‘Tablet Tuesday’ happened this week, with Apple introducing its latest iPads and Nokia unveiling its first product in this segment ‘ poignantly enough, on the same day that future parent Microsoft started to ship its own Surface 2 offering. The requisite miles of column and blog inches were generated, especially about the iPad Air, but it’s all sounding rather labored now. Tablets are important as a category because they currently look like the most likely ‘post-PC’ form factor to replace the conventional PC, a trend borne out by plenty of research companies’ graphs showing the upward curve of the slate bisecting the downward line of the PC at an early stage. But they are increasingly uninteresting. So early in their life, innovation has largely run out in terms of technology, and even the disruptive business model moves of Amazon and Google in 2012 have not been repeated by anyone. Most new tablet features are borrowed from smartphones or even modern PCs such as ultrabooks ‘ the RetinaDisplay on the new iPad Mini, the imaging software in the Lumia 2520. Until the tablet is a device type in its own right, with its own creative impetus, it will be sold largely on price and brand.
And perhaps that very lack of innovative thought will condemn it to an early downturn itself. The smart device industry is on a continuum, which began well before the iPhone (perhaps with the Nokia Communicator or N Series, or even the Palm Pilot), and will carry on evolving well after the iPad, until the world settles on a few form factors with real staying power, like the notebook was. Apple is constantly being warned not to sit on its laurels, but to keep innovating, but the same goes for the whole sector, especially when it comes to tablets.
After all, a few years ago the netbook was going to be the PC killer, and become the dominant device combining computing, connectivity and media. Very few questioned that it would go from strength to strength, during its year or so in the sun, but in fact it quickly crashed out of the picture, You can argue that its decline was because of failures in usability, notably its low horsepower ‘ but the tablet has those too, particularly its shortcomings for keyboard-based work. That has spawned convertibles and hybrids, but they really look quite a lot like PCs, or the grown-up successors to the netbook, the ultrabooks. And some forecasters are already getting cooler on tablets ‘ NPD Displaysearch recently cut back its shipments predictions by about 9% a year between 2013 and 2017 (though it still thinks this year will see 30% growth over 2012, reaching 255m units and overtaking the notebook PC to command 60% of the mobile PC space).
Amid all this flux. only one thing is certain ‘ users want fully mobile, always-connected, lightweight, affordable devices with touchscreens, long battery life, workable keyboards and stunning user interfaces both for local and cloud functions. No form factor has come close to delivering that yet, except in the awkward mash-ups that are most convertibles.
So, as Larry Dignan puts it in his ZDnet column: ‘Let’s face it. Tech product cycles keep getting shorter. The new world order could be characterized by devices that are launched, take the industry by storm, sell hundreds of millions, if not billions, of units of compute for a few years and then flame out for something new.’ A continuing cycle of redesign like that would make new demands on supply chain flexibility and vendor costs, and while it might provide consumer choice it would also deprive users of the advantages of long-matured platforms. But it would certainly demand a higher level of innovation than is currently being seen in tablets.
Apple may feel it has the right to stop moving for a while, having set the new rules for the smartphone category and defined the touch tablet (and even prefigured the ultrabook with the MacBook Air). But that brings problems within its existing user base. Consumers, aided by operator subsidies, may clamor to upgrade their iPhone every year, but they are unlikely to do the same for a tablet ‘ which has a more PC-style replacement cycle ‘ unless there is an irresistible new function. Putting RetinaDisplay in the iPad Mini may attract a new customer, but will probably not be enough in itself to persuade an existing Mini user to upgrade any time soon. Therefore Apple needs to attract more new customers, and it has gone about this more rapidly with the iPad than the iPhone, introducing the Mini last year and, this time around, widening distribution channels and even the regional LTE flavors it supports.
However, Apple is caught on the horns of its perennial dilemma ‘ whether to reduce prices in order to win all those new users, but potentially at the cost of brand value and premium image? This is particularly difficult with tablets, which are still mainly seen as secondary, ‘nice-to-have’ devices and are less commonly subsidized by cellcos (especially as the majority are just Wi-Fi).
Apple has not got this pricing conundrum sorted out with the new launches., as seen with the new Mini. The smaller iPad should be the main driver of mass market expansion while its bigger cousin (now renamed iPad Air to echo another of Apple’s key aspirational offerings) retains the premium mystique. But Apple has stuck to its former strategy of positioning the Mini as a premium option in the smaller-sized tablet space, rather than going after the low cost devices of Google and Amazon. The new Mini comes with a number of high end features, notably Retina Display, but also a higher price tag – the entry level model is $399, whereas the previous Mini made its debut priced from $329, and the product now comes in at twice the cost of other relatively highly specified products like Google Nexus or the latest Kindle Fire HD.
Apple seems to be following the same route as it did with the new iPhones – keeping the lower end models as high end products within their categories, in order to preserve the Apple brand ‘mystique’, while using discounted older devices to go after real volumes in emerging economies. However, in the case of the iPad Mini, the older product’s price has been reduced by only $30, confirming that Apple is not yet ready to bring its disruptive power to the low end market, and risk devaluing its brand and profit margins.
Although the iPads made their usual flurry, many were disappointed that, as at the iPhone launch, Apple did nothing radical to assure the market that its magic remains, and certainly did not introduce any of the much-rumored new product lines such as iWatches, phablets or HDTVs. There is merit in continuous improvement of a successful range, and the power of continuity in brand and user experience. However, with Apple fighting declines in share price and market share all year, its conservatism is starting to look like a failure of innovation.
