Peanuts to Profits With Thor Schrock
Peanuts to Profits With Thor Schrock

If 2009 was the year of the netbook then 2010 may be the year of the slate PC.

Apple’s iPad tablet device on follows the demonstration of an HP tablet device (also called a slate PC) at the CES.

As the recession hit the US in 2009, computer sales were only 2.8% up in the US as compared to a 24% increase in 2008. In fact the first three quarters of 2009 were awful for computer sales across the country – until netbooks saved the day in Q4.

The idea of a 10″ touch screen device that has the power of a notebook and the size of a netbook intrigues me. I can see moving my front desk employees off their desktop PCs and onto iPads or Slates.

Size and Options Mater

I thought it was really interesting that Apple is only introducing the iPad in one size. Apple is clearly targeting the iPad as a lifestyle device while PC manufacturers are targeting the slate form factor as a flexible and useful productivity tool.

Its almost like apple is lining up another Mac vs. PC battle that they can never win – a proprietary Apple device with a closed software distribution channel and PC with flexible devices with customizable options and a ton of inexpensive software already in the pipe.

It’s all About the Content Stupid

While PC manufacturers will most likely sell many more slates than Apple will iPads, the real money is not in the device its self, it is in the content that is consumed on the device.

Apple will be releasing its new web-based version of iTunes later this year, which will allow Apple users to synchronize their content between multiple devices like an iPhone, and iPod and an iPad.

Apple followed a similar release model with the iPhone. When the 1st generation phone was released it was lacking in many basic cell phone features (ability to shoot video, picture messaging, etc) yet Apple released it anyway. They needed to get a device in the market so developers would begin building content.

As the content grew, so did iPhone’s advantage over other smart phones and subsequent versions could be subsidized to include more features because Apple was making it back on the content.

I would expect a similar model for the iPad. The 1st generation device has no webcam, yet has software handles for video calling for example. I would expect subsequent revisions of the iPad to add additional features as the content growth allows.

How do you think the iPad will do?

There has been a lot of chatter all over the web regarding Apple’s expected announcement of the iSlate tablet device on or around January 26, 2010.

There are a lot of people with a lot of ideas about what the iSlate tablet is, what product niche it is designed to fill in Apple’s product line, what its features will be, and how much it will cost. While no one knows the specifics yet, I believe a lot of the rumors are slightly off-base.

Everyone is wrapped up in what Apple has ordered from suppliers, what the iPhone can do, Apple’s supposed need to compete with netbooks, and pure desire for something new from Steve Jobs.

Many of the people turning the crank on the rumor machine are fogetting some of the known Apple quantities:

1. Steve Jobs doesn’t chase market niches – he redefines them
2. Steve jobs has publicly stated that netbooks are substandard hardware
3. Apple risks cheapening its brand by selling a sub-$1000 computing device
4. This is a lifestyle device – people will not buy it because the need it. People will need it because they want it

Rather than getting all caught up in the expected specifications, whether or not it has an OLED screen, or attempting to decode vague requests to iPhone application developers for more high-resolution apps, I am going to make three general Thorstradamus predictions:

1. There is a distinct possibility that the late January announcement is about an improvement in the iPhone. I peg this at a 60% chance. Apple is about the software & apps, and they’re just not there yet.
2. If the announcement is about an Apple tablet, it will cost more than $1200. It may be re-released later at a lower cost as Apple did with the iPhone
3. I do not think Apple will launch a device designed to compete with $400 netbooks EVER

What do you think? Post a comment below to go on the record. Let’s see who is right on this one!