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Intel and Microsoft hope to cut iPad market share to under 50 percent by mid-2013

Summary: The battleground that Intel, Microsoft, and the ODMs have chosen to challenge the iPad on is a predictable one: price.

Adrian Kingsley-Hughes

By for Hardware 2.0 |

Tech giants Intel and Microsoft are hoping that the first wave of tablet PCs running Windows 8 will push the iPad's global market share down from the current 70 percent to below 50 percent by mid-2013, according to Taiwan-based ODMs speaking to DigiTimes.

The report claims that while Microsoft will release Windows 8 for the x86 platform to hardware manufacturers in September, Windows RT for ARM devices will follow at a later unspecified date. Despite this staggered release, the unnamed ODM asserts that by the end of 2012 there will be more than 30 tablet PCs running Windows 8 from big names such as HP, Dell, Lenovo and Acer.

The battleground that Intel, Microsoft, and the ODMs have chosen to challenge the iPad on is a predictable one: price.

It is reported that Lenovo and Acer will have tablet PCs starting at $300, priced to compete with not only Apple's iPad, but the slew of Android-powered tablets flooding the market.

It would be foolhardy to ignore Android tablets given that they themselves are putting pressure on the iPad, with Javelin Strategy & Research predicting that the Android tablet market will soon overtake the iPad. Apple set the price for tablets, and failures such as the Motorola Xoom and the BlackBerry PlayBook have shown that trying to redefine this at a higher level is doomed to failure.

There's no word on the hardware specifications of this budget hardware, especially at the $300 end of the spectrum. Will the ODMs cut corners or will they be able to deliver a quality product as such a tight budget? We'll have to wait and see.

Both Intel and Microsoft have good reason to want to see the iPad's global market share cut down to below 50 percent. The iPad isn't built around Intel's Atom CPU and doesn't run Microsoft's Windows operating system. Both companies desperately need an answer to the iPad, and hope this will be in part catalyzed by Windows 8.

Intel has already given us a sneak peak at an interesting looking hybrid tablet ultrabook running Windows 8. The Letexo hybrid system transforms from a tablet into a system that has a keyboard and a screen propped up on a stand.

Image credit: ZDNet.

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Topics: Laptops, Hardware, Tablets, Software, Operating Systems, Mobility, Microsoft, iPad, Intel, Windows

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26 comments
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  • Good Luck with That

    Now MS will feel what it's like to be the underdog and to displace the top dog. And I predict it won't happen. Look how many have tried to unseat MS's Windows market share and how has that worked out for them?

    Windows' name is a turn off. People associate it with their crappy PC and they will not want to repeat that experience on a tablet.
    itguy10
    Reply Vote

    • Yeah so crappy that

      Windows 7 has become the fastest selling operating system in history, selling more than 500 million copies in the first 3 years, indeed Windows 7 has a well deserved reputation for excellence....face it, your perceptions are stuck in the mid to late 90's
      Doctor Demento
      Reply Vote

      • And yet

        Despite that the Mac marketshare is growing and PC is declining.
        Internet Explorer use is declining.
        Windows Phone 7 use is declining.....
        itguy10
        Reply Vote

    • Now?

      "Now MS will feel what it's like to be the underdog and to displace the top dog."

      You obviously think that Microsoft = Windows and that Windows = complete desktop domination since forever and ever, but both premises are completely false.

      Microsoft has many more products besides Windows, you don't know but there was a time when Internet Explorer was the underdog (this was when Microsoft actually invented AJAX); MS Office was, for a long time the underdog, Word was way behind WordPerfect and Excel was way behind Lotus 1,2,3; The XBox was the underdog, selling way less than the PlayStation and the hi-end Nintendo (that no longer exists); Windows itself, and this relates to premise 2, was an underdog itself, back when Microsoft launched Windows, way more people used Macs.

      If there's a company that knows what being the underdog is, it's Microsoft.
      CarlitosLx
      Reply Vote

      • Recheck your facts.

        "Word was way behind WordPerfect and Excel was way behind Lotus 1,2,3; The XBox was the underdog, selling way less than the PlayStation and the hi-end Nintendo (that no longer exists); Windows itself, and this relates to premise 2, was an underdog itself, back when Microsoft launched Windows, way more people used Macs."
        With the exception of the xbox, Microsoft leveraged their monopoly power with Windows to create other monopolies. The xbox 360 is not the most advanced game console, by a wide margin. Microsoft only counts units shipped, in which case having defective consoles works in their favor. It's been so successful that Microsoft is using the same strategy with WP7. Rather than publishing the activation numbers (Microsoft knows exactly how many phones have been activated), the publish the number of license stickers they've pushed out to ODMs.
        Jumpin Jack Flash
        Reply Vote

      • You picked some lousy examples...

