Market & Technology
Market & Technology Trends The Ever-Evolving Tablet PC Market Apple continues to dominate the marketplace, while others scramble to catch-up and compete for attention from consumers While back-to-school shopping usually brings more traffic into big box retailers for the latest tech gadgets, DisplaySearch predicts that any high hopes of tablet PC makers for an overwhelming sales surge of these new computing devices will likely remain unmet during Q3'11. Apple is still the major player in the tablet PC market, having defined the category with its iPad. The iPad continues to dictate consumer expectations of what a tablet PC should be capable of, and Apple has set the pace for a wide range of applications with more than 90,000 currently available to iPad users. Additionally, Apple’s key differentiator when it comes to selling these emerging devices is that it can market its product from its very own retail stores. Due to its marketplace dominance, Apple has also been able to negotiate smaller shared revenues with its retail partners, translating to larger profit margins for itself, and perhaps more importantly, more overall flexibility on price versus competitors. Following Apple, there are essentially 20,8 WW Others three camps of competition that have formed (see figure below): companies primarily from the smart phone industry, companies primarily from the PC industry, and companies primarily from the consumer electronics industry. So far, these competitors have struggled with several challenges. The most significant challenge for tablet PC makers is the retail channel. Tablet PCs are a new class of computing devices that emphasize the user experience, software and services — selling points which are typically difficult to demonstrate in a retail environment. In addition, brands and retailers are still finding their way as they learn to market these new devices. Competition for limited space on retailer shelves is Q1’11 Tablet PC Market Shares 9,3 Samsung 1,8 Dell 2,7 Motorola 4,8 HP 4,0 3,5 3,0 2,5 2,0 1,5 1,0 0,5 0,0 1,0 Lenovo 0,9 Acer Group 0,7 Sharp 0,6 RIM 0,5 ViewSonic Source: DisplaySearch Quarterly Mobile PC Shipment and Forecast Report 3,7 another major challenge for tablet PCs. “DisplaySearch is tracking more than 180 different tablet models either announced or currently on the market,” said Shim. “This extensive list demonstrates the diversity of the market, but also shows that the value proposition needs to be clear in order to differentiate tablets from other devices such as smart phones, notebooks and mini-notes, and to clearly communicate to consumers what they can and can’t do with them.” Following the retail channel, the most significant challenge to tablet PC makers is not falling too far behind Apple, and in some cases, that translates to rushing products to market before they are ready. While Apple is already working on its third generation of the iPad, many competitors are struggling with platform immaturity on their first generation products. Just last month, a leading tablet PC contender, HP, announced that it would be exiting the marketplace after a brief and mediocre foray into the tablet PC business with its TouchPad product. And HP is not the only PC company that has struggled with this new consumer computing device. Acer parted ways with its CEO, reportedly over differences in opinion about the relationship between tables and more conventional consumer mobile PCs, notebooks 600 500 400 300 200 100 0 and netbooks. Most PC companies have noted that their mobile/notebook PC sales are down for consumers, acknowledging that the tablet effect is real. The Q2’11 DisplaySearch forecast (prior to HP’s announcement) estimates the tablet PC market at 50.3 million units for 2011, rising to over 181 million by 2015. While the total mobile PC market, including notebook PCs, is forecast to continue to grow as well, the scale of tablet growth can be judged by the total number of notebooks (not including netbooks) shipped in 2010, 167 million. Total WW Mobile PC Shipments (Ms) 2010 Mini-Note PC / Netbook Tablet PC Notebook PC 2011 2015 Source: DisplaySearch Quarterly Mobile PC Shipment and Forecast Report DON’T MISS the 2011 DisplaySearch Business Conference – 5 th September – at IFA! Information – www.displaysearch.com 14
Exclusive Interview ELECTROLUX DESIGN LAB ELECTROLUX President and CEO Keith McLoughlin said that all of the eight finalists in this year’s Electrolux Design Lab offer “eye-opening solutions to the brief, which aims to create appliances that offer intelligent mobility”. He added: “The final of Electrolux Design Lab takes place in London next week (September 7), marking the end of the ninth edition of the competition. It is amazing to study all of the creative ideas Electrolux Design Lab has generated over the years, while at the same time helping us to promote the fact that Electrolux is a company that focuses on products which are thoughtfullydesigned, easy-to-use and sustainable. “ This week marks McLoughlin’s first visit to IFA as head of the company “Germany and adjacent countries are extremely important markets for Electrolux. Therefore, IFA is extremely important in our marketing plan,” he said. “IFA is a great opportunity for us to meet with present and potential customers and consumers, and learn about their needs and thoughts. I am especially thrilled by this event, as it is the first important fair that I visit in the role of President and CEO of Electrolux since I took over in January 2011.” "Consumers are in the driver’s seat for change." IFA 2011 International Keynote Date: 2 nd September Time: 15:00 - 15:45 h Location: International Keynote Area, Hall 6.3 Electrolux Boss Hails People Power Keynote speaker Keith McLoughlin says consumers are driving change Keith McLoughlin President and CEO of Electrolux I n h i s k e y n o t e speech today, Keith McLoughlin, President and CEO of Electrolux, will outline a paradigm change in the way that people buy products. “It’s the people – not the companies – who drive change today,” he says. The consumer market is becoming globalised and is going online, having turned around the logics of business and innovation. Consumers are in the driver’s seat for change. No business plan in, say 1986, would have predicted that 25 years later the computer, camera, TV, calendar, record collection and shopping cart would be integrated into a regular phone — and that the bank and the postman would move in too. But this did happen. People changed their behaviour and made it reality and it fundamentally reshaped that industry. The manufacturers just had to follow. The music industry is another example. Once consumers discovered they could download music for free, they stopped buying CDs. Now, growing companies provide solutions with groundbreaking business models. The brown goods industry had to abandon some of its traditional equipment and move into technologies based on connectivity and mobility — because the consumers had already done so. In order to survive the producers had no choice. A third example is Interview by Richard Barnes the Internet itself. There was no CEO, R&D department, or growth strategy behind the Internet. Nevertheless, it now has billions of users all over the world. Why? Because the users developed it, set the priorities, did the marketing, made it grow and even developed it further, together. How does your Design Lab fit into this hypothesis? To meet this new business logic, it is no longer enough for the industry to conduct market research and consumer interviews. There needs to be an ongoing dialogue, but it is not just about observing consumers. We must also keep a close eye on macro and technology trends. Electrolux’s Design Lab generates innovative ideas and designs from design students all over the world, and the competition also helps us to continue the dialogue with our consumers about future design and product development. High Technology is increasingly creeping into your appliances. How far can this all go in the coming years? Yes, high technology is increasingly present in our appliances —for example the new AEG fridge with Dynamic Air technology, LCD touch displays and door alarms. This can go as far as the consumers wish it to go. The only limit is nature — energy, water, food and raw materials — and no matter where we look today, we get significant proof that resources are not infinite. Climate change presents a real challenge, but there will also be fantastic opportunities in finding sustainable solutions to people’s changed needs. Is this happening because people want it to happen? This is happening because it is possible. Consumers are getting closer to each other and communicate via social media. This means that they take the lead in product development. The rules of the game have changed from passive to active consumer involvement in business strategies. The ‘want-tohave’ factor is important. Products are expected to be replaced more rapidly by new, innovative products with good design, practical functions and sustainable properties. This calls for shorter product development cycles. This is good. Consumer-driven change is democratic and makes society and the economy more efficient. Happy consumers are good for the business. In the long run, this presents an opportunity for the industry. Hall 4.1 Stand 101 www.ifa-international.org IFA International • Friday 2 nd September 2011 15
