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Apple iPad invades vertical markets

Apple iPad invades vertical markets

For a consumer product, the iPad is showing an amazing ability to penetrate into vertical markets

Apple’s runaway success, the iPad, may well prove a disruptive technology in vertical mobile infrastructure.

The device has sold more than three million units since first launching in the US, and being brought into the Australian market on May 28.

Though initially considered a consumer play, various industries have already looked towards finding business applications for the tablet.

The Victorian Government publicly rolled out 500 iPads to students in one such trial, and is said to be looking into other potential verticals.

Hospitality has likewise shown interest in the slate. The Rydges Hotel in North Sydney has bought 10 for use as an interactive menu in its restaurant, and airline, Jetstar, acquired a number for entertainment use on flights.

In the US, concierges at InterContinental Hotels and Resorts have been equipped with iPads to provide guests with enhanced maps and directions, video recommendations, and instant booking confirmations for local restaurants, performances and attractions.

In a more unusual case, Hyundai announced it would replace the owner’s manual with an iPad loaded with the document in select models of car.

On the back of such success, a wide range of vendors have unveiled competitors – typically based on the Android operating system.

At Computex Taipei 2010, vendors demonstrating iPad rival slates included Compal, Acer, Browan Communications, Firstone Technology, Digitran and FuJian Sanxi Electronics.

Acer marketing director, Robin Tang, said while the vendor’s iPad rival would not launch in the local market until Christmas, Acer was not ruling any vertical market play out once it does arrive.

“We believe these tablets will create new usage markets,” Tang said. “We don’t see it as competing with the netbook form factor, but sitting somewhere between that and the e-readers.

“Initially it’s going to be very much a consumer play, however.”

Although the iPad plays in the same space as the portfolio of niche distributor, Tegatech, principal, Hugo Ortega, claimed the increased interest in ultra-mobile computing was benefiting his vertical-orientated business.

“We’ve actually had a spike in interest following the iPad’s launch,” Ortega said. “The iPad brought the awareness into the market, and then as part of due diligence, potential customers need to trial other products.”

And sometimes, those trials win out. Tegatech, through its European subsidiary, recently won a deal for 216 tablets that were explicitly purchased over the iPad, because Apple’s device was considered too 'nice', and management was concerned that devices would be stolen.

“The iPad has merit, especially in fields where aesthetics are more important than function,” Ortega said. “However, the iPhone didn’t kill off the other smart phones, and the iPad won’t kill off the Android or Windows platforms.”

IDC market analyst, telecommunications, Mark Novosel, likewise considered the iPad a device potentially capable of working in a wide range of verticals. However, whether it does take off will be very much dependent on the developers.

“Even with the right software, there are concerns around theft and how the devices are housed, but for any vertical, trials need to be conducted on the ergonomics of the device within the environment,” he said.

Overall sentiment seems to be that while the industry is considering rolling out iPad solutions, so far it’s been difficult to find a ‘perfect fit’ for the device, previously considered a consumer-limited solution.

Education is one especially strong potential market for the iPad, Novosel claimed, but there were lingering concerns over whether the devices would be rugged enough to suit that market.

However, one of the largest education resellers in Victoria, Computelec, has denied concerns over the iPad cannibalising into its market, despite the Victorian Government trial.

Computelec claimed the iPad lacked the functionality of a fully-featured tablet or netbook.

The retail sector was similarly dismissive of the tablet.

Retail Directions managing director, Andrew Gorecki, said that aside from queue busting applications, the iPad was too limited for the retail vertical. Other retail vertical players were likewise considering the iPad, but admitted Windows platforms were still dominant.

Simms International managing director, Danny Moore, said it was simply too early to see what vertical applications, if any, the iPad has.

“There have been some interesting stories about where the iPad is being reviewed, but it’s still caught up in the early stages of hype,” he said.

Simms International does not have access to the iPad, although it is a significant Apple accessories distributor. Protective accessories are the top sellers for Simms, indicating that people do have a strong attachment to the devices, Moore claimed.

“In the corporate space, I see the iPad as an additional opportunity,” Moore said.

“The iPad will never replace an iPhone or Blackberry, and we don’t see a lot of netbooks in corporates, where the iPad will be competing in the consumer space.”


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