Anticipating the Apple Tablet
January 4th, 2010
Daniel Eran Dilger
Everyone is taking turns speculating about The Tablet that Apple is expected to debut about three weeks from now. It’s my turn.
There’s a lot of consensus about Apple’s upcoming Tablet, apparently because nobody wants to say anything provocative or risky. It is almost unanimous that it will physically be a large, 10“ version of the iPod touch. Everyone is expecting a color display with perhaps HDTV resolution and the same type of multitouch screen as the iPhone, supporting an expanded user interface incorporating some sort of 3D elements.
Nearly everyone sees this product as being targeted to consumers as a way to browse the web (with HTML5 savvy), play iTunes content (and particularly that new iTunes LP and Extras stuff) and view rich multimedia magazines and newspaper content along electronic editions of traditional books.
Other manufacturers are all scrambling to get out their own tablets in advance of what Apple is bringing to market, apparently trying to capture the same level of success associated with PlaysForSure players, the Zune, the LG Prada, and the Palm Pre, each of which beat Apple to certain features by a matter of months.
iPod vs Zune: A Buyer’s Guide
Apple iPhone vs LG Prada KE850
Palm Pre: The Emperor’s New Phone
Tablets of failure in the 2000s.
It was almost ten years ago that Bill Gates demonstrated his vision of Tablet PCs at Comdex 2001, lining up more hardware partners than today’s Android currently enjoys in order to show off a variety of laptops stripped of their keyboards and instead piloted by a stylus.
Bill Gates’ revolutionary Tablet PC was a big Newton Message Pad, ten years late and running Windows XP. But that wasn’t enough to make Microsoft successful in introducing Tablet PCs to mainstream consumers or even business users, for some of the same reasons Apple’s foray into creating the ”Personal Digital Assistant“ flopped. Microsoft’s Tablet PC was too expensive to compete with conventional laptops, too big to be much more mobile than a conventional laptop, and too slow to be useful in place of a conventional laptop.
Microsoft also ensured that the software wasn’t really ready for prime time, nor really capable of doing much you couldn’t already do with a conventional laptop. It also didn’t help that a recession was beginning, sapping any interest in frivolous gadgets in general.
Apple shuns the tablet hype to focus on existing markets.
In 2001, Apple ignored Microsoft’s Tablet PC initiative to instead concentrate on investing in the conventional laptop and the software that would run it. Over the next decade, Apple’s success with the Mac platform came largely through sales of its notebooks, enhanced by novel and practical features rolled into Mac OS X, iLife, Pro Apps and other Apple software.
There’s no need for extensive research into which vision of the future worked out best. Apple’s MacBook line has turned into the main driver of its Mac sales, and the company has morphed from a niche maker of boutique, specialized PCs into a retail giant that captures the lion’s share of all premium-priced computers, and therefore also the most attractive segment of PC sales in terms of profits. More than half of those sales are notebooks.
In contrast, Microsoft’s Tablet PC idea never gained much traction. Instead, the company has scrambled to match the features Apple delivered in Mac OS X and tried to whip up suitable equivalents to iLife apps to get consumers to keep buying generic PCs running Windows. But Windows was so bad at supporting laptop features such as sleep/wake power management that Microsoft entertained silly ideas like SideShow, which added an external, expensive mobile device to the top of laptops to avoid needing to power them on.
Additionally, Microsoft had little control over what its hardware partners were doing, so it could only watch as Apple’s MacBooks got more sophisticated and refined while its own partners churned out increasingly cheaper and lower quality laptops aimed at cheapskates. These cheap laptops did nothing to suggest any future for Gates’ Tablet PC fantasy.
Beyond Microsoft, we’ve seen a variety of other attempts at handheld systems that range from stripped down mini-laptops to big PDAs. The most successful and hyped segment of the PC computing market these days has been netbooks, which are just cheap and small laptops. Their relative popularity says more about the lack of innovation among PC makers than anything else. Once you run out of ideas completely all you can do is try to sell the same stuff at a lower price. Just ask China.
Also in the works is Google’s Chrome OS, which replaces Windows on low end netbooks and tablets with a closed Linux distribution only capable of running a web browser on steroids. This isn’t entirely new, and won’t be available until the end of the year. When it does arrive, it will be competing for attention with Android-powered netbooks and small tablet-form factor devices that resemble the iPod touch, including Apple’s.
2010: The Year We Make Tablets?
