Between the Lines

Larry Dignan, Andrew Nusca and Rachel King

Apple's iPad, iPhone and an enterprise halo effect

By Larry Dignan | July 21, 2010, 3:00am PDT

Apple’s iPad and iPhone are garnering enterprise interest and proving the company can go corporate. Can the iPad and iPhone spur a broader enterprise halo effect?

That question looms large after Apple operating chief Tim Cook verified what some tech CEOs have been talking about since the iPad launch in April. Bottom line: The iPad has a role in the corporate market and there’s a lot of interest.

Cook said following Apple’s earnings that “more than 80 percent of the Fortune 100″ are planning or evaluating the iPhone and Apple is seeing good momentum in the Fortune 500. That momentum is transcending into education institutions, said Cook. And the real kicker: 50 percent of the Fortune 100 are testing and evaluating the iPad in the enterprise.

Specifically, Cook said:

If you look at the iPhone, we’re now up to more than 80% of the Fortune 100 that are deploying or piloting the iPhone, and we also see very good momentum in the Fortune 500. In fact, over 60% of the Fortune 500 are deploying or piloting iPhone. This is also transcending into education institutions, and we see around 400 higher education institutions which have approved the iPhone for faculty, staff and students. And so iPhone is really taking off, and iOS4 was another help in doing that.

And the iPad is off to a good enterprise start:

The iPad, very surprisingly in the first quarter, so in the first 90 days, we already have 50% of the Fortune 500 that are deploying or testing the iPad.

Those comments verify what execs like SAP’s Hasso Plattner have been saying: The iPad is a strong mobile device for things like business intelligence applications and real-time sales data.

So what’s going on here? In a nutshell, corporate customers are getting used to Apple’s iOS platform. It took a while, but there’s real traction for the iPhone in Corporate America. Apple has a small enterprise sales team so it’s not completely about the consumer.

Also: Photos: Useful apps for Apple iPad

These enterprise customers are taking the iPhone for a spin and now looking at the iPad since the underpinnings are the same. For a select group of employees, the iPad could replace the PC. Given that prospect, it’s not surprising that Cook was asked about a potential corporate halo effect. Cook acknowledged the worries about the iPad cannibalizing other Apple products, but noted that there may be some more positive developments. Could the iPhone and iPad drag the Mac into the enterprise?

Possibly. Cook added:

We’re still selling principally to consumer and education, but we are seeing businesses with increasing interest in the Mac. it is more difficult to measure because many of those sales are filled through the channel.

If this scenario were to play out Apple could see something like this:

Corporation adopts the iPhone.
Same companies uses the iPad for sales folks and field workers.
That company is more open to a Mac purchase when it’s time to upgrade corporate PCs.

Cook said it’s too early to make any predictions, but he likes Apple’s chances.

The Mac share is still low, and so there is still an enormous opportunity for the Mac to grow, and certainly the more customers we can introduce to Apple through iPads and through iPhones and through iPods, you would think that there might be some synergy with the Mac there, and there may be synergy between the iPad and the iPhone as well. This is where it is great to have a lower share, because if it turns out that the iPad cannibalizes PCs, then I think it is fantastic for us, because there is a lot of PCs to cannibalize. It is still a big market.

It’s early in the game, but watch those enterprise adopters for the iPhone and iPad. The enterprise may be boarding the Apple bandwagon shortly.

More background on iOS in the enterprise:

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Topics

Apple iPhone, Apple iPad, Apple Inc., Sales Strategy, Smart Phones, Sales Force Management, Sales, Consumer Electronics, Personal Technology, Larry Dignan

Larry Dignan is Editor in Chief of ZDNet and SmartPlanet as well as Editorial Director of ZDNet's sister site TechRepublic.

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Sooner or later the enterprise will discover "choice."
fuzzlogue
21st Jul 2010
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RE: Apple's iPad, iPhone and an enterprise halo effect

@fuzzlogue

They just have... that choice is iPhone & iPad, and soon... Macs
sip01
21st Jul 2010
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RE: Apple's iPad, iPhone and an enterprise halo effect

@sip01

OMG! Talk about Macboys, what a load of arse! When Jobs blamed the slow up take in enterprise on them being lazy. What he meant to say was:
We are slack and we never built our propriety devices properly, so they don't support networking environments properly.... Instead he puts the blame back on enterprise and all the gullible Macboys out there believe it..

