The Next Six Months

Wednesday, 9 February 2011

HP today announced their answer to the iPad: the TouchPad — a name that, not coincidentally, is drawn from those of two best-selling iOS devices. The hardware is very iPad-like — similar dimensions, similar basic gist. The software looks impressive: tasteful and well-designed, with a gesture-based interaction model. Way more appealing, and more cohesive, than what we’ve seen of Motorola’s Android-based Xoom.

But HP didn’t announce a price, and the ship date is “Planned availability this summer.” That’s too bad. I’m not a fan of pre-announcements, but I’m so impressed with the TouchPad’s software — just look at their nifty notifications UI, for example — that I’m trying to see things HP’s way. Presumably, they’re working on this as fast as they can. If they can’t ship for another six months, they can’t ship for another six months. I can see why maybe they’d want to announce it now, though. The next six months are going to set the foundation for the future of personal computing:

• The iPad is a huge hit for Apple, and they seem on the cusp of releasing the second-generation iPad models.

• Android 3.0 is optimized for tablets, and actual shipping hardware is, apparently, coming very soon.

• The RIM Playbook looks genuinely interesting, and, supposedly, is coming soon-ish.

The post-PC era has started, and the iPad blazed the trail. Look at who is following Apple’s lead in this direction: Google, RIM, Motorola, Dell, and Samsung. HP — the biggest PC-maker in the world, at least by unit sales — wants in, and they want everyone to know it.

One startling omission from that list: Microsoft. Their former hardware partners are heading off into the touch-computing future without them. We could have four competing tablet platforms six months from now — iOS, Android, WebOS, and Playbook — and not one of them is from Microsoft.

The growth potential of this market is too big to be estimated. I genuinely believe that these platforms are the future of the entire computing industry. The market for these tablets — and whatever other future form factors arrive running these OSes — will soon, collectively, be bigger than today’s Windows/Mac PC market.

I think Apple sees it this way, too. So I’ve been thinking about how Apple is going to manage the release of iPad hardware going forward.

(Brief Interpolation on My Recent History of Startlingly Accurate ‘Guesses’ Regarding Upcoming Apple Products: In the early years of DF, I’d generally write up my predictions for Apple announcement events the night beforehand, and my track record was, well, not that great. I tended to err on the side of optimism — predicting what I hoped for, not what I truly expected. In recent years, though, I’ve built a stable of good sources within the company, and, armed with solid information, my guesses turned into “guesses”. This was fun for a while, but I painted myself into a corner. Now when I make actual guesses, some people (not unreasonably) think I’m being coy and actually releasing information that I know. Henceforth, when I say I’m guessing, I’m really guessing. That includes what I’m about to guess about the iPad hardware release schedule.)

Apple doesn’t announce much about what they’re going to do in the future. But, they’ve become a very predictable company regarding the schedule for new hardware — at least in the consumer space. New iPods come in the fall, at an event in September, timed to hit full production for the holiday season. New iPhones are announced at WWDC in June and ship soon thereafter.

There are exceptions. The iPod Mini shipped in January 2004, for example. But for the most part, Apple’s schedule is predictable and makes sense — particularly the iPod schedule, given how popular they are as holiday gifts.

So where does the iPad fit in? Last year’s iPad was announced early, in late January, and went on sale at the beginning of April. Apple was willing to announce it months in advance because they had no competition, and because they wanted to give iPhone developers time to write native iPad apps. The lack of competition was why they were willing to pre-announce the original iPhone by six months, as well. Only with first edition models can you announce a product long before it’s available without dampening sales of the models currently on the market.

Now that the iPad is out, though, I don’t expect to see new hardware revisions pre-announced — at least not by more than a handful of weeks. Overall, I think the iPad fits most naturally into the same schedule as the iPods: where new hardware is announced and ships in September. The iPad was a massive hit during this past holiday season.

I don’t think April is a particularly good month for an annual iPad release. I don’t think it’s a particularly bad month, either, but it doesn’t make as much sense as September. April is four months into the new year, but still feels like “early” in the year. That leads to whispers and rumors during the holiday season that people should wait. Shipping new hardware in April adds another milestone to the iOS release schedule, too.

Thus, my gut feeling is that Apple will move the iPad to a September release schedule, alongside the iPods. But they wouldn’t want to wait over a year and a half from the announcement of the original iPad to announce the second one — not with these stakes, and not with so many serious competitors trying their best to catch up.

So, here’s my guess at Apple’s iPad plans for 2011:

• An iPad 2, fairly soon. Say, a March announcement, shipping in the first week of April. Faster, more RAM, maybe more storage, thinner and lighter, a front-facing camera.¹ Running iOS 4.3.

• iOS 5, announced at a developer event in March, shipping in June.

• iPad 3, shipping in September, announced at the annual iPod event. Running iOS 5.1, same as the next-generation iPod Touch.

How could Apple release a third-generation iPad just six months or so after the second one? Maybe it won’t be an actual next generation model. Maybe it’s more like an iPad 2.5, or iPad 2 Pro — a new higher-end model that sits atop the iPad product family, not a replacement for the iPad 2 models (which, of course, haven’t even been released yet).

Or: an iPad 2 HD. What if that’s the source of the conflicting reports of a retina display next-gen iPad? I am nearly dead certain the iPad 2 is going to have the same display resolution and size as the current iPad. I am not so sure at all, though, that there won’t be a double-resolution 2048 × 1536 iPad in 2011. Is that a technically aggressive release schedule? Absolutely. But Apple has invested $4 billion on some sort of unspecified components for future products. Tim Cook, during last month’s quarterly analyst call:

“And so in the past several quarters, we’ve identified another area and come to some recent agreements that Peter talked about in his opening comments. These payments consist of both pre-payments and capital for process equipment and tooling. And similar to the flash agreement, they’re focused in an area that we feel is very strategic. And so I’d prefer not to go into more detail about what specific area it’s in, but it’s the same kind of thinking that led us to those deals.”

I continue to think he’s talking about touchscreen display technology, and I think part of that might be spending huge amounts of money — billions of dollars — to bring retina display iPads to market at non-insane prices sooner than most people expect is possible.

I don’t know how to say this without sounding hyperbolic, but the iPad and iPhone have more market potential than any products Apple has ever released. They have the chance to be both the Microsoft and the Intel of the next generation of personal computing — profiting, wildly, both as the software platform vendor and hardware seller. Maybe my guesswork here is unrealistic, and driven more by what I’d like to see than what I should actually expect. But I’m certain that Apple sees the potential and the high stakes. They’re not going to leave any gas in the tank pushing the iPad hardware specs forward as fast as they can.