Friday, February 25, 2011

Honeycomb Arrives - What Happens Next?

Today is the day – the first Honeycomb tablet officially hits the market today, arriving at Verizon stores and Best Buys across the United States. And on the 2nd we will finally hear from Apple about their new iteration of the iPad. The year of the tablet is officially underway and that means there will soon be more tablets than we know what to do with crowding shelf space at your local electronics store. What role will Android play in the new market and how will the platform develop in 2011? Right now we are still guessing, but there are quite a few possibilities.

Full Android Functionality

For those that wanted a full scale PC experience on a tablet computer, the early Android releases like the Galaxy Tab were a little disappointing. Samsung’s first foray into the tablet market was impressive, but it was pared down quite a bit due to the use of Android 2.2, an OS designed for mobile phones.

With Honeycomb finally here, we will likely start to see new apps and possibly even new tablets that can do exciting things. It will still be a bit of time though before the apps roll in as the final Honeycomb SDK was just released on Tuesday. But, with new tablets coming from the likes of LG and Toshiba, plus Motorola throwing quite a bit of marketing weight into their first slate, Android is getting a strong push in 2011.

The Enterprise

An area we should keep a close eye is the enterprise. Companies are clamoring right now to adopt and integrate tablet PCs into their technology plans. But, thus far only the iPad has made an impact in the enterprise community, mostly because there were so few competitors in 2010. Even though Apple claims 80% of Fortune 500 companies are exploring enterprise use of the iPad, I imagine many will take a closer look at Honeycomb tablets as a potential alternative in 2011.

The iPad is not built for enterprise use, and while Apple has produced a handful of features and is expanding support for enterprise on the platform, the open nature of Android is friendlier for IT departments that must contend with support tickets and content control on a mobile scale. Third party companies are already arriving with solutions for Android like push app installation, remote support and rebooting, remote content control, and lost or stolen device detection.

And while BlackBerry Playbook will surely be a factor in the enterprise discussion this year, until it is released, there is no way to know if it will be the device to fill the gaping hole in enterprise mobility or if Honeycomb can make headway in that market.

What Happens Next?

Everyone wants to know what happens next – will Apple slide in market share to Android as it did in the smart phone market? Or will Apple’s commanding lead be bolstered by the iPad 2, likely arriving sometime between April and June? It is impossible to know for sure, but one thing is for certain – the arrival of Honeycomb is going to have a big impact on the tablet market and we will all be watching very closely.

Tuesday, February 22, 2011

The Importance of Display Size in a Successful Tablet

A lot of people argue right now about what the perfect tablet looks like. Should it have this feature or that feature? Does it need Android or Windows or iOS? Can anyone but Apple but profitable? There are a lot of little quirks in the tablet market right now that are drawing attention from analysts, but one of the biggest is probably display size.

Can a successful tablet hit the market with a display size of less than 10”? Steve Jobs doesn’t think so, and yet we have news that Apple may be preparing a new product that is essentially a larger iPod Touch, checking in at 5” instead of the 3.5” that it sits at now. And that brings up even more questions. Not only does display size matter, but how small is too small for a tablet to be a tablet anymore? When does it become a media player or gaming device?

The Profit Margin Issue

Right now, one of the major issues for most manufacturers is that Apple has a pretty big portion of the component market cornered. With all that cash sitting around, the company can afford to make moves like they did in January to shore up $3.9 billion in components. And Apple’s estimated share of the display component market is growing larger constantly as they prepare to expand their iPad offerings.

So, it drives up the costs for other companies to build their own 10” screens and when they launch, like the Xoom will next week, the cost is much higher than many would like (the Xoom will sell for $799 without subsidies). Other devices, however, have launched at smaller sizes and have kept cost down. The Galaxy Tab and Dell Streak 7 are both 7” tablets that sell for less than $500 with subsidies while sporting decent technical specs. And while sales are brisk, they are nowhere near in line with Apple’s.

