iPad and Similar Tablets May Replace Laptops

Analysts at Goldman Sachs Group Inc. (GS) took some of the sting out of yesterday’s review of the iPhone 4 from Apple Inc. (APPL) from Consumer Reports magazine. The magazine said it could not recommend the new phone due to issues with dropped calls. Bummer.

Goldman saved the day, though, issuing a report on the future of the iPad and other tablet devices among corporate buyers. The implications of Goldman’s study could affect tech giants like Intel Corp. (INTC), Microsoft Corp. (MSFT), Hewlett-Packard Co. (HPQ), and Dell Inc. (DELL).

Goldman touted the iPad for five simple reasons:

1. The iPad focuses on consumption of information, not production of information. This is a near-paradigm shift in how computing devices are used. There are many more consumers of information than there are producers, and these devices are designed to make it easy to consume information. If HP and the others can match the iPad’s ease-of-use, the game will be on. Netbooks and laptops are still PCs, not specially designed media devices.

2. The iPad has tightly bound its apps content to its hardware. Apple leads by a mile here, but the Android operating system from Google Inc. (GOOG) is gaining. HP, which now owns its own operating system, and Microsoft, which keeps trying to break Windows 7 into the tablet market, are far behind and may never catch up.

3. The iPad, and presumably other tablets, have the capability to connect through WiFi or 3G networks. Netbooks/laptops rarely support 3G connectivity.

4. The iPad’s long battery life and virtually instant-on capability makes it the perfect machine for answering spur-of-the-moment queries like, “Who won the ball game?”

5. Consumers are far more likely to feel part of the tablet device’s ecosystem, thereby lowering the barriers to purchasing. If a customer can safely store payment info and instantly buy and receive an item, the customer is likely to buy more. Apple got this right, and its erstwhile competitors better get it right too.

Both Intel and Microsoft could be left on the sidelines in this new game. The microprocessors that run the tablets are low-power, limited function chips that also power smartphones. The operating systems are compact and, again, limited in function. Intel and Microsoft will eventually play here, of course, but it could be a long time before they’re a real threat.

Adoption of the iPad and other tablet devices in the corporate world is happening far faster than the adoption of the iPhone. And that’s really the whole story.

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Article printed from InvestorPlace Media, https://investorplace.com/2010/07/ipad-similar-tablets-may-replace-laptops-netbooks/.

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