        You picked some lousy examples. Lotus, Netscape, and Apple (with Digital Research) were the key reasons for the conviction of Microsoft for violating U.S. antitrust laws; United States v. Microsoft.

        [quote]Windows itself, and this relates to premise 2, was an underdog itself, back when Microsoft launched Windows, way more people used Macs.[/quote]

        No. By the late 1980s, Microsoft commanded over 80% of the desktop operating system market.

        In none of your examples, save for the XBox, has Microsoft ever been the underdog.
        olePigeon
        Reply Vote

    • Wrong

      Microsoft dethroned Palm in the Pocket PC market, Netscape in the browser market and Sony AND Nintendo in the console market. Microsoft does their best work when they are not the market leader. It might take a couple years, but they'll make it to the number 1 spot in the phone and tablet markets.
      clcrockett
      Reply Vote

  • Intel and Microsoft hope to cut iPad market share to under 50 percent by mi

    I hope they succeed! This will bring competition and lower prices which is good for the consumers. But mostly because I want the tablet fad to fade away once everyone has one and then just kind of stops using them.
    Loverock Davidson-
    Reply Vote

  • Market Share is not what it was... and I'm not sure even in the past

    it was ever what people thought. PROFIT is king and if MS and Intel want to play the market share game good on them. Still what with Android and google fighting for that title as well what does it mean if Apple's share of the market dips below 50 percent? I think it means there are more OEM's selling a variety of products and two viable OS alternatives to iOS which comes to a huge so? Apple can and will likely loose market share in tablets but Apple can do this and still win big time:) That's the beauty of it its a no loose situation for Apple while others can't do this kind of thing.

    Pagan jim
    James Quinn
    Reply Vote

    • It is what is like in the past

      Just like Macs.
      Back in the day when Macs/Apple was leading the PC industry it was WinTel and OEMs that kept undercuting Apple in openness and pricing, causing PCs to commoditized. Mind you the Mac was a premium product (it has always been) so the profit margine was already huge but eventually lose the marketshare as well as with the profits. Strickly speaking, Apple didn't price themselves out of the market, the market does. While Mac is a very successful hardward business for Apple, it didn't catch on to the level of PCs and never will. Did I mention the PCs and the Mac business already slowing down?

      Now we started to see tablets are driven down to sub $299 pricing and even more capable Win8 machines will be priced to the same if not less than an iPad. Where else Apple can go?

      Sorry but there is no "beauty of it", but a half-full-half-empty glass of water. Apple will either keep the current marketshare or start to lose. When you're on the top, only way is really just down.
      Samic
      Reply Vote

      • Macs NEVER were market share leaders. That's my first point.

        As for prices going down sure did and so did what hundreds if not in the end thousands of PC OEM's? I really don't know cause there were sooooo very many that kept coming and going. So all in all I'd rather be Apple rather than say a GateWay? Do they even still exist? Now that there are three players not just Apple and MS I don't think MS will see the benefits even "IF" it manages to win a price war with Google cause Apple ain't gonna play the price war game:) Perhaps in the end this will be thought of as good for the consumer but I can assure you that while many an OEM came and went leaving customers holding the pag after purchasing their products or worse with little or no support after purchase cause the company did not actually die but dragged on for years until a final dust up a great many consumers suffered in the process. I won't even bring up blankware that was and still in many cases is bundled on PC's to help make up for razor thin margins and such! Oops I guess I did bring that up:) MS and Google will have their price war and in between that their will be a further price war with in their given platforms as each individual OEM tries to up end the other. It will be sick but fun to watch from the OUTSIDE!!!

        Pagan jim
        James Quinn
        Reply Vote

  • Instead of having as a target to beat iPad...

    ...why not try to have as a target making one of the most amazing product ever? While I'm not sure if Windows 8's paradigm shift will be accepted by current Windows users, the interface looks great for a tablet.
    themarty
    Reply Vote

  • Windows 8 is certainly different...

    Windows 8 is certainly different, however, I'd be worried about the user experience on a budget tablet. I applaud Microsoft's ability to make Windows work on so many different configurations, but if the "Windows Vista Ready" debacle has taught anything, Microsoft and Intel can't rush this. I can't imagine Windows 8 RT or Windows 8 running on the current crop of low-end tablets.

