The Growth of the Tablet PC IndustryIn 2012, the NPD Group, a leading market research firm in North America, forecasted that tablets are poised to overtake notebooks by 2016, with tablet sales expected to grow to more than 809 million in 2017 from only 347 million in 2012.
Microsoft also predicted that tablets will soon overtake traditional desktop personal computers. The company's vice president for Windows Web Services, Antoine Leblond, predicts that this will occur by 2013. This after PC sales have remained relatively flat for the past few years.
Tablets started gathering steam with the introduction of Apple's iPad in 2010. In just 12 months, more than 15 million units were sold, sales levels that shocked just about every analyst and tech blogger, and blew first year predictions of 4 to 5 million units right out of the water. It was also impressive enough to cause all the other PC, mobile phone and electronics manufacturers to drop what they were doing and start making tablets in an effort to get a share in the market.
PriceWaterhouseCoopers reported that in 2010, there were already about 30 tablets competing with the iPad. By 2012, that number was closer to 100.
PWC also said that the reason a lot of manufacturers were getting into tablet production is that they simply had no choice. With a growth rate of five times the growth rate for PCs and four times that of smartphones, tablet PCs are where the money is. They also represent a unique opportunity to corner both the smartphone and PC markets.
Why Some Tablets FailThe wild success of the iPad led to the assumption that consumers wanted tablets. However, what may be more true - at least at the time - is that consumers wanted an iPad. It certainly helps to explain why so many other table makers failed. The HP TouchPad, for example, was on sale for about a month before the iPad debuted. It was discontinued in less than two months, and is considered one of the biggest tech flops of 2011.
Why such a highly anticipated product failed so miserably has been debated all over the blogosphere, but most critics agree it was a combination of failed marketing and a price that was too high for a tablet that had fewer features compared to the iPad and other competitors. Oh, and it only had 6,000 apps, compared to the hundreds of thousands of apps available in the Apple App Store and Android Marketplace.
Speaking of a lack of apps, you just have to bring up Research In Motion's (RIM) PlayBook. When RIM launched PlayBook, it did not even have an app for Twitter, Facebook or, god help us, "Angry Birds". Nor did it support email, contacts and calendar apps. People didn't like the fact that they couldn't pull the PlayBook out of its box and start playing with it, and it didn't sell.
Dell's Streak 7, on the other hand, ran on Android, with dual core processing, 4G compatibility, Flash support and both front and rear cameras. It seemed promising - especially at its low $200 price point. But it was a flop, too. Users complained of software glitches and a low-quality display. Clearly, the company worked too hard on making Streak affordable, and forgot about usability.
Motorola Xoom held a lot of promise as well. It was powered by Google's Honeycomb OS, and had 4G LTE connectivity. Motorola called it the "iPad killer." It proved be a very lame assassination attempt for one simple reason: The 4G LTE connectivity wasn't available in the off-the-shelf product, which meant that users had to mail their tablets back for an upgrade. That didn't exactly say "cool" or "high tech." But what really killed the so-called "iPad killer" before it even bared its teeth was the price of the thing. No one wanted to pay $800 for what was essentially an iPad alternative when the iPad itself was selling for $499. The result? Xoom did not even ship enough units in the first quarter to make 10 percent of iPad's quarterly sales of 10 million units. (Learn about some other tech company failures in 4 Top Tech Companies that Failed, Survived (and Even Thrived).)
What Consumers WantCan these early tablet failures serve as a lesson to manufacturers? We think so. Here are a few things we hope they've learned.
- Consumers Want a More Affordable Tablet
The iPad is the industry leader and if Apple can give its customers a tablet for less than $500, there's no reason why other tablets can't compete at a lower price point. Case in point is Amazon’s Kindle, which sells for $199. It may not have the full functionality of the iPad, but it is a resounding success as far as price is concerned because it presents an affordable alternative - and one with good features and functionality.
- Consumers Want a Better Tablet Experience
Tablets sell because they are portable and mobile. Tablets that deliver a frustrating experience are missing the point, no matter how cheap they are. Some companies also seem to overlook how consumers will use the product. Watching movies and listening to music are key activities - that means a high-quality display and good sound quality are deal breakers.
- Consumers Want Tablets that Respect the Tablet Ecosystem
Tablets are basically useless without good apps. That means that the quality and availability of apps will dictate a tablet's success. No apps, no loyal customers.
It seems that some early tablet PC manufacturers assumed that size is everything. Consumers quickly proved them wrong. They didn't just want a small device, they wanted one that still packed a big punch in terms of functionality - and fun. As for pricing, well, it's hard not to feel sorry for companies who tried to capitalize on iPad envy. But while many consumers were willing to make some trade offs to get a cheaper tablet, most of these low-end competitors failed to capture the spirit of their higher-end competitors; they were slow, clunky and they didn't even pretend to be cool. However, as the tablet market continues to heat up, someone's bound to get it right, eventually. And with all the companies jumping on board, it may not even be Apple.