Adobe is in full damage-control mode as it seeks to convince the world that Apple and not Flash is the true pariah in the new world of mobile computing. In the first new imagery since its introduction by Microsoft CEO Steve Ballmer at CES, HP and Adobe present the forthcoming HP slate device and demonstrate how it provides users with access to the "full Web and not just a part of it" -- as opposed to Apple's "incomplete" Web capability.
Notice in the video below, which is a "preview of Flash player and [Adobe] Air on HP's slate device," the repeated indirect critical references to the iPad without the mention of Apple or its anti-Flash devices:
My belief is that the iPad will be a success and devices that merely reproduce the PC experience on a slate without a keyboard will fail because they're a weaker version of a laptop -- that is unless they're very cheap.
Recent ChangeWave survey data shows considerable demand for the forthcoming iPad and, interestingly, a wave of "buyer's remorse" among some of those with other tablets and eReaders. According to the survey of "3,171 consumers, conducted in the aftermath of that Apple announcement (Feb 1-10)," 57% of eReader owners are either uncertain about their purchase or would have bought an iPad.
Here are the data:
Here's ChangeWave's "bottom line":
While the iPad launch is likely to strengthen overall e-Reader demand, the survey suggests Amazon and its competitors could well find themselves relegated to playing catch-up within just a few quarters if they don't preemptively move quickly to upgrade their own e-Readers.
Yesterday I said the good folks at Gartner were effectively clueless about whether or not the iPad would sell in quantity this year. But soon we'll find out what the preliminary (early adopters, fanboy) demand will be.
Apple announced this morning that pre-orders will happen on March 12 and the "magical and revolutionary" device will become available on April 3:
Apple® today announced that its magical and revolutionary iPad will be available in the US on Saturday, April 3, for Wi-Fi models and in late April for Wi-Fi + 3G models. In addition, all models of iPad will be available in Australia, Canada, France, Germany, Italy, Japan, Spain, Switzerland and the UK in late April.
Beginning a week from today, on March 12, US customers can pre-order both Wi-Fi and Wi-Fi + 3G models from Apple’s online store (www.apple.com) or reserve a Wi-Fi model to pick up on Saturday, April 3, at an Apple retail store.
There's lots of conflicting speculation and survey data on demand. Pre-orders and early sales will give the market a pretty good sense of whether this is going to be another hit or not. Price, which could be reduced, will also play a role. The "low-end" iPad, which will be the most successful of the many options, comes in at $499. This price was the big surprise at the launch event and much cheaper than the speculated $800-$1,000.
If you recall once the iPhone gained its subsidy sales took off. I think there's no question that at the right price, which for the iPhone was sub-$200, this device will sell well.
As this device moves into the wild, it will be interesting to see how people use it. AT&T CEO Randall Stephenson doesn't believe he'll get a lot of 3G subscriptions off the device. And I would agree; the "use case" is going to be at home, in hotels and other places that have WiFi (maybe in the car for kids and movies/games). In addition the people that buy this will have smartphones already for access to the mobile Internet "on the go."
IT consulting firm Gartner said today that global PC shipments will increase by 20% this year:
Worldwide PC shipments are projected to total 366.1 million units in 2010, a 19.7 percent increase from 305.8 million units shipped in 2009, according to the latest preliminary forecast by Gartner, Inc. Worldwide PC spendingis forecast to reach $245 billion in 2010, up 12.2 percent from 2009.
That kind of projection is relatively safe given that the economy is improving and there's pent up demand among consumers and enterprises (especially) for new machines. But Gartner goes on to say:
Apple's announcement of its upcoming iPad has created much discussion in the marketplace regarding market opportunities for traditional tablet PCs and next-generation tablet devices, such as the iPad. Gartner's initial thinking is that vendors could ship up to 10.5 million traditional tablets and next-generation tablet devices worldwide in 2010.
Here's where it all breaks down and falls apart.
Tablet computers have historically failed. The Kindle is a hit but it's not a PC. The many competitive eReaders (also not PCs) have yet to enter the market (except Nook and Sony effectively). The iPad (also not a PC) will be successful in my view but its success is highly speculative at best right now.
There will be a range of Android tablets (Nook is one such device) that may succeed (depending on price). These are also not PCs.