Some say it is because of Apple’s dominating lead, but others point out that a tablet of only 7” starts to look an awful lot like an oversized media player. Typing on the screen and performing daily tasks gets a bit tougher, though not impossible at that size. I don’t think there is degradation in usability, but many people will look at a small device and compare it to the iPad their friend or neighbor has and wonder, why.

What’s the Perfect Size?

There is no perfect size for a tablet screen. Just like some users prefer a netbook screen of only 10” to a 26” monitor on their desk, others will prefer a 7” tablet they can place in their pocket to a 10” screen that requires a bag to carry.

What I’m really interested in right now is what consumers are willing to purchase. How will manufacturers balance price and function to effectively take a larger portion of the market away from Apple? In 2011 we will see a number of new 7 inch tablets along with many new 10 inch models. Assuredly, the 10” tablets will continue to sell better, especially because Apple will keep their iPad at 10” only.

However, with new options opening up in oversized media players and low cost devices, the market is still far from set, and through it all, display size will likely play a major role in consumer interest. 

Saturday, February 19, 2011

What Should a Tablet Really Cost?

I remember early 2010 before the iPad turned into something more than a longstanding rumor. A lot of people were interested to see what Apple could do to jumpstart a tablet PC industry that to date had only drawn interest from a handful of tech enthusiasts. Sleek design, intuitive features and mass market appeal went a long way, but what blew away a lot of people was the $499 price point.

Of course, there are more expensive iPads. The top end model with 64GB of storage and a 3G antenna costs $829, on par with the projected sale price of the new Motorola Xoom, but if you ask someone how much an iPad costs, most would say “$500”.

What about the New Guys?

With that in mind, can new devices compete with Apple when their starting price points are so much higher? A lot of the excitement surrounding the Xoom was tempered when we found out it would ship at $799 with a WiFi only model available for $600. The Galaxy Tab only gets under that magic $500 price point with a contract through a mobile carrier.

And it’s not as if Apple takes a hit on profits. I believe Apple likely makes the same amount of profit on their devices, regardless of a $500 price point, as Motorola, Samsung, RIM, HP and LG are likely to make with their new tablets. The difference is in the economics of scale. Apple produces significantly more devices when they launch a new product – they have a worldwide brand they can mobilize to sell those products. And now that Apple has taken such a commanding lead in the early tablet market, they can afford to keep their price points low going forward.

The cost of components are such that, unless a manufacturer plans well in advance, shoring up stockpiles of key components (especially those screen materials), they cannot afford to compete on certain levels. Apple’s moves in January to invest $3.9 billion in long term contracts for certain components show what a company with so much cash and an existing market so large can afford to do in shoring up its competitive advantage.

Remaining Profitable

The cost of components is always shifting and so too will profit margins for these companies. I’m hopeful that pricing will not harm companies that aim for innovation in the tablet market. Companies like Motorola and Samsung need to make a profit to stay in business. They cannot afford to cut their margins too thin just to compete with lower priced devices.

And as consumers, we need to remain supportive of higher priced devices with advanced technologies, especially if we ever want their prices to drop. Because unless they develop a stronger following, these other companies will never have the leverage needed to make the same investments as Apple.

How much should a tablet cost? I feel that functionality dictates a lot of the cost. An entertainment focused device like the iPad or Galaxy Tab should cost what a reasonable consumer can afford to pay - $500 seems to be the magic number. But, larger, more powerful tablets can and should be able to sell for slightly higher price points. What that number ends up being remains to be seen, but as long as consumer interest is there, hopefully it will remain low enough to be affordable. And for those companies that can afford it, WiFi only models and smaller screen sizes will be effective ways to provide a reduced cost lineup for entry level tablet users.z 

Tuesday, February 15, 2011

Mass Market or Niche Specific - What a Tablet Needs to Succeed

I’ve said it before and I’ll say it again – 2011 is going to be an interesting year. No one really knows where the tablet market is likely to take us and as a result, a lot of people are trying to guess. Just the other day, NDP Group threw out one of the biggest numbers I’ve seen yet – an estimate of more than 242 million tablets by 2015. Do I think it’s possible? Absolutely. Do we know for sure that it will happen? Not quite. And yet, part of the fun right now is trying to determine exactly where this tsunami of new technology will take us.

