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Year End Wrap Up-The Tablet Wars

• 16/12/11
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It seems like only yesterday I was talking about tablets in my January 2011 Digital Delirium’s newsletter. Where did the year go?

I want to look back at my predictions for tables and see if I was at all correct in what I said.

Last January I said that Apple would be facing some stiff competition in the tablet market place. Android hosted a lot of tablets from leading software and hardware providers. Samsung came out with the highly priced Galaxy, HP had its Touchpad with it great webOS operating system and BlackBerry introduced its powerful PlayBook. I really thought the HP tablet would be a possible big player in the 2011 tablet market. In a way I was right, but not in the way I had predicted. The HP was a dud, until its price dropped; it sold out in one day!

Yes, the Apple iPad seemed to be facing a lot of really hot competition in 2011. Would Apple keep its leadership of this market place with all this competition coming in 2011? Well with the launch of the iPad 2, Apple showed leadership in a big way. How did they do this?

I personally feel that price has been an important element for most of the competition. All were overpriced for what they offered. You can clearly see this with the HP Touchpad. I think this was one of the biggest losers of the 2011 tablet wars. It was overpriced and over hyped.

I don’t think anybody in the technology industry can really logically explain what HP thought it was doing with this seemingly winning tablet Yes, the first generation was underpowered and it did not offer that many useful apps. However, I think it really had the possibility of becoming a major player had it taken more time to develop what the consumers wanted.

I think the leadership of HP, if you can really call it leadership, could see the writing on the wall, with all of the Android tablets flooding the market. They may of thought all these new tablets would take all the oxygen out of the Touchpad. It seems, instead of developing a really good product, they gave up and practically gave the remaining stock away for $99.00

You could clearly see that with a bit more development from HP they could have had a winner on their hands. Then out of the blue we get the public statement from HP that they were going to get out of hardware business and by the way we going to kill off the Touchpad. Yes we know that only a short time ago we bought Palm for $1.2 billions but we give up. This is like the Catholic Church saying that it was planning to get out of religion.

Yes this is the shocking Alice’s Adventures in Wonderland world of corporate America at the present moment.

Then we have similar madness of the BlackBerry PlayBook, with the crazy starting price of $699.00. You’ve got to wonder what the board of BackBerry was smoking?

It really didn’t have any real applications apart from the built in apps by BlackBerry and BlackBerry really didn’t seem to have any plan of action on how it was going to get the independent table development community on board to make any useful apps for its PlayBook in the foreseeable future.

This led to the launch of the PlayBook for BlackBerry, in pure financial terms, a disaster, with them recently stating a $485 million write down of its inventory.  

We saw a flood of Android tablets on the market at the beginning of the year, unfortunately most of these tablets were running old versions of Android which was not originally designed for tablets. It took much longer than expected for Google and its hardware partners to get its new Android Honeycomb to the market place this year. This, in my opinion has really affected the Android hardware sells in 2011.

What all this has done is made Apple very happy in 2011. They are selling millions of iPads and the competition still hasn’t really managed to effectively grab any of the market shares from them. However, in 2012 this might change!

One of the reasons why I can say this, with a straight face, is because of what happened to the HP Touchpad after HP announced that it was going to do a fire sale of all it tables. The Touchpad just flew out of HP’s warehouses at highly discounted prices.

What I think this clearly shows is that the general market for tablets is very price sensitive. Most consumers are willing to buy tablets, as long as the price is low. What this indicates to me is that there is a pent-up demand for inexpensive but effective tablets.

I think we are seeing the first of these coming to the market with the launch of the Amazon Fire at the reasonable price of $199.00. Yes it has limited functionality but does have some strong points, like free cloud storage of the content you buy from Amazon and it has a powerful dual-core processor.

Barns and Noble may also be a major player with its Nook tablet. It is priced a little higher than the Fire at $249.00, but it offers consumers more choices, like book sharing and better customer support. 

2012 may well be the year of the sensibly priced tablet.

I wish you all a very Merry Christmas and Happy New Year.

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