True tablet PCs -- flat panels or slates running Windows 7 -- are again destined to fail. That's because people will opt for Windows 7 netbooks or laptops instead, which are more functional. Tablet computers such as the HP Windows 7 device unveiled at CES are not going to sell (unless they're dirt cheap).
As for the non-PC iPad and its non-PC slate competitors (other than Kindle and Nook), any projected sales figures are completely speculative and pulled from the ether or someone's posterior.
Brands, agencies and marketers of all stripes are increasingly interested in mobile advertising (or so surveys reflect), especially in the last six months. However "a fragmented landscape of different devices, operating systems and application storefronts" is confusing to many: What should we buy and how?
Companies such as Velti, Amobee and others aim to simplify mobile advertising with "end-to-end" solutions. But confusion remains.
Meanwhile the data continue to show that mobile outperforms online by almost 5X in terms of most brand performance metrics. Those that get in now will reap the benefits while others remain on the sidelines whining and scratching their heads.
Here are recent data from a broad survey of Insight Express-monitored and measured campaigns:
Here's what the press materials said about these metrics:
The study used norms developed in online ad testing as a benchmark to draw conclusions around the performance of advertising on mobile devices. InsightExpress compared the two using InsightNorms, the company’s normative database containing over one thousand online ad effectiveness campaigns and over one hundred mobile ad effectiveness campaigns . . .
InsightExpress found mobile campaign norms were 4.5 to 5 times higher than online norms against measures of unaided awareness, aided awareness, ad awareness, message association, brand favorability and purchase intent. “Online campaigns continue to offer exceptional reach, flexibility and variety,” said Joy Liuzzo, Senior Director of Marketing & Mobile Research at InsightExpress. “However, the high levels of engagement, the explosion in technical capabilities, low levels of clutter and the novelty of mobile advertising all likely contribute to increased brand impact.”
A comparison of three different mobile media types (Mobile Internet, SMS and Mobile video) revealed that Mobile Internet is the current powerhouse. Mobile Internet campaigns resulted in increases of 9 percentage points for unaided awareness, 9 percentage points for aided awareness and 24 percentage points for ad awareness . . . SMS campaigns generated increases of 5 percentage points for unaided awareness, 10 percentage points for aided awareness and 18 percentage points for ad awareness.
SMS offers the greatest reach, followed by mobile Web and then apps and video.
An NPD Group survey has found (n=1,000) that 93% of eReader owners are “very satisfied” or “somewhat satisfied” with those devices. The survey didn't break out the devices (or at least what I saw). However most of those devices are going to be Kindle or Sony tablets at this point.
From the publicly released portions of the report:
The survey also found that "about three-in-ten owners say they use at least one another device for reading e-books, such as a PC or a smartphone."
Compare this to a Q2 2009 survey of netbook owners by NPD:
This higher level of dissatisfaction among netbook owners goes to expectations of buyers who anticipated more than what they actually received. There were undoubtedly different and fewer high expectations of eReaders. However the iPad may face very high expectations. By the same token it addresses some of the "wish list" of features above.
NPD in August last year also put out survey findings that asserted 37% of consumers were interested in purchasing an eReaders. Other surveys closer in time to the iPad launch showed much higher demand/interest.
Related: Amazon Said to Buy Touch Start-Up (to better compete with iPad)
The "post-mortems" on the iPad launch and related disucssion of the potential success or failure of the device makes me think in turn about the Google Chrome OS and the forthcoming Google netbooks that will come to market "by the holiday shopping season" this year. By that point iPad will have been out for about nine months. In addition other tablet competitors and eReaders will be flodding the market; winners and losers will start to emerge.
Netbooks have been enormously popular with consumers, because of their lower pricing. I previously argued about the Google netbook that pricing was critical to success here too:
Google knows that to succeed a Google/Chrome netbook will need to come in at less than $400 at the highest end and potentially around $200 to really take off. The economics of that lower price point may be very difficult to achieve. Accordingly Google & partners may need to distribute via subsidized mobile carrier relationships to bring the price down to the point where it will really get consumers’ attention. I would speculate that Verizon, given the Google-Android relationship, is almost certainly going to do this.
A Chinese company called Hivision has produced an Android (not Chrome) netbook that might sell for less than $200 in the US. It's unclear what the demand would be for this machine, but that pricing (without a carrier subsidy) certainly gets attention.