Will Apple dominate for years to come as they did in the portable music player niche? Or will then become one of many high profile players in the market as they did with their iPhone? Will Motorola make a strong debut at the end of the month despite a $799 price point on the Xoom? Or will then struggle to get a foothold against a less expensive, more ubiquitous device in the Apple iPad?

Right now, a lot of analysts are worried about pinpointing who can compete directly with the iPad. Maybe there isn’t a direct iPad competitor, but do we really need one anyways? The iPad fulfils a niche need. Despite its incredible sales numbers in 2010, the device cannot replace a desktop or laptop computer for heavy users. In fact, like many Apple products, the iPad is designed to provide the creature comforts of computing in a sleek, well-constructed frame. It is attractive, it is easy, and it has a LOT of Apps and media.

Other devices do not yet have these features, but that may be okay because in a market that is currently hurdling toward the future, the next big question should probably be “who can deliver the best device in each niche?” not who can provide another mass market device.  

Companies thrive and customers win when the focus is taken away from trying to please the most possible customers instead of playing to strengths and developing a device that does specific things very well. And while devices like the Xoom and TouchPad look incredibly attractive, their success hinges largely on the ability of retailers and the manufacturer to market toward a tech-savvy niche of users who want more power in their devices.

How to Establish a Niche in a Growing Market

I don’t think no one stands a chance as a mass market manufacturer. There will surely be at least two or three very strong devices in the next two years that rise to the top of the field for Android and Windows tablet computing. But, as the tablet market moves forward, I think we will also see a strong shift in focus toward creating niche devices that serve more specific needs.

Even Apple has done this in the past with their Mac OS as Windows took and held a huge lead in the home operating system market. If you cannot be the biggest fish in your pond, find a smaller pond. Apple did that with schools and creative professionals.

And right now, I’m as excited to see what manufacturers do with medical devices and enterprise integration on tablets as I am to see what the next mass market entertainment-focused tablet can pull off. Convertible tablets, 3D based tablets and many more are drumming up interest right now and it’s a good thing. The more companies are willing to seek a specific niche in which they can excel, the more varied and advanced tablet technology is likely to get.

But for now, we are likely to see things shake out a bit between companies like Motorola, HP, LG, and Asus. Apple may have taken the crown in 2010 for mass market device of choice, but there are a lot of alternatives in 2011 hoping to give them a run for their money. 

Saturday, February 12, 2011

The Year of the Tablet Consumer

Since CES I’ve felt like we’re building to something – a showdown of sorts slated for this spring. With dozens of new devices coming out in the next few weeks and even a handful of new operating systems set to land, the tablet market is about to change in ways we’ve never seen before. So, what does it mean for consumers? Let’s take a closer look at the state of the tablet market.

Sales and New Products

In 2010, there were 17 million tablet sales, most of which were Apple iPads. In 2011 that number is expected to climb north of 40 million and include a lot more Android and Windows devices. How much more of the share will be for other manufacturers remains to be seen, but one thing we can be sure about is that the ecosystem model developed by Apple isn’t going anywhere.

People want a device that provides a complete system. They want App stores and operating systems they come to know and trust throughout the day. They want a device that is operational but also a part of their identity – and while PCs and phones have done this, tablets stand to be even more of a cultural touchstone because of their mobility and the fact that they will be shared and used frequently in the presence of others.

Developments Coming Soon

As of two days ago, the signs still point to a release of the Motorola Xoom tablet on February 24th. The Best Buy ad leaking the launch date also pegs the price point at $799 and shows a variety of data plans for those wanting high speed access.

