Microsoft, Intel to cede tablet market to Apple?

Apple logoIf the Apple tablet emerges as expected, this will be another big device market, following media players and smartphones, that the PC industry cedes to Apple.

The writing is already on the wall already for Microsoft and smartphones, as spelled out in a previous post and as documented in shrinking market share numbers.

That's not to say that Microsoft, Compaq (later Hewlett-Packard), and Intel didn't have a chance. Remember the Compaq iPAQ PDA that debuted way back in 2000, powered by an Intel StrongARM chip running an early version of Windows Mobile?

That device had a lot of potential. The operative word being "potential." An iPAQ could have been an iPhone. Or at the very least an iPod. And everybody could be drooling over iPAQs today instead of iPhones. Or using iPAQs instead of BlackBerrys. But of course things didn't turn out that way.

Fast forward to 2010 (January?). Apple announces a tablet and suddenly everyone wants a tablet. (Or iSlate, if you will.) And what have Microsoft, Intel, HP, and others been offering in the interim years when they had every opportunity to come out with a blockbuster tablet? Unattractive, bulky, half-baked convertible laptops that, let's put it this way, have not taken the PC market by storm.

So, here's the $64,000 question, uh, make that the $64 billion question. Why can't the combined R&D smarts, market clout, and overall technological resources of Microsoft-Intel-HP-Dell come up with a thin, sexy compelling tablet and/or media pad that will turn heads and convince the unbelievers (the average why-would-I-need-something-like-that consumer) that a tablet is a must-have product?

Answer: Because Apple will.

Here's a not unlikely scenario. Apple brings out the tablet/media pad, wows U.S. (and world?) consumers, sells a ton of units, Microsoft-Intel-HP-Dell follow suit with slavishly copied devices that don't sell very well comparatively. That's how the market for successful newfangled devices works these days. Apple creates the market and everyone else follows in a panic.

Then there's the Intel factor. Intel also wants to be a player in this space. But Intel and its coterie of PC makers can't get off the traditional-design laptop gravy train. Plus, as formidable a chipmaker as Intel is, it is still behind the Qualcomms and Texas Instruments of the world in building the power-efficient system-on-a-chip silicon that goes into smartphones and will likely go into tablets.

So, here's my question for Intel et al: How many people will be buying Netbooks or Intel-based MIDs (mobile Internet devices) in 2011 if Apple has a more compelling alternative? Answer: a lot less if the Apple tablet exists. And add Asia-based device makers offering tablets using an Nvidia Tegra 2 chip to that. A number of these tablets are expected too in 2010. In fact, Nvidia is already doing what Intel should have finished doing a long time ago: make a competitive system-on-a-chip that powers small devices. Intel had the chance to make XScale (what StrongARM eventually became) into something big for small devices six years ago. But it didn't. And now Intel is trying to reinvent the wheel by squeezing the upcoming "Moorestown" Atom chip into smartphones.

Intel, I'm sure you think Moorestown is a great idea, but it's a little late. Apple beat you to it by about three years.

Source: CNET

Tags: Apple, tablets

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