The Chrome OS netbook won't have any software on the machine; it's all about the Internet. So is the iPad, but it will have plenty of software on the device, including iPhone apps. The range of tablets, slates and eReaders will offer the Internet and varying levels of software support. Some of them will be suitable as a laptop or netbook replacement and some will not.
Netbooks have effectively made it difficult for PC makers to charge much more than about $650 for their larger machines. (Apple is the lone exception here.) But the fate of netbooks is uncertain in the wake of the new slate/tablet category. It will take at least a year for all this to play out, but netbooks could suffer if the iPad and its kin succeed.
As a kind of microcosm of this, the iPad and Chrome netbooks may wind up competing directly as portable Internet devices. Chrome will have more features and capabilities, but overall the iPad will be a more versatile and appealing device (depending on the software) as a "second computer."
Now back to price: the cheapest iPad is $499, the most expensive is $829. Apple is going to see most of its sales fall in the realm of $499 to $629. For Chrome OS netbooks to succeed they'll need to top out at $500. If they come in at less than $300 Google will probably see these devices sell. But, when considering a "second computer" (and this is a point to emphasize), if the prices are generally comparable -- in this case that means a $400 to $500 price point for both the Chrome netbook and the iPad -- I'd probably go with the iPad.
I wonder how many others would too?
On the morning after the iPad unveiling people are still trying to figure out whether consumers will want the device, what it might be good for and even what it is. The mule (half horse, half donkey) of mobile computers, it seeks to create (or solidify) a new category of devices that offer the benefits of smartphone mobility, but with a larger screen is are lighter and more elegant than a laptop or netbook.
A number of companies rushed out releases saying they would build apps for or support it. In the mobile advertising realm JumpTap, Greystripe and Mobclix were among the first to make announcements or public statements. Motally said it would provide analytics for the iPad.
Because of the high expectations there are a fair number of disappointed people. I'm relatively bullish on this device, but I see the confusion and hestitation as partly justified.
Many of those disappointed have characterized it as just "an iPod Touch on steroids," using the tired metaphor. But is it? The iPod Touch analogy and the fact that it runs iPhone apps suggests that many/most of the advertising options will be comparable. I believe, however, that there will be many more and more varied opportunities for advertisers on this device -- assuming it sells.
The 9.7 inch screen size means that ads on websites viewed through the Safari browser will be "viable" in a way they aren't currently on the iPhone or other smartphones. But it equally means that ads appearing within iPad-specific versions of magazines and newspapers will be more compelling and interesting than they could be within an iPhone app or on the mobile Web more generally.
Video will be central to the user experience, and so will video advertising. This is really the first device where mobile video advertising could get really interesting.
And then there's retailing and catalog sales; this could be another very interesting opportunity on this device. Imagine the Macy's catalog on this device with embedded e-commerce -- not the Macy's e-commerce website but a visually rich version of the catalog, where users can turn pages as do in the physical, paper catalog.
As these examples seek to illustrate the larger visual "canvas" will be a potential "game changer" (to use another tired metaphor) for marketers.
Another striking element about the iPad is the pricing of the 3G plan from AT&T. Many (including me) had expected a more expensive devices with a cheaper version subsidized by a two-year carrier commitment. Instead the device offers two options: $14.99 and $29.99. The latter is "unlimited" and unlocked; there's no contract required.
This pricing scheme may be a new precedent: low-monthly unlimited data on a non-phone connected device (Kindle doesn't count here). This isn't exactly like a dongle or wireless card. (BTW: this device can be used as a phone with a VoIP app.) However this lower-priced model for data could enable a wide range of new connected mobile devices. It could also bring competition from carriers like Sprint with additional capacity, looking for new revenue streams.
Before IDC Gartner made the same prediction, but by 2012. Both of these firms could turn out to be wrong -- very wrong.
It makes sense that Android will continue to gain, given the number of OEMs building and releasing devices with the OS. Indeed, Google SVP Jonathan Rosenberg, on the Q4 earnings call, said "Android started 2009 with just one device and is now at 20 in 48 countries." And the Verizon Android Droid is credited with dampening some of the iPhone's recent sales momentum: the iPhone sold "only" 8.7 million units vs. the 9.1 - 9.5 million that some of the most bullish Wall Street analysts had anticipated.
