Via the iPhone Platform (including iPod Touch), Apple has set the bar for mobile computing by seamlessly integrating computation, communications, and media across hardware, software, and service layers.
No less integral, Apple has significantly evolved ecosystem development models by cobbling together developer tools, media relationships, marketplace/e-wallet functions, one-click software distribution, explicit platform governance, and a simple, but compelling, approach to sharing revenue with developers.
But, the pièce de résistance has been a touch, tilt, sensor, and virtual keyboard-based user interaction model that has rendered the traditional physical keyboard plus WIMP-based model (i.e., windows, icons, menus, and pointing device) as so last century, the proverbial horse-and-buggy to Apple’s Model T.
The end result is that the iPhone has become the first truly personal computer; more personal to its owners than the PC ever was, a truth that bubbles to the top again and again when you talk to the 50M (combined) iPhone and iPod Touch owners.
Thus, the core thesis of this article is two-fold. One, that while Apple remains committed to cultivating its position in the legacy desktop /portable segment via the Mac, they understand that they will never be the leader of the PC market.
Two, given their dominance in mobile computing platforms, Apple will expand upon their iPhone strategy by attacking an “undefended hill” (an HP axiom) that’s less hospitable to desktops/portables; namely, the bag-carrying consumer (think: purses, backpacks, briefcases, and the like).
The Bag-able Device: from Living Room to Classroom, Café to Bus
First, a market-sizing question. How many tens of millions of people carry a bag wherever they go that is large enough to accommodate a bookish-sized device?
From a sniff test, would there be room for a really “phat” version of the iPod Touch in your backpack? Your kid’s? Would you make room?
Before answering, imagine that you’re kicking back on the couch, with a cappuccino in one hand and a Tablet in the other. After all, this is a device that is recline-able in the sense that you can comfortably use it from any position that suits you (it’s neither overly bulky or hot, and input operations can be performed from any angle you desire).
Moreover, owing to its relative absence of moving parts and exposed interfaces, the Tablet is also slob-friendly, a euphemism for saying that it’s not the end of the world if you are eating pizza while using it (less susceptibility to spills, sauces and greasy fingers).
In turn, this means that it’s kid-friendly since the dearth of moving parts also means fewer to break. On top of this, Apple’s governance model provides a more direct path for parental controls on what types of apps can be used, and for how long.
Taking the Tablet out of your bag, you instantly notice that this is a device that can support multiple modalities in a robust fashion. A bigger screen means truer multi-touch, richer interaction possibilities, and a personal home theater experience that simply rocks (especially, when wearing decent headphones). Plus, as iPhone has proven, this is no underpowered computing device. Skype me? Sure. Video chat? In a snap. Day planner? C’mon!
Now, imagine iPhone’s current gaming support scaling up to this device (not to mention the other two thirds of the 100K-app-strong App Store).
(Sidebar: I expect a straightforward upgrade path for developers to port their iPhone Apps to also run on the Tablet, offering tremendous platform leverage to the estimated 120K iPhone App developers.)
Moreover, given their iTunes foothold, how much do you want to bet that, coincident to the Tablet launch, Apple pursues a TV 3.0 play (aka, TV Everywhere) powered by a subscription service for music, movies and TV programming? In one fell swoop, the leverage of a TV 3.0 play could be extended not only to the Tablet, but to the Mac, iPhone, iPod, and Apple TV as well.
Who else can match that kind of end-to-end firepower, especially in light of Apple’s announcement that the iTunes/App Store Universe is backed by 100M active credit card-backed user accounts?
That’s also why Apple rebooting the book marketplace is such a given from where I sit (i.e., look out, Kindle).
A final note: while businesses/enterprises have been less central to the iPhone story to date, I think that the Tablet is a device that is tailor-made for verticals and VAR (value added reseller) channels, with Education, Health Care, Retail, and Field Support as obvious beachheads.
Flies in the Ointment: Avoiding the Tyranny of the Either/Or
So what could go wrong? Apple’s challenge is to ensure that consumers never feel like they are being forced to make a binary Either/Or decision between an iPhone, an iPod Touch, a Tablet, and of course, a MacBook.
Under the hood, managing this one touches upon core strategic decisions about form-factors, runtime capabilities, and functional symmetries/asymmetries between the different Apple device offerings (read more about Apple’s coming Hardware/Software Matrix decisions).
At the same time, some of this is market segmentation thinking, and allowing consumers to choose the level of integration, the type of computing model, and the depth of Apple-centric leverage that makes most sense for them.
Why? Because Apple’s overriding goal is to grow their portion of the consumer’s communications, media, entertainment ,and Engagement Time online, and in concert, their Portion of Spend for those services.
To be clear, though, Apple has already proven that they can navigate this one with the release of iPhone, and the related segmenting decisions relative to iPod Touch and iPod (if anything, the net-out has been a total Halo Effect). Hence, I am optimistic that not only will they successfully navigate this path with the Tablet, but that they have been planning for this transition for a long, long time.
As such, for Apple, a successful Tablet launch is not merely a fuzzy ambition, but rather, it’s in the bag.