence, while tablet usage is still well below traditional PC usage for content creation, tablets may be used for creating light content, and this will likely go up in the near future.

While many in the industry would still like to believe that tablets will only be used for content consumption, I think that with this new step by Apple, tablets will soon be competing not just against netbooks, but also low-end basic notebooks.