    The iPad is an expensive tablet because the hardware incorporated is expensive -- keep in mind that it's reasonably priced compared to the competition, it's just that tablets of that category are expensive no matter from who you buy. The iPad is responsive because the OS and hardware are controlled by the same company, allowing for optimizations and probably various performance "tricks" to get the OS to run smoothly.

    Despite Android being open and potentially custom tailored to hardware, it has been criticized as having a "choppy" user interface. Many users report that the transitions and user feedback animations occasionally stutter or stop; scrolling, slideshow animations, application notifications, etc. This is despite the tablet having dual core processors and hardware accelerated GUI. These issues are still prevalent on Google's trouble tickets.

    I'm not harping on Android, lots of people will claim to have a flawless experience with the tablet, but I'm drawing on this example as what Microsoft is going to have to contend with. Not just getting the OS to respond in a reasonable fashion, but to get it to do it on commodity hardware.

    If they aren't careful, I think Intel and Microsoft are setting up for failure.
    olePigeon
    Reply Vote

    • IF (big if )

      It runs as fast and smoothly as the Windows Phone OS, which runs on very light weight hardware compared to iOS and Android, choppy and slow won't be an issue. Even iOS is choppy and slow on the older hardware running updated iOS.
      My first gen iPhone with iOS 3 something ... is choppy as all get out with scrolling in Safari, slow and jittery with zoom pinch, etc.
      whatagenda
      Reply Vote

      • It's running Windows 8 with Metro, not Windows Phone OS...

        It's running Windows 8 with Metro, not Windows Phone OS, and I think you've inadvertently hit the nail on the head. Apple keeps their mobile and desktop OS separate. iPhones and iPads run iOS, MacBooks and Macs run OS X. You don't run a full desktop OS on the iPhone or iPad.

        To me, at least, it seems like Microsoft is trying to do the opposite and shoehorn Windows 8 onto a tablet. I would agree with you 100% if they were putting Windows Phone OS on a tablet, it'd probably run like butter. Windows 8? Not so much.

        All we can do is wait and see.
        olePigeon
        Reply Vote

  • This isn't Mac vs Wintel fight...

    Microsoft's strategy of cheap hardware running a mediocre me too operating system isn't going to work in the tablet arena. Your target audience isn't looking for cheap, they're looking for quality. People on a limited budget aren't going for tablets, they're going for cheap laptops. The vast majority of of tablet users already own a smart phone, laptop and/or desktop computer and are looking for something very portable, light and capable of perusing the internet and something nice for reading books.

    They have the money for a tablet purchase, and they're not looking on who's the least expensive. If that were the case, Apple iPad sales would be down to about a 20% cap. What sells a good tablet is: quality applications, an intuitive easy to learn operating system, design, high quality hardware (aircraft quality aluminum carved out of a solid billet, who else is doing that?), weight, battery life, response and accuracy. Nothing out there comes anywhere near the performance of the iPad.

    Microsoft beat Apple in the ninety's with cheap hardware running MS Windows, but this is a different battle. Apple learned from the mistakes they made then, they learned their lessons well. They have a huge head start, their competition is in perpetual catch-up mode, they've patented their IP to the hilt, they already are competitively priced, and they're stuff just works, I mean their stuff really really works very well. The non-Apple choices so far, have looked incredibly lame in comparison.

    Unlike they're competitors, Apple doesn't push anything out the door until it's ready. This has lead to very positive user experience responses which in turn has translated into huge sales and a consistent high percentage of the tablet market share. So to say Apple will be below 50% of market share by 2013 to me is just wishful thinking from Apple's competitors.
    gtdworak
    Reply Vote

    • And...

      What is this "mediocre me too operating system" you speak of?
      CarlitosLx
      Reply Vote

      • Pick one...

        Anything else without the Apple name.
        gtdworak
        Reply Vote

  • But I thought nobody wanted tablets?

    At least that's what most of you Windows Fanbois were saying when the iPad first launched....ROFLOL And wasn't that brilliant Ballmer's position too?
    GoPower
    Reply Vote

    • You have to see it from their perspective.

      Unless the segment is dominated by Microsoft, it's either a Fad, or not worthy of recognition. Ballmer's view is that unless Microsoft makes $50, or more on each, tablets are not worth the effort. If the ODMs only make $12 on each, Ballmer doesn't care. As Microsoft CEOs have often said, If the hardware people lose money, so Microsoft can make even more money, then it's a great day.
      Jumpin Jack Flash
      Reply Vote
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