OK, Apple sold 8.7 million iPhones in the most recent quarter, but it also sold sold 21 million iPods. The company doesn't break out iPod Touch sales. But while iPod sales are declining, iPod Touch sales are up. At the end of the last quarter there were almost 60 million iPhone OS devices around the globe (including the iPod Touch). Morgan Stanley estimated the number at 57 million in early December.
So let's assume that 5 million of those 21 million iPods are iPod Touch devices. That would put the combined sales of the iPhone OS units at more than 70 million today. So the iPhone OS (not the iPhone itself) has already beaten the IDC Android unit sales projections for 2013.
What happens tomorrow with the iPhone is important for the future success of the platform in the US market. Regardless of whether there's a new iPhone OS or 4G device, if Apple announces that AT&T exclusivity is through and that the handset will be available from Verizon and/or others, we're likely to see Android momentum falter. If not, Android will continue to gain steam.
Apple executives made some comments yesterday, however, that suggested AT&T exclusivity may not be done. They expressed confidence in AT&T and its ability to "fix" network problems that have frustrated and infuriated iPhone users. That kind of remark doesn't sound like one from a company about to walk away from its exclusive relationship with AT&T. But we'll see.
If Apple fails to "cut the chord" tomorrow and broaden iPhone distribution in the US it will cede millions of users to Android. I would be happy using the Nexus One rather than switching to AT&T, with its network's mortally wounded reputation, to get the iPhone (I have an iPod Touch). And while it's not as intuitive or "elegant" as the iPhone, and the apps are not as polished, the N1 generally substitutes. Its speed and screen are better than the current iPhone as well. And the voice-text input features are compelling.
Apple may not see this timing issue as critical. It will exit AT&T exclusivity at some point. If it does so now, it will establish itself on a trajectory to become the dominant smartphone in the US market and Android's rise will be blunted (though perhaps not RIM's, the current market leader). If it waits for 2011, US iPhone prospects will likely have moved on or set their sites on other handsets. All the defectors that are going to head to AT&T for the iPhone have already done so.
As suggested, RIM is a wild card in this discussion and so is Windows Mobile, which is declining now but could get a big boost from WinMo 7. Nokia, regardless of Symbian UI upgrades, will continue to lose share in the US and Europe in the coming 12-18 months. It will remain strong in Asia, Latin America and Africa -- emerging markets that seek lower-cost handsets. Palm, I'm afraid, will be largely an also-ran in this race.
The market for smartphones, however, is very much evolving and in flux. What happens tomorrow (from Apple) could be very significant for both the iPhone and for Android's future in the US. It might be that Apple makes the wrong choice, falters and Android benefits. The thinking that Android will automatically grow to be the world's number two, however, is simplistic.
The release is just out, here are the numbers:
Listen in on the earnings webcast at 5 Eastern if you're hungry for more.
Selected bits from the call:
There have been many rumors and articles in the past several months about Apple courting "old media" for its tablet launch. The Wall Street Journal devotes much of its article from yesterday on the forthcoming Apple tablet to the topic:
Apple has recently been in discussions with book, magazine and newspaper publishers about how they can work together. The company has talked withCo., Condé Nast Publications Inc. and HarperCollins Publishers and its owner , which also owns The Wall Street Journal, over content for the tablet, say people familiar with the talks.
New York Times Chairman Arthur Sulzberger declined to comment in an interview Wednesday on its involvement in the new device except to say, "stay tuned."
Apple is also negotiating with television networks such as
Apple pitched media companies on a "best of TV" subscription service to television networks under which customers would pay a monthly fee for on-demand access to programs from a bundle of participating TV networks, giving consumers another way to readily access television content.
Clearly people are buying books and newspapers via the Kindle. But Apple may be uniquely positioned to pull off this pay model because of the "culture" of paid apps for the iPhone and its iTunes payment platform. It may be the case that out of the gate to get specialized, formatted content on the tablet you'll have to pay.
However, undoubtedly there will be a Safari browser. And with an Internet connection many people might navigate around the pay wall to the desired publisher's free Internet site. As the anticipation builds toward launch, how can the company possibly live up to the hype?
We'll see next week. But in the meantime, here's a scenario to consider . . .
Are people going to have an iPhone or other smartphone, a laptop (with a dongle) and now a tablet (with a plan)? That's a lot to ask and probably closing in on $300 in monthly connectivity fees. That's not counting the home ISP charges starting at $30 per month at the low end.