How many of you Macboys actually run a large networks I wounder? 500~1000 computers or more - I do, and I support plenty of Apple products also, so her is the thing. They don't work well in enterprise because they don't support technologies that are designed for enterprise. They rely on old school software like iTunes that does not work in a multi user/networking environment properly, data can't roam, users can't roam, data is stored in the wrong places... on and on it goes. Mac profiles suck, you cannot enter proxy or bypass proxy setting in browsers ...
All of this impacts not only on the guys that support it, but also the users of the product.

I love the hardware and the concept with the iPhone and iPad, but these devices really are aimed at the home and they really are difficult to use in a networking environment and that's Apples fault.
red400r
21st Jul 2010
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RE: Apple's iPad, iPhone and an enterprise halo effect

@red400r

Talk about being clueless. I find it VERY difficult to believe that you administer networks of PCs with any competence, let alone a mixed network with macs. The fact of the matter is, macs work better in mixed networks than most Windows boxes, and support industry standards such as DAVE and Samba out of the box.
More evidence that you have no idea what you are talking about: they do not RELY on iTunes, in ANY way shape or form. Perhaps you are talking about iPhones? You can't enter proxy settings?!? That's funny, I wonder what System Preferences/Advanced/Proxies... does?
Data can't roam? Really? Coulda fooled all those for whom it works easily.

BTW, if you are going to edit your posts, could you at least bother to correct the NUMEROUS errors in basic English?
DeusExMachina
23rd Jul 2010
- Flag
But Ballmer says

iPhone doesn't appeal to business.
"500 dollars? Fully subsidized? With a plan? I said that is the most expensive phone in the world. And it doesn't appeal to business customers because it doesn't have a keyboard. Which makes it not a very good email machine."
I don't know how much clearer Ballmer could be. He has, with all the weight of his historic captain of tech industry weight, declared that the phone doesn't appal to business customers.
So what's this about 80% of Fortune 500 companies evaluating it? Are they not listening?
HollywoodDog
21st Jul 2010
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RE: Apple's iPad, iPhone and an enterprise halo effect

@HollywoodDog

Of course, we all know Ballmer's motives in saying that the iPhone has no place in the enterprise (without benefit of the research Tim Cook brings to the table in this article) are as pure as the driven, Alaskan snow . . . after a few huskies have done their duty on it. Ballmer's vested interest with Microsoft is further demonstrated in his company's refusal to work with Apple on mobile Office apps for iPhone and iPad (why the tech press's deafening silence on that, by the way?) and Redmond's "me too" efforts with Windows 7 Phone.

Spreading the idea that the iPhone costs $500 a pop is false, irresponsible FUD, and Ballmer is not fooling the American public or enterprise CEOs, CFOs or CIOs who are looking into the iPhone for business because they know and love it for personal use already and understand its potential in the workplace. If 80% of Fortune 500 companies aren't listening to Randall Ballmer on this, in my humble estimate, that's a *good* thing.
TCollinsG3
21st Jul 2010
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RE: Apple's iPad, iPhone and an enterprise halo effect

@HollywoodDog I wonder what the price point is for the enterprise?
Just because they are evaluating doesn't mean they are buying. The pad is new and justifies a look see. The phone is being requested by employees because of the "cool factor" so they are evaluating. I am curious about how many are actually using the iPhone as their sole corp. phone.
coachgeorge
21st Jul 2010
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RE: Apple's iPad, iPhone and an enterprise halo effect

@coachgeorge
I can see businesses adopting this if APs come out to support this direction. My Dr. Office bought 6 of these because the Pharmaceutical companies are supporting it. The question is how can the Ipad be implemented. I use mine for email, internet and Skype. It is very useful and this is early on. I am sure developers are are evaluating the ways to develop for it. My Father inlaw currently takes a laptop to sites for working on hydraulics and engines for big equipment. He said the touch pad makes it hard to scroll through 100 page .pdf files while working. He said he could see the ipad making it easier. He said the glass would be easier to clean then laptop touch pad. There is room to move for sure.
spikedstrider
21st Jul 2010
- Flag
Evaluating doesn't mean using.

