Why the Apple Tablet is not going to save the electric sheep

I’m pretty sure it’s a scene in Blade Runner where Rick Deckard picks up a newspaper with motion video images on an otherwise textual page. That’s the sort of sci-fi that old school media executives have been raised on for the last nearly thirty years. And as the sales of their newspapers and magazines have fallen into a neo-noir landscape of their own, it’s likely their dreams of Jetsons tablets and throwaway electronic papers have become more and more fevered.

Blade Runner is set less than a decade away in 2019. E-ink and tablet technologies are coming along pretty nicely, and ebook readers like the Kindle are finding some real traction.

Now, this month Apple is set to announce its own Tablet scheduled for release in March. It’s the big brother to the iPhone rather than little brother to a laptop. It looks like being the first great tablet. According to the WSJ, it’s likely to have a 10 to 11 inch screen with full color and be bundled with decent wireless Internet rather than just 3G, and it’s likely to be priced between the Macbook at $999 and an iPhone. I’d guess $499 with a 24 month wireless Internet contract.

At the same time, Apple’s App Store has just reached three billion downloads, according to TechCrunch, (which sadly failed with its own attempt at a Tablet device, the CrunchPad). Three Billion. That’s just for apps for the iPod Touch and iPhone with a tiny screen on a device from a single manufacturer. The market for applications for a larger screen Tablet with a fast wireless connection is likely to be massive in the next 3-4 years assuming Apple gets similar cult product status with its Tablet.

I think it could. The device size looks right to me. Small enough to be portable, but large enough for usable web browsing, video and games. If it’s got that gently ruggedized feel of the iphone and you can throw it around a bit, and if it has a day’s battery life, it will be compelling.

It’s clear that media executives see tablet computers and e-readers as a panacea for people ditching their dead tree products. They’ve formed their own consortium to provide an “itunes for content” and produce physical e-readers for magazines and newspapers. Clearly they don’t want an Apple to dominate magazine and newspaper electronic sales like Apple does Music with itunes, and lose out on the opportunity to control the electronic distribution themselves.

But, as a recent Slate piece pointed out, they’re missing the point and assuming there will be a large market for both dedicated e-reader tablets, and for content sales for them, and they’ll be able to count the sales like electric sheep.

Most people aren’t going to buy a purpose-built device to read magazines, newspapers, or even in most cases books. Some very decicated customers and early adopters might and are as the Kindle shows. But most customers won’t.

Most consumers will want a general purpose device that can play games, browse the web, read ebooks, play music and video and run Apps. A big iPhone. Something like the Apple Tablet.

The driving use for these tablets is definitely NOT going to be reading books, magazines and newspapers. That’s a fantasy. It is one activity of many that people will perform, and I think one of the lesser ones, except maybe with older users.

The biggest uses for an 11in tablet with fast wireless are going to be live gaming, video applications, and web browsing.

And consumers won’t use a dedicated “itunes for content”. They just want to get content from the web, or maybe download publisher apps along with all the other games, apps and content from a general App Store, and videos and music from iTunes. That’s how I use the WSJ iPhone App today. (As an aside, it’s a great little App, but I think it’s a scam for the WSJ to charge a separate subscription to customers already subscribing to the online Journal. That’s the kind of fleecing your best customer behaviour that holds back paid content everywhere.)

Whether Apple can maintain its proprietary dominance over Apps on these devices remains to be seen. Apple has been incredibly sucessful at using proprietary control to establish premium pricing and provide good customer experience, and as a result established entirely new product categories very quickly. But over time with the Android, ChromeOS and other portable and mobile alternatives like the Nexus One covered by TechCrunch today, and developer dissatisfaction at lock-in and unfair policies with the App Store, you’d figure the mainstream market will open up.

In the meantime, I suspect media executives will be left dreaming about androids and electric sheep, while the rest of the world wakes up to Steve Jobs bringing down Tablets from the mountain.




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