Infinite Path

If you were to take a quick glance at some of this morning’s headlines, you could be forgiven for thinking that Apple had taken a firm grip on the computing market. “iPad chokes netbook sales”, and the catchy “PC sales slip as tablet impact takes hold, analysts report” are just two examples.

Sadly for Apple, the research on which these stories are based is a little less dramatic than some sources are suggesting. Far from slipping, IDC found PC sales in the third quarter of 2010 were up 7.6 per cent when compared to the same period last year, while Gartner reported an 11 per cent increase.

Admittedly, both rises were smaller than the companies’ analysts had expected, but surely the weak economic situation can take some of the blame for this? Gartner also highlighted a decline in demand for “mobile PCs” which over the past two years had been driven by low-priced notebooks and netbooks.  According to Mikako Kitagawa, principle analyst at Gartner, some of this drop off can be accounted for by a growing interest in devices like the iPad.

“Media tablets don’t replace primary PCs, but they affect PC purchases in many ways. At this stage, hype around media tablets has led consumers and the channels to take a ‘wait and see’ approach to buying a new device,” she said.

Personally, I’d question this reasoning. Netbook and low-end laptop purchasers tend to want a simple device capable of accessing the internet and carrying out basic tasks such as word processing. If they’ve purchased one of these in the last couple of years, they’re highly unlikely to upgrade it before the device is either broken or obsolete. I would argue these people aren’t adopting a wait and see approach, they’re simply not interested in buying a new device of any kind right now.

As for other computer buyers, their needs are somewhat different and highlight the major problem facing tablet producers – what the devices are actually for. Kitagawa pointed out that tablets don’t replace primary PCs, but the days when the majority people had a desktop system as their main home computer are long gone. Powerful laptops that can be used for work and entertainment have taken over. They’re portable, easy to use and fully functional. If you don’t want to switch your computer on then in most cases tech-orientated people will have a smartphone which allows them to Tweet, email and even watch videos, so why do you need a third gadget as well? The iPad and other tablets fall between these two stools and that could be their downfall.

Netbooks were successful because they appealed to people who had little interest in computing beyond using them for work or studying, and because they provided a cheap alternative for families looking for a secondary computer. They had a large readymade market, albeit one that now seems close to saturation.

The iPad, on the other hand, has enjoyed a surge of success because it appeals to gadget fans and has few direct competitors. Sooner or later though, Apple will have to decide what the device is actually for and that looks like it’s going to be a huge issue. As Kitagawa said they won’t replace primary computers, but it seems they won’t be attractive to netbook users in terms of functionality or price, so who will they appeal to? The market they’re currently serving is very limited, which is probably why Apple is attempting to push the product as a lifestyle choice above all else.

Had the iPad, by some miracle of technology, been invented in the late 1970s, there would have been two ways for it to evolve. Apple could have made it smaller, say pocket-sized, and perhaps added phone capabilities, or it could have made it bigger and maybe attached a keyboard. Therein lies the problem – the iPad fills a gap in the market that existed for a reason. It’s a bit like inventing a pan that can also be used as a plate to eat off. Useful in some circumstances, but pointless in most.

I could be wrong, and tablets could be set for world domination (they certainly shouldn’t be ignored by digital marketers given their current popularity) but if that’s to happen, then Apple and other manufactures have a massive amount of work to do.

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