But let's say that Verizon or other carriers offer a reasonable subsidy, bringing the device down to under $500 with a two-year contract. An all-you-can-eat data plan or MiFi hotspot (as an alternative) might run $40 per month. What if this tablet could truly be a netbook substitute (with a dock and USB keyboard) as well as have a gallery of apps like the iPhone. That would be pretty interesting.
You could potentially do VoIP calling (Skype, Truphone, Vonage, Google) and entirely ditch the carrier voice plan. Most people won't pursue this, but it's quite possible. This also argues for a time in the next three years where people are only interested in a fast data connection and are less and less willing to pay for voice . . .
Here is a roundup some of the latest speculation:
Next week Apple is launching its much anticipated tablet/media pad device. There is much speculation that the device is coming to Verizon and that it may cost $800 "unlocked" and roughly $600 with a two-year service agreement. That price is going to be high for most people. By contrast, the basic Kindle is about $250 and the DX (larger format) is about $500.
The eReader market is getting more competitive by the day. The Apple device is going to be much more than an eReader, however. It allegedly will have a docking station or capability and the option to plug in a keyboard; so it may double as a netbook alternative. But the pricing of the device will be largely determinative of how successful it is. Kindle's $250 price will help it survive vs. $600 or $800 for the Apple tablet.
In September of last year there was discussion and speculation about whether Kindle would open up (a la the iPhone) to third party developers. At the time we said:
Yet, to succeed long term, opening up and building an ecosystem like what the iPhone has done is precisely what Kindle must do . . .
Apple's forthcoming tablet will likely be compatible with iTunes and iPhone apps and provide most of the eReader functionality that Kindle has. It will be expensive, relatively speaking, but Apple's brand strength can support a higher priced media tablet, provided the functionality is there. Amazon is thus likely to confront a host of competitors with color screens and broader capabilities on the one side and cheaper models on the other.
Now Amazon has done just this and introduced an SDK:
Today, Amazon announced that it is inviting software developers to build and upload active content that will be available in the Kindle Store later this year. The new Kindle Development Kit gives developers access to programming interfaces, tools and documentation to build active content for Kindle--the #1 bestselling, most wished for, and most gifted product across all categories on Amazon. Developers can learn more about the Kindle Development Kit today at http://www.amazon.com/kdk/ and sign up to be notified when the limited beta starts next month.
This is the only direction for Kindle to go to make itself more broadly useful and ensure its survival. It now becomes, potentially, a competitor to the iPod Touch. There's speculation that Amazon has sold roughly 1.5 million Kindles to date. That compares with 70 million (roughly) iPhone OS devices around the world. Still a million devices is enough to get many developers interested.
If they bite and we see a rich ecosystem of apps (need a color screen too) then Kindle becomes much more useful. Kindle can survive the Apple challenge by being more broadly useful, offering a color screen and being cheaper. On the other side of the fence, it can survive the challenge of Nook and others by developing an apps ecosystem.
Apple has historically said that the company can't really sell a full-blown computer for less than $500. That's disappointing because if it really wants to push its tablet into the mainstream it would price it around that level or just above, with a carrier subsidy taking the price down to $300. But then you'd have iPod Touch cannibalization.
Apple sees the device serving a wide range of goals, presumably to justify the higher price point. But if Kindle's SDK strategy succeeds it may ultimately put pressure on Apple to lower the price of the iPad or whatever it turns out to be.
Related: Retrevo survey on most desired features/content for Apple Tablet.
Consulting firm Deloitte contends that ''NetTabs will be purchased by tens of millions of people in 2010." NetTab is an awkward term coined by the firm to refer to the emerging category or tablet or slate computers.
In September last year electronics shopping site Retrevo published the results of a US survey (n=771) that asked about eReader buying intentions:
Planning to buy an eReader this year?
What brand are you going to buy?
The Kindle and Sony devices are not Internet access devices at this point. Many new tablets/readers (including the Nook) have been introduced since this survey was conducted. However it's not clear to me that what Deloitte is arguing will come to pass. Much remains to be seen, including whether the Apple Tablet can be a mainstream device and "market maker."
Tablet computers have actually been around for a long time but failed to catch on. The new category of "bigger than a smartphone, more convenient than a netbook or laptop" is what we're talking about here. So far, however, none of the devices introduced are all that exciting (other than the pure eReaders like Kindle). Accordingly there's no indication that the category that Deloitte is talking about will take off -- at the moment.
