An interesting item came across my laptop from IHS iSuppli today. It's a release that suggests Apple's iPhone 4S is the biggest challenge to Apple's dominance in the tablet market:
"Shipments of the iPad line fell short of IHS estimates in the fourth quarter as many loyal Apple customers devoted their dollars to shiny new alternatives," said Rhoda Alexander, senior manager, tablet and monitor research for IHS. "However, the primary alternative wasn't the Kindle Fire -- which debuted to solid sales in the fourth quarter -- but Apple's own iPhone 4S smartphone. The rollout of the iPhone 4S in October generated intense competition for Apple purchasers’ disposable income, doing more to limit iPad shipment growth than competition from the Kindle Fire and other media tablets."
Maybe I'm just desperate to legitimize my attachment to my laptop, but this is a very interesting development. Apple is credited with creating demand for tablets by inventing the iPad. Although the iPhone wasn't the first smartphone developed, it has certainly given the cellphone market a run for its money. But now the iPhone isn't stealing share away from RIM, Nokia, or others... it's stealing it away from Apple.
According to IHS iSuppli, this is likely a momentary blip on the radar screen. Apple's iPad 3 is set to debut in Q2 and will include a number of features of the iPhone, including the Siri voice interface. The researcher also says the next iPad will feature a killer new display. Other reports have the next version scaled down in size, from the current 9.7-inch display to something closer to 8 inches. (See: Behind Apple's Alleged Move to Small Screens.)
Smart marketing strategy (and we all know Apple is smart) dictates that various flavors of the iPad and iPhone will continue to trickle out for some time. But I think sooner, rather than later, Apple, or Samsung, or somebody will introduce the PhonePad, the SmartPad, or some other creature. Then I won't have to agonize anymore about whether I should add a tablet to my device collection. I can skip right over the tablet to the next version of the phone... and continue to love my laptop.
I was at an event the other day, the guy next to me (a friend from work) went outside for a moment and left his tablet on the table... when suddenly the thing started to ring... "what? this is a tablet!". I tried to pick it up and let them know he was outside but I felt like an idiot holding that huge device next to my phone.
If disposable income is "limited", I hope consumers go with sanity and pick up other smartphones. Apple only cares about the profit it makes and about its way (not the highway). For example, iPhone uses proprietary connector for charging, does not support microSD card, does not allow battery to be replaced, offers a very small display (retina display is more gimmicky than really useful). The statement by which Steve Jobs said that consumers do not know how to hold a smartphone is ridiculous and bs. Therefore, iPhone offers little but cost consumers more to buy than the other smartphones (subsidy simply hides the actual pay-out). For example, the new Lumia900 from Nokia offer better values because it cost only $100 (after subsidy) and it has state-of-the-art, if not better, packaging and OS. In any case, any MediaTablet costing over $500 (including iPad) is simply over-valued. At practically $650 (including a cover and a dongle with USB connector/SD Card Reader), I can buy a reasonably thin (less than 1") and light (less than 4 lbs) notebook PC at less than or around $650. For many consumers, notebook PC offers much more than the touch+apps. In particular, for students who depend on their parents for financial, they should really think triple or quadriple times before using their parent's money or their own hard-earned (part-time work) money for iPad with limited capability. When I was a child, my parents always educate me: if it is a must and help your studies or become a better person, buy it even if it is expensive. I don't think that iPad fits this requirement. Insanity is what I feel of many people who buy iPhone and iPad!!
You have a good point - functionality is not the same. But as an earlier post pointed out, disposable income is not unlimited, so at least a portion of the consumer base is forced to make choices depending an which set of functions they need most.
@Dave: Sounds like a smart idea. Not sure how practical it would be. Nevertheless, integration of devices is something that companies are looking to do. I recently came across a tablet computer by Asus that has an attachable keyboard. After attaching the keyboard, the tablet becomes a Netbook. Seems like a very useful gadget to have. Check out the details here.
I'm not sure if iPad and iPhones are perfect substitutes to each other. Each have their own uses and a market of users to cater to. While a lot of features amongst them might be common, each have their own distinct uses. For instance, you can't make calls or send sms on iPads. Similarly, the large display of iPads allow users to compose documents and carry out other business functions that they may not be able to do so on iPhones. I'm not sure if I'd agree that iPhones is causing the demand for iPads to fall.
I suppose in these cash strapped times the Apple gadget lovers of this world might only want to splash on one new toy. If it is the Ipad2 or the new Iphone4 then the new kid on the block usually gets the nod. I see it is a normal cannibalization blip.
Apple should try and provide many more models or variants of iphone to keep moving ahead in the market. They have to do this atleast till they come out with another block buster product into the market. Sadly even I can't imagine what that one might be. Otherwide I feel the customers will definitely choose iphone or ipad based in their needs and i don't think there will be any one who is interested have both the devices.
This phenomenon is a by-product of Apples' domination in both IPad and IPhone arenas. When they debvelop the better mousetrap, there is no one else's lunch to eat but their own!
Readers: I can definitely see why a company playing in several verticals, such as the tablet, smartphone and PC markets, would continue to release products into each market. It is also in the companies' best interest to keep those markets viable. Aside from the legal implications of that, however, once tablets and phones converge, it means less hardware. So the competition will take place in a different arena--software, OS and patents--which has already started. That's at the OEM level, anyway.
As a consumer, the less hardware, the better. As a supply chain advocate, though, I can't root too enthusiastically for convergence, as net demand for components is likely to drop as well.
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Join EBN contributor Jennifer Baljko on Thursday August 23, 2012, at 11:00 a.m. EST for a live chat on how electronic manufacturers in Thailand have shored up their supply chain to reduce the impact of future natural disasters.
Peter Drucker famously said "Trying to predict the future is like trying to drive down a country road at night with no lights while looking out the back window." Yet in the razor's-edge world of electronics—with a lean supply chain and just-in-time demands—the need to know the future is vital.
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