When the Xoom launches it will signal the opening salvo in a yearlong back and forth between Apple and everyone else. While Apple clearly dominated in 2010 it was mostly because they blindsided the market. Other developers were not ready for the raw demand for tablets while Apple played the cards and guessed right. They subsequently cleaned up because of it.

In 2011, things won’t be so simple. New devices will likely come out with better technical specs and stronger performance numbers than the iPad, even after the iPad 2 launches. Apple will surely upgrade their device in April with a dual core processor, much more powerful screen and at least one camera, but will it be 4G? Will it support SD slots? Will it have HDMI out? These and a dozen other questions will fill the articles of tech writers everywhere and will likely impact how consumers respond to the flood of new devices.

And then there are the other guys. We cannot forget about RIM and their Playbook release set for some time in spring or summer. MeeGo may see its first major release in 2011 as the open source OS continues to gain steam. HP continues to promise a slew of new options in WebOS for tablets and Windows 7, despite a lack of new innovations at CES will continue to appear on new devices, including a number of convertible tablet/netbooks.

If 2010 was the year of the tablet, 2011 is the year of the consumer – users will have more options and greater opportunities to make choices that reflect their needs and desires in a device. Now, we just need to sit back and wait to see what the consumers decide. 

Wednesday, February 09, 2011

Five Things You Need to Ask Before You Choose a Tablet Operating System

It looks like we are only a couple weeks away from the first Honeycomb tablet hitting store shelves. To commemorate the moment and the soon to be rampant iOS vs. Honeycomb conversations, I want to talk about what an operating system should do for its user.

This post is not designed to single out any one operating system and declare it the “best”, though I’m sure we each have our opinions on that matter. Rather, I want to talk about what a good tablet PC should do for its user. We all use technology in different ways so we all have different expectations for what it will do.

1.       Is it Truly Mobile?

One of the primary reasons tablets are so attractive is that they provide an untethered alternative to a desktop computer (and are markedly lighter than notebooks). But, in the age of streamlining and cloud connectivity, is your device really 100% mobile? Remember that tablet computers do not have optical drives and their storage space is usually limited to less than 64 GB (usually around 16-32) with some offering SD expansion slots. If you are required to plugin to software on a desktop or constantly delete and replace files, mobility suffers. In this category, iOS suffers due to its reliance on iTunes while Android works wonderfully due to its support for over-the-air updates and SD backups.

2.       Will I Use it for Work?

Technology makes work easier, so many of us want to use our tablets to reply to emails, check spreadsheets and finish a few last minute edits. Some systems are better suited than others. A Windows tablet has access to Microsoft Office while Android has a burgeoning security environment starting to develop. A lot of enterprise users are waiting for the Playbook to arrive as well, to see what it will offer.

3.       Will I Switch in the Future?

If you plan on changing devices in the future, iOS is out of the question. After spending hundreds of dollars on iOS Apps, it will be hard to make yourself replace them all on an Android or Windows device. Android is likely the most versatile device in this regard. MeeGo, while not yet available in most markets, will likely provide similar flexibility.

4.       Apps or Hardware?

Are you a fiend for the highest end hardware or do you want the largest selection of Apps? By far, iOS wins the App arms race, though Android is close behind and the number of tablet specific apps is only growing. Windows suffers in software, but the devices tend to be decently powerful and provide a good number of enterprise features.

5.       How Often Will I Use It?

Finally, how often do you plan on using your device? If you just want a device to entertain you on an airplane or train, Apple’s iPad is a great choice because of the sheer volume of movies, TV shows and apps. However, if you plan on using your tablet as a complete replacement for your notebook or desktop, you’ll want something more powerful and capable of being fully untethered all the time.

Choosing a tablet device is getting harder with each passing month as new options hit the market. So, be sure to spend enough time getting to know your options. It’s likely the OS you choose now will be with you for some time to come. 