It's almost impossible for Apple to deliver a tablet device that lives up to the intense hype that has been more than a year in the making. But at the end of the month in San Francisco the heavily anticipated tablet computer, eReader and media player will likely be revealed. Will it dazzle everyone and usher in a new era of mobile Internet devices that sit between smartphones and netbooks/laptops? Or will it disappoint by offering features too common among all the tablets and slate devices emerging in the market?
What about the price?
The "sweet spot" for the device is more than the $399 64G iPod Touch, but less than the $999 macbook laptop. That would put it between $600 and $700 dollars. There might be a lower-end and higher-end device to create an entry level price point around $500.
Whatever turns up there will be lust for the device among Apple's core fans. However, pricing will determine how mainstream it becomes. Recall that the iPhone didn't take off until the AT&T subsidy brought it down to under $200. Speaking of which, what of connectivity and carrier subsidies? Might we see the same thing: a low price point on the hardware with a two-year contract (e.g., on Verizon)?
We'll see . . . Regardless, the waiting will finally be at an end.
Last month Mediamark released survey data on kids with mobile devices as well as demographic data on the 2.1 million owners of eReader devices in the US. Mobile phones are now deeply penetrated in the tween segment and eReaders are for the affluent according to the data, which follow.
First kids and mobile devices . . .
The data come from the company's "2009 American Kids Study, with approximately 5,000 participants from households included in the Survey of the American Consumer." Here were the top activities among kids on their mobile phones:
Mediamark says there are approximately 2.1 million US adults who own eReaders. The firm said that owners are "more likely than the average adult to be well-educated and have high incomes . . .They are also far more likely to be heavy Internet users." This of course makes sense, given that these are largely luxuries or "frivilous" devices right now.
Percent More Likely Than Average U.S. Adult to….
According to Mediamark:
At 56.3% of e-reader users, men outnumber women (43.7%). Adults ages 35-54 are the “sweet spot” for this product, as they are 20% more likely than the average adult to own an e-reader.
These data from from MRI's Fall 2009 Survey of the American Consumer, which is based on 26,000 interviews of US adults.
One of the amazing things about CES is the number of tablets and eReaders that were announced or showed up before and during the event. It's almost difficult to keep track of them all. In addition to Kindle, Nook and Alex, there is now Skiff, QUE, HP tablets (Windows, Android), Lenovo, Gii Nii, Dell, Camangi Webstation-- and on and on.
BusinessWeek covers the segment asking the question which ones will be around a year from now? And of course there's the highly anticipated Apple tablet, allegedly coming at the end of this month.
Consumers have failed to adopt tablets in the past but with the success of the iPod Touch (in particular) and Kindle the market has been conditioned for these devices. As with animal species that didn't survive evolutionary pressures many of these tablets will die off. Perhaps a better analogy is the MP3 market. After iPod there were only a few competitors that had any share at all.
If the pricing rumors about Apple's Tablet are correct and it's up near $800 or $1000, however, it may not become a truly mainstream device. But the anticipated full functionality (color screen, media player, lots of RAM, WiFi-enabled, Internet browser) that it will offer will become the standard for one surviving line of these devices. Another surviving group may be lower priced eReaders focused primarily on reading without the color screens and media player capabilities. At a sub $300 price point we may seem them flourish and there may be two or three devices that succeed here.
There will be a shakeout, probably after Xmas this year that will see a few tablets and eReaders emerge as winners and others fade into obscurity. Yet netbook tablet substitutes that do nothing elegant with the form factor will likely fail because they will simply be seen as less-functional alternatives. One of the interesting things to see will be how Apple solves the keyboard issue for this larger iPod Touch.
Another question: will the Web-enabled versions of these devices be more analogous to the PC or to smartphones, with accompanying widgets and apps? Some of the Android tablets will offer Android marketplace apps. The rumored Apple Tablet is supposed to have a developer SDK; does this mean a new category of apps? That would seem foolish on Apple's part.
In addition, most or many of the WiFi-enabled devices will become phones with Skype, Vonage, Truphone or Google Voice. So the success of tablets may also be a boon for these VoIP companies.
