November 25, 2010

iPad Tablet Competition Reacting Fast, Expanding Market

When Apple introduced the iPod, there were already a number of hard disk MP3 players out there. It wasn't clear to everyone that the move into this market was a good one for the company, and its initial sales didn't hint at the juggernaut it would later become. This was due in part to its Mac-only start, as well as its need for Firewire, but also due to needing to publicly define a market, improving upon the established competition and convincing the public that this product was a must have. Over time, the public got it in a big way, and the iPod became a cultural icon, selling nearly 300 million units. Later competition to the iPod from Dell, Microsoft and others was clunky, and sales were comparatively pathetic.

iPod Sales Growth by Year (Wikipedia)

When Apple introduced the iPad earlier this year, they were not the first tablet PC provider, but they set the standard again - helping to transition the market from a geeky niche to a consumer product millions are lusting over, just as they had done with the iPod. This time, however, it seems the competition is faster to respond, and with better quality peers - backed by able competitors, starting with the expanding variety of Android tablets including the Samsung Galaxy Tab and MotoPad, to BlackBerry's PlayBook, which are taking the iPad's queues in terms of appearance and functionality, and getting out there not years after the iPad, but only a few quarters.
The BlackBerry PlayBook

Regardless of your personal preference for Android or the iOS, it seems apparent that Apple will have a battle on its hands that is better coordinated, and on more fronts, than it did with the iPod. They don't have two years to slowly define the market and get the product right.

On Monday, it was announced that Samsung's Galaxy Tab had sold 600,000 units globally in the first month it was available. This contrasted with the iPad selling more than a million units in the same time period. Knee-jerk horse race focused reactions, like this one from VentureBeat said things like "So just a month in, the first model in a new series of Android-based tablet computers is already losing to Apple’s market-defining iPad."

It's a good thing markets aren't made in thirty days and that brands know better to ignore bloggers when it makes sense. If markets were made in thirty days, Apple should have walked away from the first generation iPod. And it's also a good thing this isn't a zero-sum game. There are going to be a lot of people who have room for Android tablets who didn't have room for iPads, and there are going to be others, like my house, no doubt, that will have both.

Apple CEO Steve Jobs roundly mocked the first Android tablet entrants to the market, saying their 7 inch screens would do them in, contrasted with the iPad's nearly 10 inches. But his comments smack more of preemptive market protection, as Apple no doubt plans to offer a family of iPads, as they have laptops and iPods for the last decade. As someone who has the Barnes and Noble NOOKColor, which has an Android foundation and one of those smaller screens, it's clear to me there is room for both. The NOOKColor review is for a later time, but there is absolutely a space for a tablet that can be held one-handed, and with the variety of Android manufacturers that are out there, there will no doubt be a variety of designs consumers can choose from - not a one size fits all strategy.

Apple is on quite a roll. There is no debate, really, with the stock at all-time highs and the company expanding its corporate offices in Cupertino, purchasing land from HP, and their product line is fantastic. But they cannot rest easy. The market is being defined, and a single month's sales are just that - a single month's worth of data.