Given the history of last decade, why would Apple be floating a tablet now? Well for starters, Apple’s conventional notebooks are now significantly more expensive than bargain-bin PC laptops. This is probably not something that can be sustained indefinitely. Apple also has harvested all the low hanging fruit in MP3 players, smartphones, and personal web browser devices. Apple has also stoked a tremendous fire inside its iTunes App Store.
The circumstances are right for Apple to provide an alternative to the conventional laptop computer, not following Microsoft’s vision, but rather its own. In 2001, Microsoft’s strengths were in its Office suite and Windows platform. It imagined that creating a Tablet PC reference design would bud the PC world into a new branch of specialized devices that would provide new reasons for people to buy Office and run its apps from the 80s enhanced with the stylus of Pen Computing that had repeatedly failed in the 90s.
Today, Apple’s core competencies related to mobility are in designing attractive hardware, integrating music and video content, managing a third party application store, and developing simple, intuitive user interfaces. This aptitude took a decade to pull together, starting with the iPod line, the iPhone, and the iPod touch.
But Apple also still makes conventional Macs, primarily iMacs and MacBooks, and creates lots of conventional desktop software from iLife to Pro Apps. Still, there is no reason to think that a tablet Mac would be popular or useful, and conversely, there’s a reason to think that it wouldn’t: the ModBook, a third party attempt to fashion a Microsoft-style Tablet PC from a MacBook. While that product functions, it doesn’t do anything anyone really needs or wants, just like Microsoft’s own Tablet PC offerings.
What would make a Tablet useful?
Rather than making a tablet form of a Mac, Apple is much more likely to scale the iPod touch up, adding new applications and capabilities. Instead of being a way to work on Office documents with a stylus, the Apple Tablet appears to be targeted as a way to navigate information and Internet-enabled apps, much like the iPod touch.
Just months after launching the iPhone, Apple attempted to scale it down as an iPod, lopping off features like Bluetooth (and the phone, obviously) and scaling back the bundled software. Users were annoyed that Apple had attempted to use artificial boundaries to differentiate the two, and the company finally relented by adding all the core iPhone OS apps to the iPod touch. It also eventually brought the iPod touch hardware up to par with the iPhone.
Last year, Apple released a new cheaper iPod touch that signaled that the company had worked past its fears that the iPod touch would compete against the iPhone. The company realized that widespread availability of the iPod touch would expand the market for the App Store, which itself would benefit the iPhone and software sales in general. Part of the reason why Apple remains untouchable by Android is because Apple has one iPhone model and the iPod touch backing it up in the App Store. Third party developers get bites from two different fish on every baited hook they cast.
To be successful, Apple’s Tablet will need to fit into the existing product line and strengthen it without killing what’s already there, just as the iPod touch was able to do. Apple has previously demonstrated the willingness to boldly challenge its existing product offerings by replacing them with something entirely new (such as the iPod nano replacing the iPod mini). With the Tablet however, Apple has nothing to replace outright. It’s not going to dump its MacBook line nor the iPod touch. This isn’t an upgrade of an existing product, it’s an extension into a new market.
Same same, but different.
Fortunately, there’s a lot of room for complementary products between those two. To avoid competing with its conventional notebooks, the Tablet needs to differentiate itself from being a full-fledged PC. Like the iPod touch and iPhone, it will be a browser of information, not an editor. It won’t run page layout apps or edit full videos or create music. Unlike the iPhone and iPod touch however, it will offer a much larger screen, making it more suitable for interacting with textbooks and magazines and newspaper layouts, as well as iTunes LPs and Extras.
While the small screens on the iPhone and iPod touch are very usable for browsing the web and casual reading, they don’t support any playback of inline video because it doesn’t make sense to view an embedded video within a webpage on a 3.5” screen, regardless of whatever the Flash-bound hoot about in their Adobe-insanity. Instead, when you select a video the iPhone opens in its own QuickTime player app, similar to how PDFs or other documents are viewed. The Tablet’s much larger display certainly could render video inline, creating a very different and much more interactive overall feel.
This indicates that the Tablet will indeed be a scaled up iPhone OS device, with seamless backward compatibility with its smaller siblings. There is no need for the Tablet to run conventional desktop apps, and allowing this as a possibility would require bringing Carbon and Java APIs ahead into the next generation of the mobile Mac. No, it’s much more likely that the Tablet will be running Cocoa Touch apps only, and similarly run them in a sandboxes environment and distribute them though the App Store exclusively. These are all reasons why this won’t be a standard Mac.