The Consumer Electronics Show opens tonight in Las Vegas and there are a ton of announcements coming out of the show already. Mostly they surround three areas: eReaders/Tablets/Slate computers, 3D TV and mobile TV. Here are just a few of the announcements and related coverage so far:
The Samsung Moment is offering free TV via the new mobile DTV standard. Free TV will be of interest to most people who would like to watch TV on mobile devices.
But the persistent question surrounding the so-far unsuccessful mobile TV efforts in the US and abroad is how to get consumers to pay. Then there are the "TV Everywhere" efforts of TimeWarner, Dish Network and Comcast to provide access online and in some cases via mobile devices to subscribers. This extends the "reach" of their subscriptions to other devices.
Although paid offerings have not been very successful to date, a recent survey shows an apparent, growing willingness to pay for premium TV and video content on smartphones. However other surveys show price sensitivity:
Source: QuickPlay Media, n=1,000 (3/09)
There will ultimately probably be three or four "mobile TV" business models in the market:
The idea of a monthly fee for a stand-alone mobile TV subscription, however, is likely to fail (as it has to date).
Although I love the idea of all the tablets and eReaders coming out, their success is still something of a surprise to me. Why? Because, unlike a smartphone, it's a fundamentally "frivolous" purchase for all but a handful of voracious readers who don't want to lug a bag of books with them on planes.
The Kindle was the top selling electronics item of the holiday season on that site. And the day after Xmas, Amazon announced, "On Christmas Day, for the First Time Ever, Customers Purchased More Kindle Books Than Physical Books." Barnes & Noble's competing device, Nook, has also sold very well.
There are easily more than a dozen tablets and eReaders either out or coming out. The most anticipated of which is the unconfirmed Apple iPad/iSlate/iGuide, which is expected to be announced at the end of next month.
Most of the existing eBook Readers rely on E-Ink (Kindle, Sony, Nook). While utilitarian, this makes for a bland user experience. Now a new eBook "platform" called Blio, from Ray Kurzweil, brings rich graphics and full color to eBooks. It's not hardware but software that works with multiple devices. In more ways than one, I believe this is clearly the future and the existing E-Ink readers will in retrospect be seen as "1.0" devices.
Magazine publishers, which rely on rich visual material in their publications, are gearing up for a tablet-centric future. Many have them have already embraced the iPhone, a full-color device. Newspapers too will want full color. And in both cases they'll want to incorporate video (eventually).
I'm sure that Apple recognizes the importance of color and will offer it as part of the Apple tablet experience. I suspect that WiFi and Web browsing will also be included (perhaps a media player as well). My belief has long been that the winning device(s) will offer a large or full-size color screen, WiFi and full Web browsing and video capability. Alternatively, a range of devices can co-exist with these uber-tablets if they're relatively inexpensive.
While we have Amazon to thank for jumpstarting this market, absent some changes, it's unlikely that next year at this time Kindle will be in the same privileged position it is today.
Take every forecast not as gospel but as indicating the direction the market is heading. Look at multiple forecasts for consensus. Forecasting is something of a game. Healthy skepticism is required, even for the stuff we do.
Here are some wide ranging device and Internet access projections from IDC:
Nothing much to be said other than: "growth, yes."
The big deal, which was highlighted by Google's Vic Gundotra the other day, is that "we're at the beginning of the beginning" of a new era of computing. It's really pretty clear that mobile devices, ubiquitous connectivity (which is coming) and data in the cloud are going to make computing and mobile Internet-based computing look very different in a few years than they do today.
We'll be saying over drinks, "Remember when you had to sit at a terminal with an Ethernet cable plugged in to get online . . . "
As I've said many times, I'm fascinated by the "two-device scenario": one mobile device for calling and one for Internet. The myriad eReaders now emerging promise to evolve into full-blown Internet devices in the near future but the CrunchPad (now called JooJoo) is a Internet-centric tablet that could potentially double as an eReader -- the other way around, in other words.
Any Apple Tablet is sure to be Internet-centric and WiFi enabled as well.
The JooJoo device (supposed to launch on Friday) may never make it to market because of a looming lawsuit with TechCrunch, the company that originally developed it. The device is also overpriced at $500, which will keep people away.
The right price point is less than $300. At $500 people will compare it to a laptop rather than an iPhone or iPod Touch. However it points the way to a broader range of connected mobile devices that are not phones.
Photo credit: CNET
On this device, the Internet is the Internet -- not a shruken-down mobilized version. See CNET's "hands on" review.