Will Android tablets always play second fiddle to the iPad?

Summary:Robin Harris sees the iPad continuing to rule, while Chris Dawson says Android will dominate the market's long tail.

Robin Harris

Robin Harris

Yes, iPad will rule

or

No, Android to close gap

Christopher Dawson

Christopher Dawson

Best Argument: Yes, iPad will rule

The moderator has delivered a final verdict.

Opening Statements

Android will remain on the outside looking in

Robin Harris: Apple has re-defined music players, smart phones, notebook computers and tablets. They've also gobbled up the lion's share of the profits. Apple once dominated the graphical PC market, before losing it to Windows 3.1. They currently dominate tablets likewise. Will Android do to the iPad what Windows did to the Mac?

No, it won't for several important reasons:

* Apple is the volume producer and has the lowest cost structure.

* In addition to its supply chain advantages, Apple has a strong application base and is more congenial to developers given its limited number of platforms, simpler business model and large installed base.

* "Almost as good as" and "slightly cheaper" aren't inspiring battle cries. Unless and until Apple really screws up the iPad formula, Android will be on the outside looking in.

Android will dominate the all-important long tail

Christopher Dawson: Yeah, yeah, the world is all atwitter over the new iPad. Even I'm excited to get mine. It, like the original iPad and iPad 2 before it, looks to set the standard for the tablet market.

That's hardly the end of the tablet story, though. Just as the iPhone took the smartphone into the mainstream, so too will the iPad make tablets a must-have. A look at the smartphone market, however, show us how the tablet market will evolve: Apple will make billions selling at the high end and Android will dominate the all-important long tail.

This isn't a matter of playing second fiddle - It's market segmentation. The Kindle Fire has already shown us what an Android tablet can do at the right price. It's only a matter of time before a variety of well-used Android tablets become a far more common sight than shiny new iPads.
 

The Rebuttal

  • Great Debate Moderator

    Thank you!

    Thank you to both debaters as well as the floor. Be sure to cast your vote and then read Robin and Chris's closing arguments on March 21. I will decide who wins (!) on March 22. Thanks again.

    Posted by Josh Gingold

  • Great Debate Moderator

    Last question

    Despite any short or near terms gains in terms of market share for either device, what is your opinion on which one will likely be around the longest?

    Posted by Josh Gingold

    iPad of course

    They made the market, defined the standard, and are innovating faster than anyone else can afford. They'll stay in the lead. The race for 2nd is what's interesting. Microsoft will aim at the iPad and Android will be collateral damage. Like the iPod, the iPad will rule until something better comes along, probably from Apple.

    Robin Harris

    I am for Yes, iPad will rule

    Equally as long

    There is plenty of room for 2 platforms (or three if you throw in Windows) in the tablet/slate market. That's the beauty of market segmentation. I don't even disagree that Apple will be a market leader for a while. However, if we look at the latest superphones on the Android side, it's clear that Android OEMs are beginning to seriously innovate and the market is responding. Even the Kindle Fire, though not an awesome tablet in terms of specs, is quite innovative in some respects (especially in terms of the browser and its hooks into cloud services for rich rendering and fast loads). Neither Android nor Apple is going away anytime soon and even Microsoft has too much traction in the enterprise to be counted out of the race completely.

    Christopher Dawson

    I am for No, Android to close gap

  • Great Debate Moderator

    What consumers want

    Okay, in your opinions, what are the key market drivers for consumers? Is it any of the above (hardware, operating system, price) or perhaps something different such as the so-called Apps ecosystem?

    Posted by Josh Gingold

    Where techies and marketers disagree

    But first I have to laugh about Chris's Aston-Martin comparison. Let's be clear, Apple has 65% of the tablet market and almost all the profits. If Aston Martin had those numbers we'd be wondering how the rest of the auto industry could survive. Which is what we should be wondering about Android tablets. User experience is the key driver in a consumer market. A friend of mine, computer-phobic, got an iPad a few months ago and just loves it. It does way more than he "needs" it for and yet he is regularly thrilled to discover what else it can do for him that he never expected. There are billions more like him - and tens of millions who are mad at their PCs - who are the market for tablets. People don't care about open vs closed ecosystems or quad-core vs dual. They go for the WOW! and today, Apple delivers that and Android doesn't. And won't.

    Robin Harris

    I am for Yes, iPad will rule

    Angry birds

    I can't say that the Apps matter too much to most consumers. Can you play Angry Birds? Can you update your Facebook status? Can you tweet? Great. Either platform will handle that quite nicely. For those who can afford it, it's the hardware/software combination. Is the experience totally smooth, do videos play flawlessly, are the pixels so dense you can shine your shoes with them? For most, though, it's about the price. Can you communicate and consume content easily at a price you can afford? There's a reason that Apple kept the iPad 2 around and keeps the price of their flagship latest iPad steady at $500. And there's a reason that early high-end Android tablets with great specs but prices over $500 utterly flopped. There's also a reason that the Kindle Fire is the number 1 selling item on Amazon. The price is right. Price matters, both at the high end and the low end of the market. For all the rest, just make sure your tablet plays Words with Friends.

