Jeff Orr of ABI Research was one of my go-to analysts when I covered netbooks and tablets in my past life as a tech reporter. So I was pleased to speak to him again last week and get his thoughts on where tablets and other mobile hardware are headed next year. Here are eight of his predictions:
1) Consumer tablets (iPad, Galaxy Tab, etc.) won't kill the rugged device market. Bulky, ugly, but tough as nails, a few million Windows-based tablet PCs are bought every year for military, field service or health care use. Drop them off a moving truck, expose them to a swirling sandstorm, spill fizzing beer on their keyboards - no problem for these ruggedized, miltary-grade devices.
The biggest chink in their armor? Their price. Vendors such as Panasonic and Motion charge between $2,000 to $5,000 for their gear. Even 'business-rugged' devices from Lenovo and Dell tend to start for at least $1,000. That makes them all vulnerable to $500 tablets like the iPad, BlackBerry PlayBook and others. With their huge and growing selection of apps, and the option to add a military-grade case, won't companies just go the consumer tablet route?
Orr disagrees. "The reality today is that enterprises are evaluating the iPad because they have to, not necessarily because they want to," he said. Rugged devices still have some advantages over consumer ones: swivel-around keyboards, larger screens, more enterprise apps, even a bigger selection of add-ons (vehicle mount, anyone?).
However, Orr does believe that rugged tablet makers will start switching from Windows to Android to remain cost-competitive, some doing that sooner than later.
2) On the other hand, consumer tablets will dominate over enterprise tablets like the Cisco Cius and the Avaya Flare. The latter products will vary greatly in size - 7-inches for the Cius, 12-inches for the Flare. Both will, according to Orr, "serve a purpose not addressed in the enterprise today": a communications device optimized for quick videoconferences or tele-meetings with co-workers. At the same time, "that's not the market opportunity," said Orr, adding that "it's a bit of a distraction to call them a tablet, since they aren't intended to be a companion device."
On when tablets will eclipse netbooks, Orr says he "doesn't see a cross-over point."
3) Microsoft won't port Windows Phone 7 to tablets. Orr calls the new smartphone OS "really crisp." But he doesn't expect Redmond to bring it to tablets the way Google is doing with Android, pointing to its very name as a strong signal of Microsoft's segmentation strategy. Not that he is so high on Microsoft's current tablet strategy. "It's still a bit elusive," he said. "They've been making tablet PCs for a decade now, but the UI (user interface) still needs help."
4) ARM will continue to reign in the near-term. Consumer tablets based around Intel's Atom CPU may start arriving next year, but Orr thinks an actual invasion of Atom tablets "will be slow in coming...there will still be many ARM vendors versus a few Atom-based ones. I'm not too bullish [about Atom] next year."
5) Dual-core CPUs won't dominate in 2011. The ARM Cortex A8 is the dominant mobile CPU today, used in the iPhone 3GS/4, the iPad, the Motorola Droid/Droid 2/Droid X, and others. That won't change next year, says Orr, despite RIM's apparent promise to release a dual-core PlayBook for under $500 early next year. Orr does expect some manufacturers, especially business-focused ones, to join RIM and release tablets running the multi-core Cortex A9, just to push the market forward, though.
6) On operating systems: Google Chrome could be a "really interesting play" on tablets because of its instant-browse capability. RIM's QNX operating system for its coming PlayBook, meanwhile, won't "be that much of a departure from what RIM already has."
7) With a tough economy, $500 tablets will become a popular 'family gift' this Christmas. While tablets are still a luxury, "I get the impression that people are looking for a bit of good cheer this year," he said. To compromise with the uncertain economy, families will buy tablets as collective gifts. Orr expects 11 to 13 million tablets to be sold this year, putting him at the bottom of analyst estimates. He remains relatively cautious next year, too, forecasting 22 million tablet shipments.
8) Netbooks will still outsell tablets for the foreseeable future. Rampant tablet bulls like Digitimes Research are predicting that tablets could outsell netbooks as early as this Christmas quarter. Not Orr, who is forecasting 43 million netbooks to be sold this year, or 4x his tablet forecast.
Netbooks "continue to grow at a very respectable rate. It's not the same as the last two years, but there's no decline," he said. By 2015, when Orr expects 80 million tablets to be sold, netbooks will still be ahead. "I don't see a cross-over point," he said.