As with any 1.0 product, Apple needs to restrict its feature set so that it does a few marketable things really well, while avoiding any critique of the other things that aren’t yet ready. The original iPhone didn’t attempt to do copy and paste or undo. Of course, the Tablet will because it isn’t running 1.0 software, but rather iPhone 4.0 software. Investment into new Tablet features (such as interface enhancements) will very likely trickle back into the iPhone and iPod touch, just as the investment into the iPhone found its way to the iPod line.
There will also be elements of the Tablet and iPhone 4.0 that make their way into Mac OS X 10.7, which is expected to debut at WWDC this summer. Enhancements to Quicktime X are an obvious one, following the pattern of moving the iPhone’s modernized subset of QuickTime into Snow Leopard.
What would make a Tablet new?
At the same time, the Tablet is likely to benefit from some desktop Mac OS X features that the iPhone and iPod touch haven’t begged for due to their size. Consider the ability to wirelessly print to local printers. That’s a handy (but not required feature) on a smartphone, but a lot more useful and necessary if you’re working on a slate-sized machine. Once perfected for the Tablet, this will likely find its way to the iPhone and iPod touch in iPhone 4.0.
Another example of a likely desktop feature to appear on the Tablet is the ability to browse local websites via Bonjour, browse local iTunes shares (and participate in iTunes’ new Home Sharing feature), local iPhoto libraries, and so on. It would also make sense for the Tablet to share its own files and photos and other content for easy file transfer with other Tablet and desktop Mac/PC users, something that Apple avoided adding to the existing iPhone 3.0 firmware, likely for battery life considerations.
Additional horsepower, screen size and battery will also lift other limits currently imposed on the iPhone. I’m imagining it will debut Apple’s strategy for allowing certain third party apps to run in the background, something that is likely to eventually make it to new iPhones with increased horsepower as well.
A more sophisticated Calendar and Contacts app would enable Apple to push into the Enterprise both as a novel tablet-format client and as a server vendor, once it can manage to sort out how to offer fully functional corporate calendaring and directory services with push messaging. And what better client would there be for remotely managing servers than a Tablet?
With VNC screen sharing (the same technology behind iChat and Apple Remote Desktop), the Tablet would serve as an anywhere, anything PC on top of what it already does, with little to no effort from Apple. VNC was invented to support tablet devices on a fast network, and now we have the formerly missing technology to support both tablets and fast networks.
A remaining question mark hangs over how users will enter text. Will it be entirely though a virtual on-screen keyboard like the iPhone? Will it work with Bluetooth keyboards, another feature that should soon make it to the iPhone as well? Will it incorporate some flashy new technology such as voice recognition, which still barely works on a full power desktop? Will Apple relent and use a Newton-style stylus, which users have scorned for two decades now? I’ll have to wait and see about that.
A Brief History of Remote Display (VNC)
What would make a Tablet affordable?
Apple’s key feature of the iPhone was to bury its true hardware cost using carrier rebates and then subsidies. While it’s possible the Tablet could similarly be tied to a WWLAN contract that also subsidizes its price, it’s unlikely that a large number of consumers who have already signed up to use the iPhone for around $80 a month would jump at the prospect of paying their carrier double that to use an iPhone and a new Tablet, even if it made obtaining the Tablet cheaper from the beginning.
Instead, it’s possible that AT&T and other iPhone carriers might partially subsidize the Tablet with a cheaper data-only contract tied to the same account, so you’d be paying about $40 more to use it. It’s also possible that the Tablet could be sold as a device intended to be used with a tethered smartphone, meaning that you’d have to sign up for a tethering plan that doesn’t offer any hardware subsidy, but also doesn’t require a dedicated monthly service plan just to use the Tablet.
Since the Tablet isn’t as mobile as an iPhone or iPod touch in terms of size, it also makes sense that it could be WiFi only, with the expectation that you’d use it somewhere where WiFi was available, much like Apple’s lineup of MacBooks. Sold as a MacBook companion and/or alternative, the Tablet could become popular at a price of around $800-$1000, although the current recession is going to limit such a device to the well heeled and those of us who can’t say no to crazy new futuristic gadgets.