The iPad Air is an extension of the previous product, not a new departure. It claims to be the lightest full-sized tablet on the planet at one pound (28% lighter than the current iPad) and just 7.3 millimeters thick. It boasts iOS 7, the new A7 processor, improved battery life(10 hours) and just about every LTE band in use round the world. The Air has four storage options – 16Gb, 32Gb, 64Gb and 128Gb – and the 16Gb models are priced at $499 with Wi-Fi only or $629 with LTE as well. It will ship on November 1 in the US, UK, Spain, France, Germany and China, and over 20 other countries.
The 9.7-inch Retina Display has resolution of 2048 x 1536 pixels, while the A7 is surrounded by various coprocessors, notably the M6 for motion. Wi-Fi speed has been ramped up to a peak of 300Mbps using MIMO and there is also support for Bluetooth 4.0.
As with the iPhone 5S, the iPad changes add up to a slick and attractive device, which is maturing nicely like an old wine, but not providing any surprises, or any compelling reason to move on from previous models. Apple is given more latitude than other vendors because of its past record, and the belief among fans and the markets that it will, once again, pull a rabbit out of a hat. But patience is wearing thin, and neither the iPhone nor iPad launches have done anything to move the goalposts in this market.
Nokia, by contrast, has been innovating like mad over the past couple of years, though far too late to acquire itself a major role in the new smartphone market, or to avoid acquisition of its device business by Microsoft. It has brought genuine breakthroughs to market, notably its Pureview camera technology and Asha ‘smart featurephone’ platform, but without the mass market power of Android or the brand magic of Apple, it has been tied to Microsoft’s mast – and will soon become part of that company’s faltering post-PC strategy.
Microsoft will be relieved about that – if Nokia were to remain independent, it would now be offering a serious challenge to Surface in the tablet space, and there certainly isn’t room for two in the Windows Phone/Windows RT slate market. The Finnish firm is almost as late to the tablet race as it was to full smartphones, partly, it seems, to avoid fighting head-on with Microsoft – which returned the courtesy by staying out of handsets. Of course, once their deal closes the two ranges may be merged together, which will effectively tie up the nascent – or possibly dead-in-the-water – Windows/ARM tablet segment.
Nokia’s first Windows RT tablet is the Lumia 2520, which made its debut on the same day that Microsoft’s Surface 2 shipped commercially. The Finnish firm also launched two Windows Phone phablets and three Asha handsets. Stephen Elop – now EVP of devices and services at Nokia rather than CEO, in preparation for his move to Microsoft – told the Nokia World event in Abu Dhabi: “Clearly, with Lumia and Asha smartphones enjoying quarter-on-quarter volume growth in Q3 2013, that quality and value is resonating with consumers around the world.”
The 10.1- inch 2520 runs Windows RT 8.1 and a Qualcomm Snapdragon 800 2.2GHz quad-core processor and supports both Wi-Fi and LTE. It comes with a 6.7-megapixel rear camera with Nokia’s trademark Carl Ziess optics plus a 2-mp front-facing camera. Its screen is designed for outdoor usage with high peak brightness and low reflection.
Along with imaging, Nokia’s other main differentiation lies in its Here mapping and location technology. This is the basis of the Storyteller app, which allows users to place their photos in terms of location and when they were taken. Nokia also added a Power Keyboard which can convert the 2520 into a laptop and provide five extra hours of battery life. The tablet is expected to ship this quarter, priced at $499.
The 6-inch phablets, the Lumia 1520 and 1320, run Windows Phone. The higher end model has 1080p HD screen – Elop claimed this was the sharpest display ever seen on a Nokia device – and a 20-mp PureView camera with enhanced sensor technology and optical image stabilization. It uses the same Snapdragon 800 processor as the 2520 and has 32Gb of internal memory, expandable to 64Gb, and is priced quite steeply at $729.
The lower end 1320 is more like a stretched handset than a mini-tablet, and indeed has lower specs than top end Lumia smatphones to justify the big price gap with its big brother, and to target it at emerging economies. It costs $339 and comes with a 720p HD display, 5-mp camera and 1.7GHz Qualcomm dual-core processor. The regional segmentation of the two models is clear from the launch plan – the 1520 will initially ship in the US (via Nokia’s biggest ally there, AT&T), Hong Kong and Singapore, while the 1320 will launch in China and Vietnam (though not until early next year).
The company also announced three new additions to its Asha line, the 500, 502 and 503. The last of these is the first Asha to support 3G and, like the 502, has a 5-mp camera, while the 500 has just 2-mp. The 500 and 503 are available as single-SIM or easy-swap dual-SIM variants. The Asha devices will be launched in Africa, Asia-Pacific, Europe, the Middle East and Latin America in the current quarter with the 500 priced at $69, the 502 at $89 and the 503 at $99.
This is what Nokia does well ‘ turning out a wide variety of new devices, well-made and reasonably priced, with a couple of aspirational features (these days, the cameras) to detract from the generally workaday nature of the design. The approach works well in the midmarket and in Asha’s target spaces. It is highly questionable whether Microsoft will have the instincts or relationships to build on Nokia’s midrange channels and supply chain, and its probable failure will come as a relief to any vendor targeting first-time smartphone users and emerging economies ‘ the chief growth areas for the mobile industry, for phones and increasingly for tablets, and segments where an increasingly smart Asha could reap big rewards. Asha is a hundred miles away from iPhone and iPad, of course, but it showcases the kind of things Nokia does well when it doesn’t have to concern itself with a smart operating system. As growth shifts to that kind of product, Apple will have to bite the bullet at some point and adjust its cost/pricing/margin approach. But even to hang onto its premium markets, it is going to have to start innovating again soon, before the rapid cycling of the post-PC industry leave it stranded.