@HollywoodDog Evaluating it doesnt mean they are using it. It means they are considering it. Its just another way that Apple puts a spin on numbers to make their products seem bigger than life. Apple products have been evaluated by the enterprise before and failed to pass the tests. Which is why Blackberry dominates in the enterprise. Because it offers enterprises everything they could possible need/want in a phone. And keeps the prices low, the service reliable, and the phones conservative.
Android has a better chance of getting adopted in the enterprise because it has more openness and would allow enterprises to tailor it for its needs. But that still requires more work than just sticking with blackberry, a system they already know and trust.
As for tablets, the iPad is cheap compared to some other tablet solutions. But it also doesn't have the features that other specialized tablets do. Like barcode readers, signable screens, or apps that link to a main home network (other than apples). And this is where the most tablets are put to use. In places like delivery companies, field agents, etc. And they all run very specialized applications that are developed and maintained by these businesses. So not only would using iPads require businesses to get Apple computers to develop software with, but they would have to put their specialized apps out in the wild via the App store, since they can't install things themselves.
Jimster480
21st Jul 2010
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RE: Apple's iPad, iPhone and an enterprise halo effect

@Jimster480

Not much of a spin a all jimbo. They said evaluating. Look it up, you Apple bigot-boy
thofts
21st Jul 2010
- Flag
I mainly posted that for the keyboard quote

@HollywoodDog ... is it true that business won't buy phones without a physical keyboard for that alone? Seems dubious. Now Microsoft is releasing a lame copy of iPhone in Windows Phone 7, and no keyboard, or at least I didn't see one in the online videos of it. Does that mean they don't want enterprise business or are not trying to get it?
Has Ballmer changed his opinion about smartphone keyboards and their relative necessity?
HollywoodDog
21st Jul 2010
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RE: Apple's iPad, iPhone and an enterprise halo effect

@HollywoodDog
Just wondering how much time you spent 'evaluating' the Windows 7 Phone before you decided it was 'lame'
jamsdwy
21st Jul 2010
- Flag
RE: Apple's iPad, iPhone and an enterprise halo effect

@HollywoodDog we have them here as ONE of many choices for our employees to choose from. The iPhone and plans are some of the most expensive available through our employee self-service site. We have BB's all flavors, and Andriod and WinMo. The #1 choice is BB according to our Help Desk. Some use the iPhone and like them a lot a lot don't for the very reason you gave, they are horrible email phones. I have one because I have oncall support and I can do somethings with the phone for SAP, I"m also beta testing the iPad and it's capability. Again - they are just tools and are good tools, but 30%-40% is probably right - mostly due to the keyboard and horrible battery life. If I turn off wi-fi and set email to on demand, I can get a day out of the phone. To show you how bad the battery is compared to the other offered phones. Each user gets a car charger kit, a second charger cable (home and laptop) and a emergency batter charger to keep in our bags that you can plug into the phone if it's dieing. That all comes with the iPhone package you order from the site.
ItsTheBottomLine
21st Jul 2010
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RE: Apple's iPad, iPhone and an enterprise halo effect

@HollywoodDog I don't if you've ever tried to use the small keyboard and tiny trackpad on the Blackberry but I have and it's a real pain. The iPhone is far easier to use in every way than a BB so I don't see a good reason for enterprise customers to stay away from the iPhone.
Bill Snebold
21st Jul 2010
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"evaluating"...sure.

I'm a CIO. I "evaluate" a great number of products in course of a business year. How many do I go with? Maybe 1%.

The more telling number is the 20% who won't even evaluate the product.

The iPad is nice, but their are a number of pads in the pipeline, and they promise to be more capable devices.
trickytom2
21st Jul 2010
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