    Christopher Dawson

    I am for No, Android to close gap

  • Great Debate Moderator

    OS vs. HW vs. $$

    What are we really talking about here: iPad vs. Android tablets; iOS vs. Android OS; More expensive tablet vs. a less expensive tablet, or is it all of the above?

    Posted by Josh Gingold

    None of the above

    The key is that this is a consumer market. For products to be successful they have to connect with non-techie consumers emotionally. I trust that no one will argue that anyone other than Apple knows how to do this - everyone else just follows along. Yes, the market will segment. People who like looking at magazines but don't play games will gravitate to the Kindle Fire. People who hack their machines will move to powerful Android tablets. But Apple has shown it can cut prices to compete - iPod Nano - in every segment. Anyone thinking they can easily undercut the iPad is in for a rude surprise.

    Robin Harris

    I am for Yes, iPad will rule

    All of the above

    This really breaks down to 2 business models: Apple: Sell high-end hardware to (relatively) high-end consumers Google/Android: Sell a variety of hardware from which consumers and businesses pick based on their needs and budgets and then make their real money from ads, apps, and content. Google will always have nice flagship devices, but just as Microsoft did with the PC business, they will generally leave the upper crust of the market for Apple. Would anyone argue that Aston Martin is a more successful car company than Ford or Toyota? Probably not, even if Aston Martin makes some of the most compelling, desirable cars in the world. Same goes for Apple vs. Android (or Apple vs. Samsung/Acer/Toshiba/etc., depending on how you frame the market).

    Christopher Dawson

    I am for No, Android to close gap

  • Great Debate Moderator

    The Apple factor

    So far, we haven't seen anything close to pre-sales mania for any Android devices like that which we often see for Apple products and especially the iPad. Is the excitement factor an issue long-term?

    Posted by Josh Gingold

    Marketing makes a HUGE difference

    Google is clueless about marketing and most of their resellers aren't much better. One issue is the misunderstanding of consumer needs. Sure, I use gmail and Google Docs and such, but I don't see any need to move to Android because of it. The biggest threat to Android is that Google will destroy its corporate reputation by mishandling customer data - which is ultimately the business model for Android. That's where their poor understanding of consumers will bite them.

    Robin Harris

    I am for Yes, iPad will rule

    Not in the long term

    It???s very useful for those Apple margins we keep talking about. They need the large group of Apple faithful to be willing to dump their previous generation devices and go buy new devices at launch. I happily sold my iPad 2 to fund the new iPad because, while I'm no fanboi, I knew that the screen and speed of the new iPad would be important for the way I use a tablet. However, in the long term, Android doesn't need users to be excited. It needs users to want and need a tablet and look for the device they can not only afford but that fits best with their personal and business-related ecosystems. Excitement sells 3 million iPads in a weekend. Need sells tablets to the masses and, with that, serves them ads and delivers paid content to them.

    Christopher Dawson

    I am for No, Android to close gap

  • Great Debate Moderator

    All the other devices

    Chris mentions the iPod. How important are all of the other devices such as phones and iPods that are also running on each of the two operating systems?

    Posted by Josh Gingold

    Does Kindle Fire help Android when it's hidden away?

    The larger ecosystem is important for developers, but for most consumers the iPad is a substitute or partial replacement for a notebook/desktop and a smartphone - or an iPod touch - isn't. As Apple improves the iPad's technology that will become even more obvious. That will benefit the higher-end developers of business apps, driving more businesses to go with the iPad. So no, the Kindle Fire doesn't help the larger Android ecosystem very much. It isn't just about raw numbers.

    Robin Harris

    I am for Yes, iPad will rule

    Pretty important

    They???re pretty important...if you as a consumer or business have invested in a particular ecosystem (the use of Google Docs, Amazon music, iTunes, or whatever), the temptation is to stick with that ecosystem. This is certainly an advantage for those moving from their iPods to a phone or tablet, but Google makes it very easy to get your iTunes music into the cloud with Google Play Music, erasing some of that advantage for the Apple crowd. What's probably more important is where you live and breathe -if you spend your day using Google docs, checking your Gmail, etc., then there are compelling arguments against the Apple ecosystem. For developers as well, Android offers much deeper hooks into the OS, allowing for some very creative apps that can't happen with iOS. Point being, that the cloud ecosystem of choice will be more important than the hardware ecosystem of choice. Where is all of your stuff? And can you get to it easily (and, for many people, can you get to it cheaply)?

