Apple's iPad to 'kickstart' tablet market

By Maggie Shiels Technology reporter, BBC News, Silicon Valley

Industry watchers say Apple's long-awaited iPad tablet could reverse the fortunes of the tablet PC industry.

Microsoft introduced a tablet computer in 2001, but it failed to catch on.

However, advances in touchscreens and wireless technology mean that the market could now be right for products such as the iPad, analysts said.

"Tablets have been around for a long time and tablets have failed for a long time. This is a winning product," said analyst Van Baker of Gartner Research.

"I was nervous when they first started talking about this and thought it would be nothing more than a giant iPhone.

"It's hard to argue against. I can use it in the living room, the classroom, for light work and at the coffee shop," Mr Baker told BBC News.

'What need?'

Apple said its aim was to try to create a third category of product that sits between a laptop and a smartphone, which is the traditional interpretation of a tablet computer.

But Mr Jobs pointed out that in order for consumers to buy one, Apple's iPad had to change perceptions and offer a different experience to other devices."

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Apple did what they needed to do. They gave this form factor a reason to exist," said Mike Gartenberg, vice-president of strategy and analysis at research firm Interpret.

"They answered the question immediately 'Why do I want the iPad?' And they showed why. They are leveraging the entire Apple eco-system.

"Everything they have done up until now is in this device - the iPod, iTunes, multi-touch, the applications. And then they added new features like the iBook store and productivity," Mr Gartenberg told BBC News.

"I think this is going to be a very successful product for them and exceed expectations."

Blogger and Apple watcher MG Siegler of TechCrunch had a different take.

"Is it a must have? The quick and dirty answer is: for many people, right now, no.

"Unlike the iPhone, which filled an already well-established need, there is no existing need the iPad fills."

'Game over'

The tablet market has until now been regarded as a niche.

Endpoint Technologies noted that by the end of 2010 about four million tablets will have been sold - a 1% market share.

Gartner believes with Apple now entering the fray, that figure will rise to around nine million.

Piper Jaffray agreed and doubled earlier predictions for Apple iPad sales to between three and four million.

Mr Gartenberg said that he believes Apple may kick start the market, allowing other manufacturers to follow.

"Small niche markets grow into big important ones like the iPod. Here Apple created a category, they didn't invent the category but they redefined it and made it useful as they did with MP3 players and smartphones."

During the iPad launch, Apple said that it had recently sold its 250 millionth iPod.

One analyst predicted future sales of the iPod will be cannibalised by those of the iPad.

"The gadget is a premium mobile device, not a computer; as such we see some iPod Touch buyers stepping up to the iPad, but consumers looking for an affordable portable computer will likely stick with the MacBook line up," said Gene Munster of Piper Jaffray.

Analysts also believe the gadget could cannibalise the e-reader market, currently dominated by Amazon's Kindle and Sony's Reader.

Deloitte has said that it believes that for every "million net tablets sold there will be a corresponding impact on e-readers".

Price point

Although the device has received rave reviews form some quarters, others have pointed out some of its failings.

For example, it does not support multi-tasking, the ability to have more than one application open at any one time.

Also absent is a camera and Flash, the ubiquitous software that handles video and animation on the web.

Get a closer look at the iPad Enlarge Image

"The lack of a camera might have been something Apple did as a trade off to keep the price low," Dean Takahashi of tech blog VentureBeat told BBC News.

A 32GB iPad will cost $599 (£376) and a 64GB will cost $699 (£439). Apple has given no hint about exact UK prices and final costs may be higher than direct conversions suggest.

All models will be wi-fi enabled but users can pay an additional $130 (£81) for a 3G version.

The wi-fi version of the iPad is expected to go on sale worldwide by the end of March while the 3G version will come out at the end of April.

One person who aims to be first in line to purchase one is self proclaimed Apple fanboy and actor Stephen Fry.

"People will look at it and say it's a big iPhone that took Alice in Wonderland's magic potion but it is so much more than that. It's a mobile device, a communications device, a gaming device.

"I am in love with it and am drooling in anticipation at being able to buy one. I want to fondle it and lick it. In fact I am going to run away with it now," joked Mr Fry.

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