It is amazing to see the gold rush fever that's happening over tablets — no, it's astounding. Doesn't seem like anyone's had an original idea since Apple introduced the iPad and yet everyone plans on beating Apple at its own game without a clue or a strategy other than to show up with something that has a touch sensitive screen. Never mind that the OS they chose doesn't support touch, or that they haven't a clue as to who their prospective customer is — it'll all get figured out — if we build it, they will come.
So everybody except JPR has announced a tablet — is it too late?
But, who is going to use these tablets? Will they want a 7-inch or a 10-inch? Do they want Stereovision, do they want an app store, how about secure email, oh, and what about an eReader? And what do you think about 3G vs 4G/LTE. Wait — what about battery life?
Along with the 20 or 30 (lost count, who cares?) tablet offerings are the semi suppliers who have been chosen for these marvelous and miraculous copycats. All the semi companies are piling on: AMD, Freescale, Intel, Marvell, Nvidia, Samsung, STMicro, TI, VIA, and others with a design win or two — wow. A design win, gee. However, so far only Qualcomm, Samsung, STMicro, and TI have that magic stuff called sell through — hmmm.
So far we have two classifications of tablets: the Windows-based units sold to the commercial market (mostly medical and insurance, a little shop-floor), and for the consumer market there is Apple. However, Apple iPads have been used in some marketing applications (they're great for personal PowerPoint presentations) and people do use them for email, for work — occasionally.
But who's going to buy Acer, Dell, HTC, Lenovo, RIM, or Toshiba tablets? HP is a switch hitter with products in the consumer and the commercial market so their tablet(s) may find a home in one or the other.
What about Archos, Astri, Asus, Fujitsu, LG, Samsung, Sharp, Sony, Viewsonic, and the dozen (or more) Shenzhen tablets? Who's the customer for them — people who can't afford iPads or are brand adverse?
And if we can believe the recent DigiTimes story that Apple has locked up 60% of the touch screen production, where are those other tablet makers going to get their parts?
Then there's the battery and the radio(s). Does your tablet connect via 3G or LTE? Does your tablet run, with the radio on, for three hours, eight, or more? How thick is it? Is it a capacitive or resistance touch screen, and is it multi-touch? Does it have a camera, or two? How about S3D can you see 3D? And maybe most important, where and how is it sold, and does it have an app and content store? This tablet selling stuff is complicated isn't it? Are you sure they'll come if you build it?
So here we are again — the explosion before the storm. We saw it with the introduction of the minicomputer, the PC, graphics chips, MP3 players, and maybe netbooks. We're still seeing it with smartphone, and tablets are off the chart in terms of suppliers.
Now let's ask another inconvenient question — if tablets are soooo special, and so nifty, how come everyone and their brother can build one? Where's the secret sauce, the differentiation, the magic? Oh — there isn't any? You mean this is just like the PC explosion of the eighties?
The only difference this time is almost everyone in the new tablet bubble is an established company. They aren't going to be able to assimilate each other like they did in the early PC and graphics board days when it was a bunch of start-ups. That means most — 70 to 80% of these tablet suppliers are going to shut it down, write it off, and back-out of the market in a year or two, worst case three.
Now a lot of the suppliers, the big brand guys, think this is just another new category, like a netbook, and they will add it to their stable of products and have one and sell it like they sell their other products — notebooks, desktops, workstations, servers, etc — you know, you have to have a full product catalog. This is just another thing.
They may be right. And when that happens, when the consumers realize it's just another thing, then all those things become the same thing and the only differentiator is the price and maybe the brand. The brand may include the app/content store, and that may trump price. But even that may not be enough if cloud-based applications built on HTML5 could allow devices to become interchangeable — now the app store is commoditized.
Which means the brands with the cachet and the store with the higher ASP and margins win, and all the rest, the ones who survive to become just another item in the catalog limp along dragging down precious company resources for little gain.
But the most astonishing thing about this is — don't these companies with allegedly the best and brightest realize this? Are they that casual and irresponsible with their shareholder's investment that they will fritter it away on a gamble without adequate market research other than to look in admiration at what Apple has done? Should these people be allowed to keep their jobs?