Apple Tablet: It's The Ecosystem, Stupid
Codex, headquartered in London, is also affiliated with Oh's Boston-based Tech Superpowers, a long-standing Apple reseller partner. The white paper seeks to debunk "Apple Tablet Myths" while acknowledging the market challenges faced by the highly anticipated multi-touch tablet device that Cupertino, Calif.-based Apple is expected to announce at a press event in San Francisco this Wednesday.
"The predominant belief is that Apple's Tablet will succeed simply due to the popularity of the iPhone and the incredible buzz around the product. Conversely, a significant minority of analysts believe the tablet is merely a product of overhyped PR and, with a lack of useful applications, will soon fail," Bartfeld and Oh write.
But both of those "myths" are inaccurate, the Codex Development co-founders conclude.
The paper starts with a brief history lesson on the Newton, the PDA that was "ultimately killed by Steve Jobs upon his return to Apple." The Newton, the authors conclude, was a product line that bit off more than the technology of the time was able to chew, with the handwriting recognition in particular being "widely ridiculed in the popular press."
"[W]ith no suitable application which clearly benefited from freehand notation, there was simply no clear reason why people should have bought a Newton," write Bartfeld and Oh. In the years that followed the Newton, assorted companies built tablet PCs with limited success and today's market share for tablets in the overall market for computing devices hovers at just 1 percent.
Not exactly an encouraging sign for any new tablet, even one by mighty Apple, the company with the golden touch. Which is why Apple won't be selling an iTablet or iSlate or whatever the new device is called, Bartfeld and Oh conclude, so much as it will be selling a new ecosystem of distributors and developers that happens to use a tablet device as "the last few feet of a pipeline of digital content delivery."
Confused? Bartfeld and Oh contend that there is fundamental misperception about Apple's great successes of the early 21st century -- the iPod and iPhone. On the surface, it seemed like the company simply developed, delivered and sold a pair of wildly successful devices. But it was so much more than that, they argue.
"In both cases, Apple realized that the device wasn't the end product," the paper states. And in fact, Bartfeld and Oh write, when they were first released, the iPod and iPhone presented an actual step back in certain areas of utility when compared to the respective MP3 players and smart phones those two Apple products were stacked up against. For example, the iPhone removed the smart phone's traditional keypad while both it and the iPod "allow[ed] for little customization, especially compared to what 'knobs and dials' are available on most desktop systems."
"It's not that Apple is philosophically opposed to customization or open platforms," they write. "... Rather, Apple recognizes that when a device like the iPod or iPhone is part of a consumer ecosystem, it must serve that primary purpose to a level of perfection, even to the detriment of flexibility."
In other words, the usefulness of the iPod as a delivery system for iTunes and the iPhone for the App Store is at least as important to those products' success as their attractiveness as stand-alone devices. Perhaps they are just the public-facing cogs in a massive content delivery apparatus -- where the medium ends and the message begins, nobody can say for sure.
Next: Netbook 2.0? This is not a particularly novel observation about the iPod or the iPhone -- or about the similarly positioned Amazon Kindle, which Bartfeld and Oh also reference as a comparable device-ecosystem symbiosis that the Apple tablet would do well to emulate.
The really interesting part of the paper is the authors' recipe for Apple to make such a runaway market for its tablet, and their judgment as to whether the visionary computer maker can pull it off. Bartfeld and Oh cite several main areas where Apple will want to concentrate on "sowing the seeds of the tablet ecosystem," often naming relevant, existing product categories that show how that might be done.
The first area of interest is the utility of the device itself and the relevant product is the netbook. The authors claim that one mistake made by makers of tablets in the past has been to assume that ultra-portability is hugely important to would-be users of their devices. Not true, say Bartfeld and Oh, citing a fall-off in sales of so-called ultra-mobile personal computers (UMPCs) in recent times. Besides, they contend, netbooks have the portability market cornered and are priced far lower than would be possible with a touchscreen device like a tablet.
Instead, a tablet should be conceived of as a "Netbook 2.0," aimed at those netbook users who are "finding that as they become more digitally savvy the netbook is simply too limited." One way to do give such a user more of what they crave, the authors suggest, is to make a dual-purpose device that in addition to being a tablet, could be used as a traditional, upright laptop display via Bluetooth keyboard support.
The next suggestion from the authors concerns a tablet's potential appeal not to users, but to content producers. And specifically to those who are finding e-books like the Kindle to be limited platforms for attaching their most lucrative advertising packages to content. What does a tablet do that, so far, e-books simply can't? Give advertisers the color displays that they're willing to pay more to show up on.
Other broad subjects the authors touch on include social media-driven interface opportunities for developers of advance touch- and gesture-based editing tools for the likes of Facebook, as well as possibilities arising from the push towards "Minority Report"-type "fantasy interfaces" for multi-touch computing.
The upshot is that Apple -- through its chain of retail stores, online content and application distribution properties, enviable developer network, and strengths in both product development and support -- is "well positioned" to make an Apple tablet "the next big thing in technology."
Sounds promising, but the authors do offer a word of warning to Apple -- watch out for Google. Bartfeld and Oh peg the Mountain View, Calif.-based search giant as "the only company that can compete" with Apple on a tablet, one that would likely evolve from Google's Android platform for smart phones like the recently launched Nexus One.
"Just as Android is doing its best to form a duopoly in the smart phone market, it will eventually be the main competitor to Apple for the tablet," they write.
Unfortunately, Bartfeld and Oh say nothing about Apple's potential strategy for telecom partnerships with regards to its tablet. Specifically, would it be wise for Apple to reprise its exclusive iPhone deal with AT&T in the U.S. market? Could it instead go with Verizon, the carrier that is currently slaughtering AT&T (and indirectly, the iPhone) with an ad campaign mocking the latter company's 3G network coverage?
Or will Apple do what one assumes the majority of potential tablet buyers would prefer and offer up a choice of carriers? The answer awaits in approximately 24 hours.