Is Apple Really Working On A Tablet?

The collective disappointment about the lack of an Apple tablet as “just one more thing” was amusing to see, but honestly, how much of a surprise should this have been? The continuing evolution of the iPod meant that something was getting a camera (just not the iPod everyone figured would get it). The updates to the iTunes store interface are certainly welcome. The absence of a tablet was certainly not that much of a surprise.

But is Apple actually working on a tablet, and not some answer to the netbook phenomenon? If they are working on a tablet, will it be a MacOS or iPhone OS based machine? They could be working on a tablet, or they could just be working on an ultraportable MacBook with a touch-sensitive screen (possibly along the lines of the convertible Windows tablets that exist today). My instinct says that a netbook is the more likely choice, but one with a touchscreen of some kind.

Is it a Tablet?

If they really are working on a tablet, I don’t see it being much bigger than a 10″ unit, possibly smaller. Much larger and it becomes a bit awkward to handle (even though 10-12″ would make a better viewing size more akin to the size of a conventional magazine). It would need to be larger “enough” than the iPod Touch/iPhone to differentiate it, but not so big as to be unwieldy.

Even if it is a pure tablet, I would be surprised if it is using the iPhone OS. Making it the same operating system as the iPhone doesn’t automatically open up all of the iPhone/Touch apps to the device, given that the sizes are radically different, and the various apps are largely built around the assumption about the current iPhone screen size (whether they should be or not). If the tablet’s dimensions are some multiple of an iPhone/Touch screen, then I could see several apps laid out like playing cards, tiled to run beside each other. The alternative would be for each app to run in its own free-floating window, which would be fixed in size to the same dimensions of the iPhone/Touch screen. I’m not sure that the iPhone OS would make the most sense at this time.

I’m just not convinced that, right now, there is a market for a tablet. The tablets offered on the Windows side of the world have done very poorly outside of specific vertical markets, and Apple has done better by being later to an robust market, than trying to ignite stagnant ones. The one time they tried a stagnant market has met with poor results, specifically the AppleTV: the home media PC market simply hasn’t materialized the way it was “supposed to”, but Apple tried to enter it anyway. MP3 players were starting to get popular when the iPod hit the market, and took off like a rocket. The MacBook, iMac and PowerMac have all simply been alternatives or attempts at improvements on an existing market. The iPhone was introduced into a market where smart phones were proven. I believe that the tablet market today is small and stagnant, not because of pent-up demand for a better product, but simply because no one wants them right now. People already wanted MP3 players when the iPod came out. The iPod merely made it more compelling. People already wanted smart phones when the iPhone came out. The iPhone, again, was perceived as “better”, and consumers have responded accordingly. Most consumers don’t seem to want a tablet.

Is it an Ultralight/Netbook?

I think this may be the more likely case. Apple already got their feet wet with ultrathin machines with the MacBook Air. The other physical dimensions of the Air, as well as a the price, put it outside of netbook territory. It also seems that Apple executives have spent more effort putting down existing netbooks, and the market they are in, than they have on other product areas. Apple’s modus operandi has been to start by running down a market segment, and then “save” it by introducing something better (real or perceived). Other than some limited remarks about the Kindle, Apple has been a bit more vocal on netbooks than on tablets or tablet-like machines.

A ultralight, ultrasmall MacBook with modest CPU, memory and storage, but boasting a touch-screen, could have a better chance at short and medium-term success. The form factor will be familiar. The expectations for such a device not as high when compared to regular-sized notebooks. Having the ability to convert it to a tablet and having a multitouch screen could be compelling to consumers.

Pricing will be key though. While Apple products are generally competitive, or at least not outrageous, in their own markets, the netbook segment appears to be the most price sensitive. Apple might get away with charging $50-$150 more for their product relative to the other machines that are out there. Much higher and people will either ignore it, or compare it to higher priced machines that will be more functional and more powerful.

