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The slate effect

When the iPod was released in 2001 it managed, through intelligent marketing and product design, to capture the imagination of consumers, and the broader market. It wasn’t the only mp3 player on the market – and still isn’t, but it enjoys the lion’s share of consumer purchases.

The iPhone, first released in 2007, brought smart phones to the consumer. While RIM, Nokia, HTC and Samsung have attractive smart phones in their own right, it is Apple that had people lining up before store openings for the launch of the recent iPhone 4 – Apple had people lining up for a phone.

Now, with the iPad, Apple is already on track to repeat this success a third time – this time taking on the netbook or lower-powered notebook market with a gadget that is sleek, sexy and works really well.

Launched just a few months ago on May 28, iPads are an increasingly common sight at airports, train stations, and lounge rooms across the country. Thanks to the Android platform and, of course, Microsoft, there are a host of rival ‘slate’ devices on the way or out already.

But the iPad is also doing something that no one else perhaps expected – its gaining traction in business. While netbooks have always had questionable applications for businesses, and minimal traction in corporates as a result, the iPad is finding a place in vertical applications from automotive (replacing car manuals with iPads) to retail POS, entertainment to mobile workforces.

Much like how the iPhone’s popularity essentially forced organisations to find it a place in the IT infrastructure, the iPad is a device that people want to take to work – the question is, is it a threat to the business of more traditional notebook vendors?

After all, it’s easy to demonstrate the increased value of a fully-featured notebook over a netbook – by definition a cheap and underpowered notebook, but the iPad – and other slate devices are just different enough to not be a ‘mini-notebook,’ but ultimately they’re competing for the same dollars.

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On the face of it, notebook vendors are not too concerned with the potential threat posed by the iPad.

“I think of the iPad as a sports car that you take on the weekend, and the notebook as the all-rounder family car,” Fujitsu PC Asia-Pacific Product Manager, Hansen Yap, said.

“I think it’s an additional market. There’s enough space for both, and it’s a good thing that Apple is helping us to educate customers that there is a really cool usage model with slate form factors.”

For individuals or organisations with large disposable incomes or large IT budgets, this might well be case, but at the same time, the cheapest model of iPad is currently $629. For the basic 3G model, which is what mobile workers or IT department would be looking at, it’s $799.

You would have to expect that at that price, students at schools trialling the iPad won't also be getting regular notebooks. It's just as unlikely that a corporate is going to be interested in two sets of mobile rollouts and refreshes.

Then there was the report in July that found eight in 10 business professionals in the US rely on their smartphone as the primary business communication platform, and would rather give up coffee than surrender the smart phone.

The survey also indicated that 34 per cent of respondents use on the smart phone more than a PC for business computing and that seven per cent leave the laptop at home and rely purely on the smart phone when travelling.

The iPad is certainly a more attractive device for business computing than the relatively tiny smartphone. And, even as they tout the benefits of traditional notebooks, vendors are in reality not dismissing the slate market as one for the future.

Fujitsu PC, which does offer tablet computers – notebooks, but with touchable screens, said it was also exploring slates.

“We don’t have to rush to market, as we are not the first, but we are thinking about what the applications are and how customers will be using those devices – that’s important” Yap said.

Other vendors have in production (or have already released) their own take on the slate market, in an attempt to capitalise on the opportunities Apple is finding out there.

Toshiba, for instance, has the libretto W100. A dual-screen notebook, the device doesn’t feature a keyboard, relying entirely on touch inputs. It can be used as a notebook, with a virtual keyboard appearing on the bottom screen, or it can be used in ‘book’ form – an attempt to enhance the content consumption abilities that slate devices are best at.

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It’s a new device, and still finding its feet in the market, Toshiba product marketing manager, Justin White, said, but it’s one that could well turn into a corporate play.

“We’re seeing interest from that space,” he said. “They want to have a smaller, lighter device they can still sync with their primary computer, but then if they need to they can still access an manipulate all their data on it.”

That same trend has caused the vendor to release the A100 netbook – essentially a thin client device designed to operate within a corporate’s cloud environment.

As White notes, the devices might be in a period of transition, but corporate buying behaviour hasn’t.

“As far as the purchases are going they haven’t change significantly,” he said. “Corporate enterprises want to go for a device that is managed and they can run the major apps across the entire fleet, which you can do right now with slates.”

An inevitable trend?

Last year, Lenovo was awarded a major netbook provisioning contract with the NSW DET.

With Victorian schools making great publicity from iPad trials, it would seem that Lenovo’s netbook education business is under threat, and indeed the vendor is expecting a slow down in that market segment.

“I think there’s been a slow down in the netbook market and the introduction of the iPad will have an impact there – some of that market may move to the slate devices,” Lenovo product business manager, Lindsay Tobin, said.

Lenovo is persisting with Netbook releases – it has the IdeaPad S10-3T, a netbook multitouch device with the convertible form factor that Tobin claims many prefer.

But Lenovo, like Toshiba, is looking at a way to present the ‘coolness’ of the slate device in a new way and grab a share of that market.

At CES, the vendor showed off the IdeaPad U1 – a product designed to cross between notebook and slate.

“It’s a device that looks like a traditional notebook, but the screen can be detached and when it is, that screen operates like a slate device,” Tobin said. “It’s quite similar to the iPad, but using the Android OS.”

Without making specific predictions, Tobin said that overall, the iPad and slate technology had become something of a buzz word, and the vendor saw that as an opportunity for everyone.

“Some of our partners have said their customers are coming to them talking about iPads, and they want an opportunity,” he said.

“So that’s an opportunity for us to working with systems integrators and other partners to provide an alternative to fit that niche – products that have a similar type of form factor and advantages and are lower costs but good enough to fit into existing virtual desktop or Citrix environments, and we’re certainly seeing interest in that. It’s still relatively early in the point of change in the market you could say.”

So, niche as it might be at the moment, every indication is that the iPad and the slate form factor will be anything but niche in the future.

Although nobody is anticipating the death of the notebook, no vendor is ignoring the slate potential, rather they’re looking for points of differentiation, and some of the innovations that are hitting the market right now make the humble notebook look decidedly boring – both as a consumer and corporate product.