On January 27th Apple is expected to announce its new tablet, although no official confirmation has been given whatsoever. The Apple policy is to develop new products in complete secrecy and than, when the product is announced, take the world by surprise. Apple has brought game changing products in the past and the surprise effect at its announcement has been significant. Then, over time, people know they can expect and start anticipating on future Apple move which results in a huge circuit of rumor and speculations. Part of the fun of being an Apple Fanboy is taking part in this circuit and think about my own expectations.
The name
MacRumors discovered that Apple owns the domain name iSlate.com which might, just might, give an indication of the name of the new tablet. Slate is not a very international word, I had to search for its meaning. It translates to “lei” in Dutch, “Schiefer” in German, “ardoise” in French. It is an old-fashioned concept as well.
As a child I have used a slate at primary school, near Geneva, both in Switzerland and in France. But in the Netherlands we didn’t have slates, we wrote on paper. Wikipedia says it was used in the 1800s to allow children to practice writing and it appears to have become obsolete in the 20th Century. Still, I keep warm memories of the device. We wrote on it with slate pencils that were just like normal pencils but with a white chalk like substance in the middle instead of the normal black graphite. These slate pencils allowed to write in the same size as you would on paper so on a 10 inch slate you could get a whole page of text. It was used for various things like calculation or dictation and then, when you finished your task, the master would erase it with a wet sponge. Just like other childhood memories there is an aura of magic around the concept, it belongs to a time and environment when I still believed in fairy tales.
Instead of the English “slate” I try and search for the French “ardoise”. To my surprise, and despite the notions of obsolescence, the product is currently available for just €2,26 at Bureau Rhone-Alpes, established in Lyon, France. So maybe they are still used today. It would make kind of sense because Geneva and Lyon are in a mountainous region where slate stone is a natural resource.
Would such an old-fashoned concept be the right match for naming the most innovative product we talk of today? I think it does. The old concept allows to establish an emotional binding which is extremely important for an innovative product. And it refers to Magic Slates in ancient fairy tales that do exactly the kind of thing you might expect from an Apple tablet.
A counterintuitive move
In the tech world Apple is the leader with new, innovative ideas, Microsoft is the follower who follows what Apple has thought out and who is desperately unable to come with original ideas of its own. Yet Microsoft has been first to experiment with a tablet, as RoughlyDrafted Magazine points out: “It was almost ten years ago that Bill Gates demonstrated his vision of Tablet PCs at Comdex 2001″ But it went nowhere: “Microsoft’s Tablet PC was too expensive to compete with conventional laptops, too big to be much more mobile than a conventional laptop, and too slow to be useful in place of a conventional laptop.” So, long time after Bill Gates has unsuccessfully been struggling with the tablet PC form factor Steve Jobs would do the exact same thing?
It could be a matter of timing. Surely technology today is more advances and it will be possible to make a tablet that is smaller, cheaper and faster than the Microsoft experiments. Microsoft was too early and didn’t acknowledge that they were not yet able to meet the requirements for the intended use of a tablet, that it simply wasn’t portable and responsive enough to conquer consumers hearts. However, I think there is more than form factor and tech specs to look at.
Supply chain
Technology is not about solitary devices. Gadgets that only refer to themselves as a reason for existence (with impressive spec and feature lists) are bound to end up as crap on the bottom of a drawer. Technology can only be successful when it connects somehow to its environment, it should be part of a supply chain that does useful things. With new technology the supply chain does not yet exist or has to be fundamentally revised. Organizing a supply chain is way harder than engineering a standalone gadget.
A tablet is not useful because its high screen resolution and fast processor (although these must be good enough), it is useful because you can access useful information or interaction right where you are. Today no content is available for a tablet, the available content is optimized for the current distribution channels, mainly print and TV. It is not so simple as it seems, there is a whole ecosystem out there. Content providers must, somehow, be compensated for their efforts. The information must be, physically or electronically, transported to the consumer. For content creation, information transport (and all other aspects) there is a balance between price, earnings and quality level and the ecosystem can only function when a right balance is found.
A challenge lies in the fact that consumers are reluctant to pay for nonphysical services. In the traditional print market customers pay for the paper even though the service they in fact consume is the information on the paper and the fact that it has been transported to them. In electronic media payment has always been problematic, TV mainly thrives on ad revenues, not consumer payments and Internet is moving in the same direction. There is a problem of understanding, people attribute value to physical things and perceive information as ‘free’. There is also a problem of trust, without the transfer of a physical object how can the buyer know he will actually get what he is expecting and how does the seller know the buyer isn’t going to distribute pirate copies?
Connecting to content
With the iTunes Store Apple has been the first successful party to offer a payment model for entirely non-physical content. In order to obtain this success it has hugely invested in both understanding and trust. In order to create understanding Apple has used all kind of physical metaphors, like the brushed metal look of the iTunes player and showing of album covers. It also put significant effort in obtaining a balance of trust with a model where both content-providers and consumers have some protection and some freedom of movement. After success in selling music Apple surpassed itself with the unprecedented growth of the iPhone App Store. So it is clear that, while other parties in the market are stubbornly focussing on device properties, Apple does have a vision on the supply chain and is likely to add yet another type of content to its thriving business.
