Apple iPad tablet: What the analysts said

Just a big iPod Touch or a netbook killer?

Apple's iPad tablet was unveiled this week - ending months of speculation and hype.

The touchscreen device, which resembles a giant iPhone, is designed for web browsing, playing games and reading e-books. The half-an-inch thick gadget has a 9.7-inch screen, weighs 1.5 pounds, and comes in two versions; one with 802.11n wi-fi and one with wi-fi and 3G.

Analyst reaction to this latest piece of Apple hardware has been mixed - with some praising the device and predicting a fast adoption - although others have been less convinced.

Just a big iPod Touch or iPhone...

Some analysts have expressed disappointment that the gadget appears to be 'more of the same', rather than a new type of device. "I wouldn't say it's revolutionary, more evolutionary - just a big iTouch/iPhone," noted David McQueen, principal analyst at Informa Telecoms & Media, adding: "I'm still unconvinced about demand in this nascent device segment. If it wasn't an Apple product would there be as much fanfare? I'm not sure that people will be willing to part with between $499-$999 for another device."

McQueen's view was echoed by James McQuivey, VP, principal analyst at Forrester, describing it in his blog as a "a very nice upgrade to the iPod Touch".

But he added: "It's not a new category of device. It doesn't really revolutionise the five/six hours of media we consume the way it could have. It doesn't even send Amazon's Kindle running to the hills for cover. In fact, the competitor likely to take the biggest hit from the arrival of the iPad is Apple, in the form of fewer iPod Touches sold and fewer MacBook Airs sold.

"In the end, no innovations in user experience have been offered that will take that media experience to the next level for consumers."

Dean Bubley, founder of Disruptive Analysis, also declined to see anything new in the iPad - and instead hit out at limitations with the hardware such as a "non-standard" microSIM format and the lack of a "normal" USB port.

Apple's much-hyped iPad
(Photo credit: James Martin/CNET)

"Sorry Apple, I'm unconvinced," he wrote. "It's vaguely useful and cute but it doesn't seem to be a new product category to me, and the connectivity options look severely flawed."

Hardware limitations were also worrying Adam Leach, practice leader at Ovum. "The iPad, like the first versions of the iPhone, has a number of limitations (such as no camera and no multitasking capability), and it is tempting to believe that these will limit its success," he said.

"Apple will refine the iPad through OS updates and new hardware but still needs to deliver a compelling experience for the initial version of the iPad. It cannot rely purely on improvements that are not yet delivered to establish the product."

...or a beautiful product?

However not all analysts were so circumspect in their assessment of Apple's iPad. Stephanie Ethier, senior analyst at In-Stat described the iPad as "an impressive device", while Gartner analyst Van Baker, blogged enthusiastically on launch day: "There has been much speculation on what an Apple tablet would offer, and the company did not disappoint with today's announcement."

Describing the iPad as a "beautiful product" with a "beautiful display" - and noting its "very aggressive" price-point - the VP and research director for Gartner's retail and manufacturing industry advisory services added: "This product will define the tablet form factor for the market, and it sets a high bar for other manufacturers."

Price was certainly a plus-point for many analysts weighing up the iPad - as its $499 entry-level tag was significantly lower than pre-launch price rumours, which had touched on the $1,000 mark.

At $499 the device has the potential to "kill the netbook category - dead", according to Mark McDonald, Gartner group VP and head of research in Gartner Executive Programs.

"At a price point of $499 it is about as expensive as a higher end netbook and lower end PC. If all you want/need to do is surf the web, then this looks like a far superior machine that has great wi-fi capability," he said.

Wi-fi

The iPad's built-in wi-fi (with cellular connectivity as an optional and costed extra) and tablet form factor led many analysts to describe it as a device best suited for browsing media content indoors. "iPad looks more suited to home use than as a true 24x7 mobile device," tweeted Forrester principal analyst Ian Fogg. "I can't see people carrying them 24x7 like an iPhone."

"The dock is another reason (along with weight) that this looks better as a part-time out-of-the-home mobile device, not 24x7," he added.

Gartner's Baker also chimed in on this point. "The majority of users will find wi-fi adequate for their needs," he predicted. "As the product is most likely to be used in the living room, the classroom or the local coffee shop, and wi-fi is likely to be available in all these venues."

"I think the iPad will initially be best suited to wi-fi rather than 3G anyway," said TechMarketView director Richard Holway in his blog. "It's for browsing at home on the sofa or in bed...

...it's for reading stuff you have downloaded previously on the train or plane, it's for free wi-fi surfing in Starbucks (or MacDonalds!)."

iPad vs Kindle

The iPad's focus on e-books - a market already served by e-reader devices such as Amazon's Kindle - gave analysts much to chew over.

"A key aspect of the iPad proposition is Apple's iBooks application," noted Ovum's Leach. "The iPad's advantage over the similarly priced Kindle DX is that it provides a host of multimedia functions as well as e-book reading. Although this seems like bad news for Amazon, the iPad will certainly increase the market for e-books."

In-Stat's Ethier does not envisage the iPad "demolishing" Kindle sales in the short term either, however, contemplating the longer term impact of a reinvigorated tablet market on e-reader hardware, she concluded Apple's device may yet spell bad news for Amazon.

"The immediate impact the iPad has on the Kindle is that the iPad is going to ignite the tablet market. Therefore, the blur between tablets and e-readers starts within the year, and will impact the outlook for future Kindle, and all e-reader, sales," she said.

TechMarketView's Holway added: "The iBooks application that Apple announced is really fabulous - indeed it must have sent shivers through the boardrooms of Amazon and Sony (the two current leaders in ebooks)."

But Forrester's McQuivey at least was not prepared to write the Kindle's obituary just yet - instead seeing a window of opportunity for Amazon to hit back with something better.

"[The iPad] is a significant step toward finally making tablets respectable," he wrote. "But making tablets respectable should have been the least of Apple's ambitions. It had (and still has) the opportunity to create a new media experience in consumers' lives. As it stands, a quick, well-structured response from Amazon in the next version of Kindle could easily be a contender here."

Apple faces other challenges, too, beyond a new set of rivals - as Gartner's Baker noted: "Communicating the value proposition for this new category of device is complex by Apple standards, and it will take a little time for consumers to digest exactly what the iPad offers.

The end of the beginning for the tablet

However one analyst at least predicts the future is undoubtedly going to be tablet-shaped.

Writing in a blog posting, TechMarketView's Holway said: "Fast forward to 2015 (it took a good five years for the iPod to go ubiquitous, it will be five years before iPhone-type touchscreen smartphones are as ubiquitous as today's 'dumb' phones) and the iPad (or its look-alikes) will be everywhere too."

"By 2015, nobody will have any doubts [about tablets] and trying to tell someone that there was a time when people didn't get it will seem as weird as explaining that we once had computers with green screens, menus and no mice, a time when people could only make telephone calls from home, a time when you put film in cameras and waited weeks to see your photos, a time when music came on big black scratchy vinyl platters, when mobile phones could only be used for voice and text," he wrote.

In Holway's view Apple's iPad is merely "the end of the beginning for the tablet".

It will take a few years but "people will get it", he added.