    Christopher Dawson

    I am for No, Android to close gap

  • Great Debate Moderator

    Kindle Fire

    Much of Android???s growth can be attributed to the Kindle Fire, a low-cost tablet from Amazon. Can Amazon sustain a competitive battle with Apple which arguably has higher margins?

    Posted by Josh Gingold

    Amazon isn't competing with the iPad

    Fire is just a high-end e-reader. Amazon can offer the Fire at a loss because they've got a razor/razor blade strategy. Nobody says the Fire is better than an iPad, they just say it is cheaper. Plus they've done their best to hide Android from end-users, which is a comment on how acceptable Android is to the consumer market.

    Robin Harris

    I am for Yes, iPad will rule

    Sure, because it's all about content for Amazon

    The hardware is absolutely secondary for Amazon. Apple makes plenty of money from iTunes and the App Store, but they're cash cows are their high-margin hardware offerings. For Amazon, they just need to get devices into as many hands as possible and the revenue will flow from there. How easy is it to just grab that latest book, shop from the integrated apps, or watch a movie for free with that Prime membership you paid for? It's a different approach, but one that can be just as (if not more) successful than Apple's. Robin's points about music players are important here. Everyone just listens to music on their devices now, regardless of where they bought them. iPods are toys for kids now who can't afford a phone. Much of our music (and, in fact, movies and other media) just live in the cloud now. Amazon's huge investments in the cloud bear this out.

    Christopher Dawson

    I am for No, Android to close gap

  • Great Debate Moderator

    Speaking of business models

    Which is more important, market share or revenue?

    Posted by Josh Gingold

    Neither

    In terms of creating great, must-have products, Apple would argue for revenue and more specifically, gross margins. Their gross margins have powered their investments in CNC milling, laser cutting, specialized semiconductors and advanced flash technology as well as allowing them dominate the supply chain for everything from flash to displays to air freight from Asia. But in the tablets case you'll see market share and revenue and GM tied together. Apple is and will remain the low-cost producer, which allows them to offer more for the money while keeping their margins high. You saw the success of this strategy with the iPod, which is the right market to compare tablets against. Android's success - such as it is - in smartphones is only because it was free and available. But in tablets there is one company with most of the market and everyone else will be fighting for scraps, as they did in music players.

    Robin Harris

    I am for Yes, iPad will rule

    Market share, FTW!

    It takes longer, but ultimately the largest market share will win out. Market share translates to monetization in big ways, especially when you're Google and rely on ad revenue from the mobile platforms or you're Amazon and rely on content sales. Sure, Apple has amazing margins and is both a Valley and Wall St darling, but in the long run, Android, with the potential for much larger market share, will fund both OEM and content/ad provider revenues in much more significant ways.

    Christopher Dawson

    I am for No, Android to close gap

  • Great Debate Moderator

    Windows 8 slate

    What about the Windows 8 slate? Does it have the potential to be a disruptive factor in the tablet arena?

    Posted by Josh Gingold

    All potential, no kinetic

    It is never wise to count Microsoft out, but their tablet strategy has many problems. They lack the tight integration of HW and SW that Apple excels at. They have little control over the hardware quality of their reseller's products. Their ARM-based products won't have the advantage of the huge Windows ecosystem. I think they'll have decent software, but the hardware won't measure up to Apple's because their resellers don't have the margin dollars to invest in great technologies as Apple does. Android is the likely victim as Microsoft's muscle sucks the air out of the Android business model. If there were a server market for tablets Android might win. But this is a consumer business.

    Robin Harris

    I am for Yes, iPad will rule

    Outside the enterprise? Negatory

    Microsoft has built a very impressive, highly function, and very successful enterprise ecosystem. Within that, Windows 8 slates absolutely have the potential to push Android and Apple aside (or at least be a competitor), where management and interoperability are key. However, on the consumer side (and also taking into account the power of consumerization), Windows 8 slates don't stand a chance. In fact, the consumerization issue will ultimately mean greater success even in the enterprise for Android and Apple than Microsoft will be able to generate with Win 8. Windows 8 slates will be a player there and will drive better management features across the board, but I don't believe they'll ever dominate.

    Christopher Dawson

    I am for No, Android to close gap

  • Great Debate Moderator

    Obvious question, but...

    ...where does The New iPad fit into this equation?

    Posted by Josh Gingold

    New iPad shows how weak Android tablets are

    The New iPad sold 3 million copies in 1 weekend. Android tablets total from day 1 is 12 million. Game over. The iPhone comparison is flawed: smartphones were an existing market. Apple (re)invented the tablet.

    Robin Harris

    I am for Yes, iPad will rule

    I love my new iPad, but...

