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. 


JC said...

Hi Hugo!

It is great to have you back and this is my first comment from your come back.

I agree there are a lot of options competing with the iPad, but you only metion big brands, how about Archos? It is a small player, but very well known brand in Europe amd wit great sales in US too. Amazing support and constant updates. From my point of view it is a shame that they don't have a stronger finacial arm to stock enough the market. It is amazing how fast the inventory from this company is sold out.

For me, the gen8 tables (internet tablets) from Archos are the best price/performance combination. And this is the model to beat in 2011.

Hugo Gaston Ortega said...

Hi JC!

Thank you so much for the warm welcome and the comment. It's fun to be back and really cool to see so many familiar faces, tweets and facebook links. :-)

About your query I think my writing and/or tone always takes into account the largest population possible. Regarding the Archos specifically I love the unit but have very little to do with it myself. I do however have a sweet spot for it and will do what I can to cover it more - and other smaller brands in the future. It's the small names which keep the big names honest. ;-)

Great to have you back too mate. After so many years togher. :-)