Sunday, February 06, 2011

Honeycomb Gets Close and New Devices Start Teasing

There is a lot of news to talk about this week, though on many sites you must sort through page after page of notes on the Verizon iPhone. For those not in the United States, the battle between iPhone users and AT&T isn’t that big of a deal, though it is interesting from the standpoint of market share since, as the largest consumer base for smartphones in the world, when something changes in the US it has resounding effects around the world.

That said, I’m intrigued by the slew of recent release dates, rumours and new content additions that have appeared on the radar of late. To start with, no one can quite figure out when the new wave of tablets will arrive this spring. An errant Best Buy Facebook Page accidentally said that the Xoom would be available on February 24 in the US. While this hasn’t been confirmed or denied, it seems more and more likely considering how long Motorola’s been sitting on this device.

Of course, since Honeycomb officially debuted three days ago, the floodgates are starting to slide further open as more people prepare to launch their first Android 3.0 devices. Our first official look at the OS was nice – the same slick interface we’ve come to know and love from Android but optimized for a bigger screen.

At the same time, news is swirling around the perceived announcement of an iPad 2. No one really knows when Apple will officially announce it, but Darrell Etherington at GigaOm doesn’t think it will be in the next week (at the 4.3 unveiling), if only because it’s too far from the likely launch date and Apple needs to be more careful with their announcements now that they have real competitors. To me, if the Xoom really does hit soon, I see Apple laying out their plans shortly afterwards to cut off the likely sales of Motorola’s new device, but it remains to be seen if that will happen. The price point for the Xoom will have an impact as well.

In other news, The Daily was officially announced this week and along with it a handful of competitors like New York Times’ I’m interested to see if this surge to provide an iPad newspaper will cross over to other tablets. It’s obvious that the news media and print industry are playing catch up right now, but at some point, they have to start to thinking ahead – whether for new devices or their admittedly weak subscription plans.

I suppose the message from this week is that we’re in a bit of a limbo phase. While there are some new devices hitting the market (the Dell Streak 7 arrived with a slightly disappointing screen and the first Asus Eee tablet with Windows is finally available), the big boys are still on hold – soon enough though we’ll get our hands on the Playbook, Xoom and iPad 2 and can start really arguing over which is best for 2011. 

Thursday, February 03, 2011

Getting Behind the Tablet Sales Numbers

One thing that a lot of tablet PC prognosticators like to do is gauge and measure the market, either while a device is available or weeks to months ahead of its launch. So, when we do get data, inevitably it will be thrown around a dozen different ways before we understand what it really means.

Sometimes, numbers are simple. Estimates of more than 13 million iPads beings old seem realistic considering the demand for the device and the capacity at most retailers. However, the numbers for the Samsung Galaxy Tab, which reported to have sold 2 million units, are not quite the same. Usually, statements like this mean “2 million shipped to retailers” not actually sold to end users. We don’t know how many that means, but company statements have already tempered it quite a bit.  

Measuring the Future

What does that mean for companies that have a new device coming out in 2011? What does it take to create a mainstream device and how does the public generally respond to certain features? No one knows. In fact, right now, the only devices on the market to draw data from are the mega-selling iPad and a dozen or so smaller devices with varying reviews and sales numbers – none of them with outstanding selling points.

I think that niche devices like the Playbook will actually sell decently well to their respective markets, though whether they can be mega-sellers in the mass market remains to be seen. I also think that there will probably be at least one other breakout device in 2011 – most likely the Xoom, though LG’s new tablet is starting to look very attractive with the announcement of multi-carrier 4G support and 3D playback.

We have no idea what will drive end-user interest. Reviews, technical specs, and usefulness have never really been the determining factors in what sells in the technology industry. Apple’s products are never the most powerful or the most feature-rich – they are often the “coolest” and that works for them. So, to be successful, does a company need to “out-cool” Apple or can they simply find their way into the niche through a variety of highly useful, mass-market features?

It remains to be seen. But, I have a feeling in 2011 we’ll be doing a lot of number parsing as sales numbers like that of the Galaxy Tab start to pour in.