Apple iPad 2: Consumer Catnip, No Great Advance for Businesses

Apple's iPad 2 could sway consumers based on price and features relative to competitors such as the Motorola Xoom. But businesses could be a tougher sell.

Within minutes of Apple unveiling the iPad 2, media outlets immediately began debating the next-generation tablet's ability to hold off the rising tide of Android-based competitors.

The general agreement seems to be that the iPad 2, equipped with a dual-core processor and hardware upgrades such as cameras, matches the capabilities of its highest-end rival, the Motorola Xoom. When it finally hits shelves at Apple stores and retail partners March 11, hordes of consumers will likely turn out to purchase one.

But for businesses considering whether to incorporate an iPad into their lineup, the next version of Apple's popular tablet doesn't include anything extra to sway their decision-making.

"Importantly, there were no real nods to business users in manageability or security," analyst Jack Gold wrote in a March 3 research note forwarded to media. "This is a challenge on the current iPad and isn't improved on this version (or iOS 4.3), despite Apple's drive to get large scale adoption of iPads into businesses."

For many enterprise workers, Gold added, the iPad 2 "will be attractive with its increased processing power, on-board cameras (although not all businesses see this as an advantage), and great battery life." For IT administrators, though, "there is a real and substantial cost to companies for deploying and maintaining these devices that users don't usually see or appreciate."

It could be a challenge for enterprises to deploy the iPad 2 in a secure way, while maintaining flexibility for users. On the other hand, third-party developers and IT firms that specialize in security and administration middleware could benefit from the pressure on IT administrators to introduce the devices into the enterprise.

Despite concerns about security and manageability, Apple's iOS enjoys a healthy rate of enterprise adoption, with a recent report from Good Technology suggesting that, for the quarter ended Dec. 31, devices running iOS represented some 65 percent of net new activations. The iPad's share of overall net activations grew from 14 percent to 22 percent over the quarter. By contract, Android activations grew to net 30 percent, and represented 40 percent of all smartphone (non-tablet) activations.

Apple has worked to install iOS features that increase the iPad's stickiness within an enterprise context, including wireless printing and greater security. In addition to Android-based devices, the iPad also faces business-centric competition from Research In Motion's upcoming PlayBook tablet, and Hewlett-Packard's webOS-based slates coming later this year.

In keeping with his combative stance toward other competitors in the tablet market, Apple CEO Steve Jobs used the iPad 2's March 2 unveiling event to take some swipes at the Motorola Xoom, which retails for $799. Citing the prices for various models of the iPad 2, he said: "Five of these six models are less expensive than $799. We only have one model that's more expensive than $799."

And for some consumers, price-point could be a substantial factor in whether they choose to purchase an iPad or a competing device. But for businesses still wary about tablets' place within their IT infrastructure, and used to a slower refresh cycle, the debate over whether to consider the iPad 2 will likely rest on arguments about security and manageability.