Plummeting iPad sales rekindle fantasies of a hybrid device, a version that adopts PC attributes, something like a better execution of the Microsoft Surface Pro concept. Or not.
For a company that has gained a well-deserved reputation for its genre-shifting—even genre-creating—devices, it might seem odd that these devices evolve relatively slowly, almost reluctantly, after they’ve been introduced.
It took five years for the iPhone to grow from its original 3.5” in 2007, to a doubled 326 ppi on the same screen size for the June 2010 iPhone 4, to a 5” screen for the 2012 iPhone 5.
In the meantime, Samsung’s 5.3” Galaxy Note, released in 2011, was quickly followed by a 5.5” phablet version. Not to be outdone, Sony’s 2013 Xperia Z Ultra reached 6.4” (160 mm). And nothing could match the growth spurt of the long-forgotten (and discontinued) Dell Streak: from 5” in 2010 to 7” a year later.
Moreover, Apple’s leadership has a reputation—again, well-deserved—of being dismissive of the notion that its inspired creations need to evolve. While dealing with the iPhone 4 antenna fracas at a specially convened press event in 2010, a feisty Steve Jobs took the opportunity to ridicule Apple’s Brobdingnagian smartphone rivals, calling them “Hummers,” predicting that no one would buy a phone so big “you can’t get your hand around it.”
A smaller iPad? Nah, you’d have to shave your fingertips. Quoting the Grand Master in October 2010 [emphasis mine]:
“While one could increase the resolution to make up some of the difference, it is meaningless unless your tablet also includes sandpaper, so that the user can sand down their fingers to around one-quarter of their present size. Apple has done expensive user testing on touch interfaces over many years, and we really understand this stuff. There are clear limits of how close you can place physical elements on a touch screen, before users cannot reliably tap, flick or pinch them. This is one of the key reasons we think the 10-inch screen size is the minimum size required to create great tablet apps.”
For his part, Tim Cook has repeatedly used the “toaster-fridge” metaphor to dismiss the idea that the iPad needs a keyboard…and to diss hybrid tablet-PC devices such as Microsoft’s Surface Pro, starting with an April 2012 earnings call:
“You can converge a toaster and a refrigerator, but those aren’t going to be pleasing to the user…We are not going to that party, but others might from a defensive point of view.”
Recently, however, Apple management has adopted a more nuanced position. In a May 2013 AllThings D interview, Tim Cook cautiously danced around the iPhone screen size topic—although he didn’t waste the opportunity to throw a barb at Samsung [insert and emphasis mine]:
“We haven’t [done a bigger screen] so far, that doesn’t shut off the future. It takes a lot of really detailed work to do a phone right when you do the hardware, the software and services around it. We’ve chosen to put our energy in getting those right and have made the choices in order to do that and we haven’t become defocused working multiple lines.”
Sixteen months later, Apple’s Fall 2014 smartphone line-up sports three screen sizes: the 4” iPhone 5C and 5S , the new 4.7” iPhone 6, and the 5.5” iPhone 6 Plus phablet.
Is this apostasy? Fecklessness?
Remarking on Jobs’ quotable but not-always-lasting pronouncements, Cook gives us this:
“[Jobs] would flip on something so fast that you would forget that he was the one taking the 180 degree polar [opposite] position the day before. I saw it daily. This is a gift, because things do change, and it takes courage to change. It takes courage to say, ‘I was wrong.’ I think he had that.”
That brings us to the future of the iPad. In the same interview (in 2012) Cook expressed high hopes for Apple’s tablet:
“The tablet market is going to be huge…As the ecosystem gets better and better and we continue to double down on making great products, I think the limit here is nowhere in sight.”
Less than two years after the sky-is-the-limit pronouncement, iPad unit sales started to head South and have now plummeted for three quarters in a row (- 2,3%, – 9% and – 13% for the latest period.) This isn’t to say that the iPad is losing ground to its competitors, unless you include $50 models. Microsoft just claimed $903 million in Surface Pro revenue for the quarter ended last September, which, at $1,000 per hybrid, would be 0.9 million units, or double that number if the company only sold its $499 year-old model. For reference, 12.3 million iPads were sold in the same period. (I don’t know any company, other than Apple, that discloses its tablet unit volume.)
As Andreessen Horowitz’s Benedict Evans felicitously tweets it: “There’re 2 tablet markets: next-gen computing vision, where Apple has 80%, and, bigger but quite separate, the cheap TV/casual games device.”
Still, the concern remains. Does the iPad own 80% of a shrinking market, or can the Cupertino team reboot sales and fulfill Tim Cook’s The Limit Is Nowhere In Sight promise?
A hint might lie in plain sight at the coffee shop next door. We see laptops, a Kindle reader or two, and iPads–many with an attached keyboard. Toaster-fridges!
But here’s Craig Federighi, Apple’s senior vice president of software engineering, who is fond of dismissing talk of touch-screen Macs:
“We don’t think it’s the right interface, honestly.”
I find Federighi’s remark a bit facile. Yes, touching the screen makes much more ergonomic sense for a tablet than for a laptop, but in view of the turnabouts discussed above, I don’t quite know what to make of the “honestly” part.
Federighi may be entombed in the OS X and iOS software caves, but can he honestly ignore the beautiful Apple Wireless Keyboard proposed as an iPad accessory, or the many Logitech, Incase, and Belkin keyboards offered in the company’s online store? (Amazon ranks such keyboards between #20 and #30 in its bestsellers lists.) Is he suborning others to commit the crime of toaster-fridging?
In any case, the iPad + keyboard combo is an incomplete solution. It’s not that the device suffers from a lack of apps. Despite its poor curation, the App Store’s 675,000 iPad apps offer productivity, entertainment, education, graphic composition and editing, music creation, story-telling, and many other tools. As analyst Horace Dediu likes to put it, the iPad can be “hired to do interesting jobs.”
No, what’s missing is that the iOS user interface building blocks are not keyboard-friendly. And when you start to list what needs to be done, such as adding a cursor, the iPad hybrid looks more and more like a Mac…but a Mac with smaller margins. The 128GB iPad plus an Apple Keyboard rings up at $131 less than a 11”, 128GB MacBook Air. (As an added benefit, perhaps the Apple toaster-fridge would come bundled with Gene Munster’s repeatedly predicted TV set.)
On to better science fiction.
Let’s imagine what might happen next quarter when Intel finally ships the long-promised Broadwell processors. The new chips’ primary selling point is reduced power consumption. The Broadwell probably won’t dislodge ARM SoCs from smartphones, but a reduced appetite for electricity could enable a smaller, slimmer, lighter MacBook Air 2, with or without a double (linear) density Retina display.
Now consider last quarter’s iPad and Mac numbers, compared to the previous year:
Mac units grew 25% year-on-year, while iPads experienced a 7% decrease.
You’re in Apple’s driver seat: Do you try to make the iPad feel more like a Mac despite the risks on many levels (internal engineering, app developers, UI issues), or do you let nature to take its course and let the segment of more-demanding users gravitate to the Mac, cannibalizing iPad sales as a result? Put another way, are you willing to risk the satisfaction of users who enjoy “pure tablet” simplicity in order to win over customers who will naturally choose a nimbler Mac?
PS: John Kirk just published a column titled “The Apple Mac Takes Its Place In The Post-PC World” where he digs up a prophetic Bill Gates quote and explains the rise of the Mac as the weapon of choice for power users.
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