Why the President of Dell's Consumer Business is Unplugged from Reality: Tablets will Hurt the PC (DELL)

"The tablet is still seen as a third device. It's not going to replace the smartphone. So far, it has not shown any opportunity to replace the notebook or the desktop computer," Steve Felice, President, Consumer, Small and Medium Business at Dell DELL told CNBC on Wednesday. Well, that's all well and great, Mr. Felice. But let's look at a beautiful thing called reality. Apple AAPL has sold an astonishing 20 million iPads since its debut last year. Meanwhile, tech behemoths Research in Motion RIMM, Motorola MMI, Hewlett-Packard HPQ, Samsung, Google GOOG and Dell have all raced to get a completive tablet offering to market. HP's consumer PC sales retracted 23% last quarter, and the company reduced guidance. While Dell reported strong overall earnings, its consumer sales fell 7.5%. Microsoft MFST Windows sales fell 4.4%. Media and music distribution is being completely rethought to accommodate users who want their content on the go. According to Jefferies & Co., "More than 70 million tablets like the Apple Inc. iPad will be sold in 2011, a total that will balloon to 246 million in three years." With all of that said, how can Mr. Felice legitimately say that that tablets won't impact consumer PC sales? It's almost embarrassing to ignore the consumer trends that have emerged as technology has developed. Take the laptop as an example. This product has had deep implications for manufacturers around the world as it allowed consumers and business users alike to take computer functionality away from the desk chair. If Dell had said then that laptops wouldn't in some way "replace" the PC, it would surely be a shell of the company it is now. Now, the PRESIDENT of Dell's consumer business is speaking as if Windows 97 is still relevant. The company should get with reality, or its large business/ government sales will be its sole source of revenue. Tablets will (and already have) replaced some PC sales. Some consumers simply don't have time to deal with a PC - and the tablet will again illustrate the speed of consumer tastes.