Apple's iPad is winning the enterprise tablet race without even trying

Apple doesn't have an enterprise sales force or support staff, yet it is killing the competition in enterprise adoption.

Apple doesn't have an enterprise sales force or support staff, yet it is killing the competition in enterprise adoption.

Apple outsold the competition five to one in 2010 and is expected to lock up 72 percent of the market in 2011, according to Barclay's Capital.

While Android, Palm, RIM and other tablet manufacturers court corporate IT buyers and support staff, the iPad has been winning over their users. Apple's tablet is walking in the front door of the Enterprise tucked under the arms  and stuffed in their shoulder bags of employees, according to Barclay's Analyst Ben A. Reitzes and Forrester Research analyst Ted Schadler. Reitzes and Schadler shared their iPad research in a Feb. 10 conference call with Barclay's Capital -- "iPad in the Enterprise: Opportunities and Challenges."

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Apple doesn't have an enterprise sales staff and it may not have to, Schadler said. Apple is the clear winner of what the Barclay's calls the "Consumerization of IT," where employees adopt devices earlier than the Enterprise, then use them to log in to the corporate network and business applications. The tail wags the dog as IT departments catch up to support the devices.

"It is very hard to determine consumer from corporate units given more and more employees are buying devices and bringing them into work in the consumerization of IT era and more and more corporations are beginning to subsidize the purchase of these devices."

Apple hasn't put a single salesperson on a corporate account, but the company hasn't ignored the Enterprise. Apple has been listening and adapting to corporate users behind the scenes, Reitzes said.

"IT learned from being late supporting iPhones, and hence is way ahead on its support for iPads with help from MobileIron, Good Technology, Sybase, RIM, etc. (about 25 enabling companies in total)... Security has long been a concern about Apple penetrating the enterprise, but according to Schadler, Apple has been addressing security concerns for three years and iOS4 has API hooks for mobile device management companies to help control devices. Because of this, security concerns are fading very rapidly..."

The iPad is the king of the consumerization of IT, besting even the corporate uptake of the Mac, Barclay's said. Apple sold nearly 15 million devices in 2010, five times the competition and Reitzes said he expects the company to sell more than 30 million , or 72 percent of the expected market, in 2011.

Neither Schadler, nor Barclay's mentioned Apple's announcement last week that it began production of "thinner, lighter" and feature-rich a second-generation iPad, which could freeze sales of Android and competitor tablets as buyers await a better, cheaper iPad.

The iPad is winning business users because it is winning the app race, Schadler said. Apps improve the device's "stickiness," and "should enhance customer loyalty/retention over the long term as "apps" personalize devices to levels that competitive imitations cannot match," Schadler told the Barclay's audience. The iPad has more than 60,000 native apps, something no other tablet manufacturer can match.

Three's Company

The importance of apps to device sales will ultimately limit the market to just three platforms, Forrester forecasts. Android, with its Honeycomb tablet platform and RIM, which can use its lead in the corporate smartphone market to grab a toehold in IT departments, according to the report.

"There is no way the world would tolerate seven platforms either, given there isn't enough developer focus to go around."

But that hypothesis could be unwinding already.  Schadler noted that Microsoft's partnership with Nokia, announced yesterday, could create a four-way race do dominate the app space and win the consumerization of IT.