One of Apple’s most interesting marketing slogans was “Think Different.”
Steve Jobs purposely used this phrase to get people’s attention (some have questioned whether it uses correct grammar or not) and drive home a message about looking at the world from a different perspective. In this case, Jobs was pushing one of Apple’s key ideas that people can change the world. And if you know anything about Apple’s history, you know that Jobs and his team believed Apple’s own mission was to use technology to change the world.
To Apple’s credit, their technology has been world-changing in the sense that products like the iPod, iPhone and more recently, the iPad, have made technology easier to use, easier to access and delivered personal computing in new ways to people of all walks of life. In fact, the iPad is literally redefining what personal computing is about and, along with the iPhone, has succeeded in making computing extremely personal.
While the iPod and even the iPhone have been groundbreaking in their own right, it is perhaps Apple’s iPad tablet that may have the most profound impact on the world of personal computing since it is the first computer that is truly portable and easy to carry with you everywhere you go. Yes, the iPhone and smartphones are more portable, but because of their small screens, their computing capabilities are limited. But with their larger screens, the iPad and similar tablets deliver much of the power of a laptop (minus the keyboard) and almost as much flexibility as you can get from bigger portable computers — but in a much smaller package.
Tablets are on track to probably be the most ubiquitous portable computers we will have in our homes and offices in the future. But to see this future, we need to “think different” about them. Today we see tablets like the iPad and similar ones from companies like Samsung, Acer and others as being operating system (OS) specific and brand specific. That is today, but in the future, that may not be the case.
If you look at any tablet when turned off, what do you see? It’s a blank screen. In this state, it is pretty worthless. But when turned on and connected to apps and the Internet, it comes alive and has great value. Many people will be willing to pay to have a specific OS and brand if they get extra value from what these brands offer them. But there is another scenario that could possibly be quite interesting for the mass market.
Because of my company’s consulting work, we have around 10-12 tablets hanging around the office or in our homes at any given time. Recently I found that I had about six of them around my house. They ranged from iOS-based iPads, Android-based tablets and even a Windows 8 pre-beta test unit, and they were in different rooms in my home for various reasons. One was at my bedside, one in the kitchen, one in the family room, one on the coffee table in the living room and two in my study.
At various times when I needed to use a tablet, I just picked up the one closest to me at that time. And while all had different operating systems and apps, they all had one important common denominator: a web browser. Multiple surveys show that when it comes to tablets, 50% of the time spent on them is using the tablet’s web browser.
Now think about how many apps you use that also have web app versions: apps like Gmail, Facebook, Twitter, Pinterest and others. While localized apps are great, if you have a connection to the Internet, the browser apps will work just as well. Yes, there will be apps like games and others that will work best on dedicated OS models, but web-based tablets could represent the real future of tablets, and they will be so cheap you could have one in every room of your house if you wanted to.
The reason they will be so cheap will be because of something called subsidization. We already have a good example of this with Amazon’s Kindle Fire tablet. The Kindle Fire sells for $199, but sources tell us that the bill of materials (BOM) for the Kindle Fire is at least $215. Amazon is willing to sell it at $199 price because they expect a Kindle Fire buyer to purchase perhaps at least 10 e-books, rent at least five movies and buy various products from the Amazon store that the Amazon can amortize against the actual cost of the tablet and actually make a profit on it.
But Amazon doesn’t have a patent on this idea. For example, Walmart has many of the things needed to do what Amazon does: an e-commerce store for all of their products, digital movie rentals, and digital music sales. And in Walmart’s case, they also have the physical storefronts to back this up. They may count on the fact that their users will buy even more products from them if they own a Walmart tablet that makes it really easy to buy e-books, music, movies and products from their online store. They can also use it as an advertising vehicle for special offers. And in Walmart’s case, maybe they sell their own subsidized tablet for $99 — or in some cases even give it away for free with special promotions.
Take Proctor and Gamble as another example. They have over a hundred products they would like to sell you through their retail partners. What if they could get a reasonably priced P&G tablet built and branded for them, and then use it to drive promotions to users to help subsidize part of the cost of such a tablet. From the users’ standpoint, the web apps drive their broad content and apps needs, but by offering the tablet at a very discounted rate, P&G would have a captive audience willing to get ads in exchange for the discounted tablet.
Now this won’t happen anytime soon, since for this to work, component prices will still need to come down and inexpensive ubiquitous connectivity will have to be in place so the tablets can work inside the home as well as when away from Wi-Fi connections. Even with these low cost options, a product like Apple’s iPad will continue to thrive because of its versatility. And of all the options out there, it would perhaps be the top of the line model users could choose from.
But if you “think different” about tablets, you might be able to see a future where families could have four or five scattered around the house at their disposal — some subsidized by various vendors so that owning more than one is the norm. And while the operating system may still be important to handle localized apps for some users, the most-used feature will be the web browser and web apps tied to the cloud where most of your personal digital life will reside.
That is at the heart of Google’s vision for its own tablet that’s rumored to come out in July. I expect it to be low priced and to some degree subsidized by Google ads tied into their web apps like Gmail and search, which will be key to the Google tablet experience.
The bottom line is that today’s tablets are great and thanks to Apple, the role of tablets in our lives is being broadened now. But if you “think different” you will see that the tablets of the future will just be screens that use web browsers to connect us to everything we need from the cloud, and thanks to subsidization, they’ll be cheap enough that each room in our homes can have one. When you need to use a tablet, you’ll just pick up the one that’s closest to you.
Tim Bajarin is the president of Creative Strategies Inc., a technology-industry-analysis and market-intelligence firm in Silicon Valley.