The advantage of this approach is that it builds on technology that is fairly well understood. The only “new” element is a larger-sized touchscreen that isn’t pen-based. Even this isn’t new, because Apple has experience in this area with the iPhone and iPod Touch (albeit with smaller screens), and other manufacturers like HP have desktop computers with larger touch-sensitive screens today. The laptop parts, however, are well known. Apple has already had to deal with heat, power and feature issues in limited spaces with the MacBook Air. A laptop arrangement allows them to go head-to-head with the existing netbooks in a form that most people are familiar with, but adds the ability to make the machine easier to use by allowing it to be a tablet when it needs to.

I would also expect that this device will be based on MacOS, again simply because it is familiar ground. As an operating system, it isn’t very resource intensive, certainly not when compared to the high-end operating systems that it is analogous to (Windows XP Pro, Windows Vista Business/Ultimate, Windows 7 Professional/Ultimate). It has a reasonable selection of 3rd party software. Besides, the device will probably support running some version of Windows as well, so if someone needs to use Windows software, but wants the Apple hardware, that would still be an option.

Lessons From the iPod

Apple has already tested the waters of a tablet-like-device-as-netbook in a limited way, trying to position the iPod Touch as also being a netbook. The response was a decidedly lukewarm reaction. I think it would be easier to position an ultraportable MacBook as a netbook, because it would simply be Apple’s take on the segment, much like the original iPod was.

When the iPod was introduced, companies like Creative and iRiver had feature-laden offerings with significant storage and reasonable prices. The first iPod was more expensive, didn’t have quite as much storage, and lacked features like FM radios. The form factor was similar to the hard-drive based MP3 players at the time, being your basic box about the size of a deck of playing cards. If features and price were the governing factors, there is no way the iPod should have been able to dominate the market. Instead, the iPod did a few things differently. First, it was typically easier to use. The interface was simple, but still functional without feeling crippled. But it was more than that: the iPod was nice to use. People told other people this, and between word-of-mouth and a slick print and TV campaign, a device that came with a premium price and a dearth of features dominated the market. Adding the iTunes store behind it simply put the iPod in a league of its own, and it became the device that many other manufacturers now try to emulate and follow.

The netbook market is, in many ways, much like the MP3 player market was at the time the iPod came out. MP3 players were already on their 2nd or 3rd generation when the iPod (compatible with the PC) hit the market. Netbooks today are on their 2nd and 3rd generation, depending on the manufacturer. Unlike MP3 players, though, the software that drives them is either a variant of Linux or Microsoft: the software and interface isn’t exclusive to the manufacturer of the machine. However, there is a proven market and one that appears to have legs.

Lessons from AppleTV

The other end of the spectrum is the AppleTV. So far, this product has been a disappointment. A lot of that seems to stem from the fact that there wasn’t a growing and exciting market for the device when it came out. Home theater PC’s and their ilk simply have not been adopted by the mainstream consumer, and are largely relegated to a very small market of enthusiasts. HP tried and failed with a media center PC. Microsoft has been pushing the media center concept for many years now. Apple’s entry into this segment did nothing to kick start the market, or create significant new demand in this product space.

Still Not Enough Data

As always, working from rumors and speculation means there is a distinct lack of hard evidence to support either guess :-). The 10″ and 12″ touchscreens that have been rumored to have been ordered in quantity could just as easily be put in some kind of netbook as in a tablet. The netbook market is hot now, and with little sign of slowing down. The tablet market, however, is generally slow, and the “pure tablet” without a keyboard or pointing device is virtually non-existent in the consumer space. I don’t see a new tablet changing this, much like the AppleTV didn’t do anything to ignite the home theater PC market.

Apple is very good at taking an existing technology segment, and finding ways at making it easier to use, more functional or simply just better. The iPod was “better” in the minds of consumers because it was cool and easier to use, and it had the iTunes store behind it for content. The iPhone was easier for many people to use, and has a huge catalog of applications available via the App Store. The restrictions around contracts and network selection have not slowed the iPhone down. An Apple netbook would follow along the same lines: take a market segment that is robust and has a future, and put out a product that is similar enough that it is “part of the crowd” but different enough (and compelling enough) that people will pay more to have it.

I could very well be wrong, and Apple could introduce a tablet of some kind in the first quarter of 2010. They may even spring it on consumers right around Christmas. It just seems that the netbook market makes more sense at this time than a tablet does.