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Apple finally announced the iPad, its tablet PC, at a Jan. 27 presentation in San Francisco. The high-intensity buzz that built online in the weeks and days before the device’s unveiling will likely continue for some time to come, as the same analysts and pundits who debated the then-vaporware’s possible features now turn their attention to its likelihood of success or failure in the market.
For the moment, it seems that many of the tech competitors due to be directly affected by the iPad’s release in two months, such as Amazon.com with its Kindle line of e-readers, have chosen to remain relatively quiet. During the Consumer Electronics Show, held in Las Vegas at the beginning of January, many manufacturers announced tablet PCs due to roll out later in 2010, perhaps hoping to benefit from the anticipation for Apple’s product; whether they will succeed in presenting viable alternatives to the iPad remains to be seen.
The iPad has a 9.7-inch LED backlit glossy multitouch display with IPS technology, capable of displaying multimedia with 1024-by-768 resolution, and connectivity courtesy of either a Wi-Fi connection or combined Wi-Fi and 3G. The 1GHz Apple A4 proprietary processor, combined with either 16GB, 32GB or 64GB flash drives, will power a broad range of applications. Apple rates the device’s battery life at 10 hours.
One potential competitor issued a cautious missive to the press on the same day as the iPad announcement.
“The introduction of another mobile device, which includes digital reading as part of its functionality, is a good thing for the digital book business,” Steve Haber, president of Sony’s Digital Reading Division, said in a Jan. 27 statement. “Mobile devices with reading capabilities will play a key role in the paradigm shift from analog to digital content. At Sony, we’re focused on devices optimized for digital reading and believe that digital books sales will surpass print sales within five years, if not sooner.”
In a research note published following Apple’s announcement, IDC painted the upcoming battle between Apple and e-reader makers, in particular Amazon.com, as a somewhat even fight.
“Apple is taking on Amazon’s Kindle directly with iPad, though iPad has weaknesses as a dedicated e-book reader and its entry level cellular-enabled model is $629, much more than Kindle’s $259,” IDC analyst Susan Kevorkian wrote in a Jan. 27 research note. “IPS offers a better viewing angle than traditional LCD technologies, but is not any better than other LCDs outdoors, and its backlighting can induce discomfort from eyestrain, something that Kindle has hedged against with its E Ink display technology.”
The iPad does possess certain advantages over existing e-readers, she went on to suggest.
“However, iPad’s color display opens it up to a realm of color content not supported by Kindle,” Kevorkian wrote. “The new iBookstore, supported with partnerships with five major publishers (Penguin, HarperCollins, Simon and Schuster, Macmillan, and Hachette) give legitimacy to iPad as a reading device.” In addition, she said, various publishing industry players could use the iPad to “experiment with new ad-based and premium business models in order to develop the digital distribution channel as ad-based print distribution declines.”
The Killer Apps
What may have a larger effect on the tech world, however, was Apple’s perhaps-necessary decision to release the iPhone SDK (software development kit) 3.2 beta in conjunction with the iPad announcement, allowing developers to start creating programs for the device in the two months ahead of its release. The SDK includes an iPad Programming Guide, iPad Human Interface Guidelines and iPad Sample Code. Already, about 140,000 applications will be available for the iPad through the App Store when the tablet is finally released.
Earlier in January, Apple announced that the number of applications downloaded for the iPhone and iPod Touch had reached 3 billion. The development ecosystem associated with Apple’s mobile devices has helped it become a force in the smartphone world, and the company is likely hoping for the same effect in the tablet PC arena. Competition could come from Intel’s AppUp Center beta, which will offer software applications for Windows- and Linux-based netbooks.
In a keynote presentation at CES, Intel President and CEO Paul Otellini suggested that applications from the AppUp Center would eventually be available in the “handheld and smart TV space over time.” Presumably, Windows- and Linux-based tablet PCs from manufacturers such as Hewlett-Packard will be able to utilize applications from AppUp Center and similar online storefronts; if the number of applications is small in comparison with those available for the iPad, though, then a replication of the past years’ smartphone-application competition could occur, with other companies attempting to play catch-up even as the number of App Store entries increases exponentially.
“The question for Apple is: What is the usage case for such a product?” Jagdish Rebello, principal analyst of research company iSuppli, wrote in a Jan. 27 research note. “What does it do that other products don’t do-and what does it have that will make a large number of consumers want to buy the product?”
The iSuppli research note then suggests that the iPad’s killer application, so to speak, may be its delivery and presentation of multimedia and other content; by uniting an ecosystem of partners to deliver everything from music and games to e-books and digital periodicals, Apple creates a footprint larger than that of the Kindle or other tabletlike devices.
“While the iPad might appear to compete with many existing products in specialized markets like e-books, tablet PCs and PMP/MP3 players,” Rebello added in the research note, “the success of the product is intrinsically linked to its capability to change consumer behavior.” Overall, iSuppli’s view seemed to be that Apple’s “loyal” customer base will embrace the device, possibly encouraging further adoption.
Furthermore, iSuppli postulated that the iPad’s proprietary processor was designed by a low-power processor specialist, PA Semi, which Apple acquired in 2008. Low power consumption allows the device to balance a relatively low weight with the theoretical 10 hours of battery life.
Much of the focus of the blogosphere’s criticism following the iPad’s launch-besides the device’s name-seemed to be on how closely it resembles the iPhone or the iPod Touch in use. Despite that, some analysts seem to feel that the iPad will not cannibalize those other devices’ market share.
“Positives: 1) Not cannibalistic to existing product lines (more of a media player, in our view), 2) affordable (ASPs starting at $499), 3) wide variety of connectivity options at attractive price points,” analyst Brian Marshall of Broadpoint AmTech wrote in a Jan. 28 research note.
“Negatives,” Marshall added, included: “Downside of prepaid contracts is no high subsidy payments from carrier partners … [AT&T] will be the initial carrier in the United States (versus hopes of [Verizon] … virtual keyboard will take time getting used to, and … no multitasking or camera functionality.”
As announced, price points for the iPad will vary based on options. The 16GB version will cost $499 with Wi-Fi, and $629 with Wi-Fi and 3G. The 32GB version will cost $599 with Wi-Fi, and $729 with Wi-Fi and 3G. The 64GB version will cost $699 with Wi-Fi, and $829 with Wi-Fi and 3G.
Whether the device ultimately succeeds or fails in the marketplace, however, it could be of great benefit for developers and publishing partners looking for a new arena and format in which to market their products.