    The price point for Apple's products is not sustainable once you get past the technorati, early adopters, and top 10% income brackets. Lower cost options, as well as more hackable, customizable options will eventually be demanded and purchased by the market. The new iPad sets the bar in many, many ways. However, 10" isn't optimal for some people, the Apple ecosystem isn't optimal for some, a closed development platform won't work for others, and $500 and up won't work for many more. Apple will and always has pushed the envelope on features and UI, but plenty of other competitors have been quite able to grab the mass market.

    Christopher Dawson

    I am for No, Android to close gap

  • Great Debate Moderator

    Welcome to The Great Debate!

    Robin and Chris, are you ready?

    Posted by Josh Gingold

    Ready!

    Got my iPad handy!

    Robin Harris

    I am for Yes, iPad will rule

    Ready!

    Born ready, in fact :)

    Christopher Dawson

    I am for No, Android to close gap

  • Great Debate Moderator

    Okay, let's begin!

    IDC claims that Android will overtake iOS on mobile media tablets in worldwide market share by 2015. Do you believe it and why?

    Posted by Josh Gingold

    IDC has been wrong so many times. . . .

    Like the PC and music player markets, tablets are a winner-take-all market. That is the vendor who wins early - like Microsoft on PCs and Apple on music players - tends to win long term, because the infrastructure that builds up around the winner makes it the long-term choice for business as well as consumers. Apple has shown it will cut prices when possible to grow market share. Android - and IDC - can't count on "cheaper" to win the day.

    Robin Harris

    I am for Yes, iPad will rule

    The proof is in the iPhone pudding

    That's still 2 years away, which is forever in tech-land. It took a couple years for Android to overtake the iPhone in terms of market share and the same will be the case for the iPad and the tablet market. Ultimately, the promise of inexpensive tablets and many channels (Samsung, Toshiba, Motorola, Acer, etc., etc.) will bring the Android market share ahead of Apple. Apple can't compete long term with so many different channels, although it will obviously have huge success and margins in its single OEM approach.

    Christopher Dawson

    I am for No, Android to close gap

Closing Statements

Apple goes where the market leads

Robin Harris

Despite trying to tie the iPad to the iPhone market, it is obvious that the iPad is more like the iPod market. Like the iPod, Apple invented the tablet market, set the bar, and has established a dominating market share.

Many companies came and went in the music player space, which Apple continued to dominate, until the iPhone began obsoleting the iPod. The same will be true for tablets.

The basic arguments for eventual Android dominance are price and - maybe - choice. But Apple is the low-cost producer, and as the iPod shows, they are willing to go where the market leads. If they need to they can build a $250 iPad - and keep their market lead.

Android for the mainstream

Christopher Dawson

I love my new iPad and so do 99% of the 3 million people who bought it in its first weekend on the market. That really is an impressive number, one much like the numbers that Apple posts whenever it releases a new iPhone. Those numbers, though, largely represent the low-hanging fruit of early adopters and Apple faithful. As the tablet becomes a mainstream device that, for many, replaces a home PC, the market will shift in much the same way that the smartphone market has evolved.

Apple certainly isn’t going anywhere, but there’s room for two at this party. Android will continue to appeal to bleeding edge users and developers/hackers requiring more flexibility than iOS offers. More importantly, at the mainstream end of the market, it will deliver ads to fill Google's coffers, low margin/high volume sales for OEMs, and solid value for consumers and businesses.
 

Apple's party is far from over

Josh Gingold

What I'm about to say is bound to be controversial, and most of you will not be happy, but I think that Robin Harris has it right.  The sun is far from setting on Apple's party and the iPad, or more specifically the iOS, will continue to rule in the foreseeable future.  There simply is no denying the advantage that Apple has in a market that is increasingly driven by consumers.


For me, there are two key issues that arose from this debate and hence formed the basis of my decision.  First, Microsoft Windows 8 will soon make its presence known in the market and seems much more likely to cut into Android share before converting any of the iOS faithful.  Second, Apple's much-criticized approach to integrated engineering actually provides a competitive advantage when it comes to controlling the features, direction, and, yes, the price of its products.

Which is actually better?  All I have are my opinions but Robin's comparison to the iPod is a good one.  Every music device was supposed to be the "iPod killer" and yet here we are.  I believe the same will be true for the iPad, not because I'm a fan of Apple products but rather the company itself which seems better prepared than any other to find and serve its market.


Topics: Great Debate

About

Josh Gingold is the Managing Editor of Business and Technology Research Libraries for CBS Interactive with primary responsibility for the presentation of key research and commentary through a combination of blogs, white papers, and Webcasts. Josh's past experiences include a variety of editorial and production assignments for CNBC, CNET... Full Bio

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