Recall that was the price range of the 90s Newtons, although inflation has made those figures more affordable than they once were; a $1000 price tag in 1994 dollars would look equivalent to about $1450 today, and a $1000 device today would feel similar to a $700 gadget back then. Today’s Tablet at any price will be cheaper and more accessible than the Newton, but will also have more competition for attention.
Making the Tablet cheap.
There’s also a third alternative to the iPhone’s service subsidy and iPod touch/MacBook direct payment: an Apple subsidy. Recall that Apple has two storefronts selling media that this device is pretty much guaranteed to consume: iTunes music and movies and App Store mobile software. There’s also a third segment the company is known to be working on: a cable alternative of episodic TV subscriptions. The idea is that you pay Apple $30 per month to allow you to download TV from participating networks.
If Apple can pull this off, you can add iTunes TV to the list of features the Tablet will perform, and it may therefore make sense for the company to shave some money off the price of the Tablet hardware in order to ensure that it will have a guaranteed number of subscribers. Plenty of people would sign up for a year long cable contract that enabled them to watch episodic TV from anywhere they could find WiFi, with no commercials and no futzing with a VCR or DVR like Tivo, which requires jumping through some hoops to get the programming onto a mobile player.
Like the iPhone, the Tablet is also likely to expand the audience of MobileMe, although at $99 per year, Apple is unlikely to earn enough from new subscriptions to offer any real subsidy. However, adding slick web-enabled online apps to its Tablet would clearly increase its potential too. Even better would be native apps for browsing MobileMe galleries, something that Apple has somehow failed to offer on the iPhone.
A tangled web of products.
A Tablet tethered to the iPhone could potentially borrow its GPS and compass information, serve as a data uplink, a phone uplink, a video phone uplink if the Tablet has a front facing camera, and perhaps support other interactions. A Tablet with a MiniDisplayPort (or even just a USB/iPod connector) could act as an accessory touch screen monitor for a desktop system, making it a companion rather than outright Mac replacement, something that the Newton failed to do, WinCE failed to do, and the Palm Foleo failed to do.
The Tablet running Apple’s Remote app would also potentially boost the visibility of Apple TV. Just demonstrating an app that does presentations and launches content on an Apple TV enabled display would sell packages of both to lots of companies. Everything is cheaper by the dozen, which is why the price of the iPhone plummeted once Apple realized that users would indeed flock to purchase it volume.
There is also one last way Apple could make the Tablet affordable: choose to make less money on it initially in order to suck all the oxygen out of the tablet market, ensuring that it remained the key player in mobile devices and software. By selling the Tablet near cost, as it does with Apple TV, Apple could create a huge installed base and quickly bring down component costs via economies of scale. Once it sold its first five million, there would be intense pricing pressures keeping rival devices from entering the market with me-too devices.
This may seem uncharacteristic for Apple and its customary high margins, but it’s exactly what the company did with the latest iPod touch, and its what Apple executives warned they were increasingly going to do in general terms. With complementary ties to other products, services, and content, Apple has less need to make all of its cash upfront from hardware sales. Of course, Apple is still making healthy margins on its iPod, iPhone, and Mac product lines, and it has vast reserves of cash, meaning that floating a Tablet in the style of Apple TV isn’t a crazy idea.
The other tablets in the rear view mirror.
Once Apple drops its detail bomb, the market will have limited time to respond. Nobody making Android tablets has an App Store full of iTunes content, nor deals to sell digital news and periodicals, nor a push messaging and personal content hosting subscription plan, nor a TV appliance, nor a TV subscription plan in progress. Android as a platform still lacks last year’s $199 iPod touch or even a real equivalent to the iPhone.
The same can be said for Nokia’s Maemo and Symbian and Microsoft’s Windows Mobile and RIMs BlackBerry and Palm’s WebOS and Samsung’s Bada. And none of these, save Microsoft, have a viable desktop PC platform with development tools that scale from the conventional desktop to smartphones to tablets-form-factor devices. Conversely, Microsoft doesn’t have a successful MP3 player, nor a successful smartphone platform, nor a desirable tablet, nor even a content and software marketplace with any significance.
That should clarify how quickly Apple’s rivals will manage to catch up to its new Tablet. Given the weak competition Apple faced against the iPod and the laughable efforts that leading mobile companies have ineffectually thrown under the wheels of the iPhone, it’s hard to imagine that Apple’s Tablet won’t similarly define the future of tablet devices while maintaining a strong lead for the foreseeable future.