But the bottomline is that the iPad has cannibalized even the sales of laptops.

AMD is not alone in viewing the iPad as disruptive to the traditional laptop business. Earlier this week Intel CEO Paul Otellini told analysts that the iPad will “probably” hurt PC notebook sales. In the long term, though, Otellini believes the iPad will help expand the category of consumer electronics–much like what netbooks did.

But there’s one major difference. So far, all the two major tablets–the iPad and the upcoming Samsung Galaxy Tab and Research In Motion’s PlayBook–don’t use chips from the traditional PC chipmakers.

“Intel is starting to manage expectations better, admitting that iPad would cannibalize PC growth, but it has made the case that it is well positioned in other tablets,” Mark Lipacis, an analyst with Morgan Stanley wrote in a research note. “We remain challenged to find Intel-based non-Apple tablets which can drive meaningful revenues for Intel.”

Since Apple launched the iPad in April, the company has sold more than 3 million devices and has given the category a second lease on life. Other companies such as Dell, Samsung and BlackBerry maker RIM have announced new tablets but the iPad remains the market leader for now. Meanwhile, the halo effect from the iPad has spurred PC sales for Apple. Apple overtook Acer to become the number three PC maker in the U.S. in the last quarter, according to IDC.

“Apple’s influence on the PC market continues to grow, particularly in the U.S., as the company’s iPad has had some negative impact on the mini notebook market,” says Bob O’Donnell, IDC vice president for clients and displays. “But, the halo effect of the device also helped propel Mac sales and moved the company into the number three position in the U.S. market.”

For AMD and Intel, that can’t be good news. Unlike the netbook category, whose rise helped propel sales of chips for these companies, the explosive growth of tablets could help reduce their influence–unless they jump on to the trend.

And that’s exactly what Intel is hoping to do with its MeeGo operating system. MeeGo is a Linux-based operating system for mobile devices that Intel has developed along with Nokia. A key executive departure and news that smartphones running the operating system won’t be available until sometime next year has left Intel and Nokia fighting to stay on course with Meego.

But already a German company WeTab is offering a MeeGo based tablet.

Intel says more tablets based on MeeGo will hit the market next year. Ultimately, tablets will become “additive to the bottom line, and not take away from it,” Otellini told analysts.

But unless some Intel-chip based tablets come to market soon that may be in danger of becoming just wishful thinking.

See Also:

• Samsung Tablet May Cost $400 with Long-Term Contract
• Why 2010 Will Be the Year of the Tablet
• How the Tablet Will Change the World
• Roundup: The First Reviews of Apple’s iPad

Photo: Jon Snyder/Wired.com

Authors: Priya Ganapati

to know more click here