The start of the iTunes music store has been slow, mainly because it has been difficult to convince music labels. Today iTunes is the most important way to earn money with music but music labels still are not so satisfied because they feel they have been forced to give up revenues. Apple has been surprisingly unsuccessful in TV business. TV companies have seen what happened in music and prepared themselves to resist the iTunes model in their business because they feared their revenues might also leak away. Moreover their business mainly lies in the ad supported model and it would be a huge step to rethink to the user-paid iTunes model.
It looks like the new Apple tablet will be targeting a whole new group of content providers: print publishers. Now is the right moment to do so. The print business is increasingly eroding due to the growth of the Internet with its ‘free’ (ad supported) information. In the past decade publishers have been experimenting with internet while still relying on their old sources of revenue. In future these sources will increasingly dry up and publishers are in need of a replacement. They are much more likely to embrace the iTunes model than TV stations did.
In fact there are already some signs the print industry is embracing the tablet as the above YouTube video and this link to Mag+ magazine shows.
Making connections
But content is not enough, the information needs to be transported as well. Up until now iTunes has hitchhiked upon the desktop PC internet connection while portable music depended upon previous download. However, for print content this might not be enough. When you are on the go and have time to read you want to know the latest news, not the news of yesterday – or whatever time your device was last connected to your PC. You want a live internet connection, not only wifi at home but anywhere. That’s where the telecom carriers come in.
Just like content creators, telcos have the burden of selling a service that is essentially non-physical. And while publishers sell paper that represent the intangible value telecom business has been much concentrated around the telephone devices at the end of the line. In the last 20 years European and American markets have developed differently. In Europe legislation has forced a separation between the telecommunication hardware market and telecommunication services market. In America the old situation persists but as hardware becomes smarter and gets more and more functions beyond voice communication this situation becomes increasingly unsustainable. Jon Stokes writes in Ars Technica:
“Right now, with specific phone models available only on specific carriers, consumers must pick a carrier and phone combination. Many consumers actually pick a phone first, and then pick their carrier based on it (witness the mass customer defection to AT&T when the iPhone was announced). [...] This is bad for consumers, but it’s great for carriers. Carriers don’t have to compete solely on network quality; rather, they compete based on a combination of network quality and phone selection.”
When Steve Jobs announced the iPhone in 2007 it was exclusively tied to AT&T so superficially it seemed Apple was following the American practice. However, the iPhone is built to the European GSM standard and contains a SIM-card. Soon thereafter (while the iPhone was only available to the American market) the first surprise, at least to American commenters, happened: tourists from all over the world started to buy iPhones in America to et them unlocked and use them on their GSM network at home. It happened to such an extent that the New York Apple stores got out of stock. When Apple started selling abroad, and started to make exclusive arrangements with foreign carriers as well, a second surprise happened. In some countries Apple was legally forced to either sell unlocked phones or to offer the iPhone through more than one carrier and in these countries the iPhone market share actually grew significantly faster. Finally a third surprise, now at home. The iPhone came with an all you can eat AT&T data connection which of course was a good idea in order to promote mobile internet use. But it also meant the absence of any market regulation, either by increased prices to slow down demand or by increased revenue that encourages investment in more capacity. Like an old-fashoned communist economy the iPhone has started to suffer from shortages in bandwidth supply.
The direction is quite clear, in order to achieve a thriving ecosystem based upon a supply chain where all parties are happy to participate, the new tablet needs good interfaces, not only to content but also to telecom suppliers. The combination of wifi access at home and a carrier connection elsewhere on the iPhone is working fine, exclusive arrangements with carriers are not. Google is now making the step of offering Nexus One unlocked. Nexus One is working only on GSM, limiting the number of American carriers, but new chipsets that can connect to both GSM and CDMA networks are on their way.
Just like time is ready for user-paid internet content and thus to create a mature 21st Century content market, time is ready for a mature telecom market as well. I expect the new tablet to come with some kind of cellular data connectivity but without exclusive carrier ties. Just like the Nexus One it will come with an empty SIM tray.
Predictions
So, to participate in the grand Apple Tablet prediction game, here’s my guess:
- January 27th is about the new tablet
- This tablet is called iSlate
- Apple cooperated with some major publishers who are providing launching content
- App and content purchase via iTunes store
- No exclusive deals with content providers, it’s left up to the customer which content fits best and pay for that (…which is pretty obvious)
- It will run an OS equal or very similar to OS-X Touch
- Wifi and cellular data connectivity (probably 3G, just like the iPhone)
- No exclusive deals with telecom providers, it’s left up to the customer which arrangement fits best and pay for that (…which is,if you think about it, obvious as well)
- Empty SIM tray
[...] Magic Slate [...]
[...] the website was more suited. But did I really want to know? I knew what was coming, I knew the Magic Slate would offer improvement over both the iPhone and the MacBook Air, I knew it would be great… [...]