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iPad:            Raven Zachary
                     Small Society
One Year Later
                    Web 2.0 Expo
                   30 March 2011




                      Photo by Willis Lim
@ravenme




Raven Zachary
 Find vehicles

 Reserve

 Unlock and honk horn

 Extend reservation

 Save favorites




      Ideas              Wireframes   Design


Before a line of code is written...
A Show of Hands   Photo by Nick Bilton
Photo by Jeff Christensen
Elisha Gray   Teleautograph


                   Photo from Oberlin College Archives
Photo by Tobias Hilsen
 An utter disappointment and abysmal
   failure. (Orange County Design Blog)
  Consumers seem genuinely baf鍖ed by why
   they might need it. (Businessweek)
  Nothing more than a luxury bauble that will
   appeal to a few gadget geeks. (Bloomberg)
  Insanely great it is not. (MarketWatch)
  My god, am I underwhelmed. (Gizmodo)
                       Source: David Pogue, New York Times




iPad Announcement Commentary
Photo by Dan Nguyen
iPad: One Year Later
Photo by Randy von Liski
Is there room
   for a third
  category of
 device in the
     middle?
Yes, but...
Existing    New     Existing
Market     Market   Market
Far better at
 some key
   things
Web
 Email
Photos
Video
Music
Games
Books
  etc.
Nobody needs a tablet. So why
  are we gobbling them up?

     - Brian X. Chen,Wired.com
   Video
   Web browsing
   Email
   Periodicals
   eBooks
   Games
   Social Networking
   Education
   News
   Music


    iPad Usage Survey, wired.com
iPad: One Year Later
iPad: One Year Later
iPad: One Year Later
iPad: One Year Later
iPad: One Year Later
iPad: One Year Later
iPad: One Year Later
2010 iPad Unit Sales Estimates
                            15



                            12
Millions of Units Shipped




                            9



                            6



                            3



                            0
                                 ACTUAL   Jon Gruber   Various   Forrester   Jason Snell   Andy Ihnatko


                                                                                    Sources: Various
The tablet is now a proven
 market. This is not a fad.

  ...and this market is
impacting other markets.
Netbook Growth
Laptop Growth
Device Cannibalization
Tablets in Context
   14.78m sold in 2010, during 9
           month period (April on)
          Fastest selling consumer
           electronic device (before the
           Microsoft Kinect)
          More than every Tablet PC ever
           sold
          $9.5bn in revenue for Apple
          Post-PC Era
          Part of the iOS larger ecosystem



iPad Success in 2010
Apple iOS Units (in millions)
                            200

                                                                      iPhone                    iPod touch                   iPad

                                                                                                                                                                 14.79
                            150
                                                                                                                                                                  60.2
Millions of Units Shipped




                                  160+ million iOS devices and growing                                                                                   7.46
                                                                                                                                                         47.2

                            100                                                                                                                 3.27
                                                                                                                                                42.7

                                                                                                                                       38.0                       89.6

                                                                                                                              33.0                       73.4

                                                                                                                                                59.3
                             50                                                                                      20.0              50.9
                                                                                                            17.0              42.1
                                                                                                   15.0              33.4
                                                                                         13.0
                                                                                                            26.4
                                                                                 7.5               21.2
                                                                                         17.4
                                                                       5.4      13.0
                                                     3.2      4.3
                              0                      3.7      5.4      6.1
                                   0.3
                                    0       1.0
                                            1.4
                                             0        0        0        0        0        0         0        0        0        0        0
                                  Q2 07   Q3 07   Q4 07   Q1 08   Q2 08   Q3 08   Q4 08    Q1 09   Q2 09   Q3 09   Q4 09   Q1 10   Q2 10   Q3 10   Q4 10




                                                              Sources: iPhone & iPad - Apple
                                                    iPod touch - estimate by Raven Zachary and Apple
Apple iOS Market by Device


                                 9%




                                                    37%           iPod touch
                                                                  iPhone
160+ million                                                      iPad
iOS devices
and growing

                        54%




                         Sources: iPhone & iPad - Apple
               iPod touch - estimate by Raven Zachary and Apple
Portable Gaming Market (Total Units Sold)
                              200
                                     Since
                                     2007
                                    (2008)

                              150                                Since
                                                                 2004
  Millions of Units Shipped




                              100

                                              Since
                                              2005

                              50




                               0
                                     iOS     Sony PSP         Nintendo DS


                                                      Sources: Apple, Nintendo, Sony
App Store Apps by Platform

400000


            350,000

300000
                      280,000




200000




100000


                                43,535
                                             16,121     10,000
     0
            Apple     Google    Nokia        RIM      Microsoft


                                         Source: Various, Q1 2011 data
App Store Tablet Apps by Platform

70000

        65,000



52500




35000




17500




    0                                  0         0
                   19       0
        Apple    Google   Nokia       RIM    Microsoft


                                  Source: Various, Q1 2011 data
Android Marketplace Tablet Apps

                  Electrum Drum
  CNN App                                Speedx 3D        Grocery iQ
                  Machine/Sampler



Vendetta Online    Google Body           USA Today        WeatherBug



    Flixster       AccuWeather         Thumb Keyboard      DrawFree



 TouchDown           DueToday              Opera        Draft Manager 11



 QuickOf鍖ce          NY Times              Conqu



                                    Source: Justin Williams, carpeaqua
 Thinner. Lighter. Faster.
       FaceTime. Smart Covers. 10-
       hour battery.
      2x CPU, 9x graphics
      Video mirroring
      Evolutionary, not
       revolutionary, but...
      Retained price points ($499
       to $829)



iPad 2 Overview
 Low-res cameras
        No retina display
        Out of the box activation
         not available
        18 con鍖gurations - color,
         network, storage
        No Flash support
        No 4G network support

iPad 2 Complaints
   Too early to tell
          Only 20 days on the market in
           the US
          Only 6 days in 25 additional
           countries
          500k units 鍖rst day estimate
           (source: Gene Munster, Piper
           Jaffray)
          Mall of America: line 3x
          5th Ave Apple Store NYC: line
           1.5x
          Demand > Supply



iPad 2 Sales Data
iPad 2 isnt just the best tablet
 on the market, it feels like the
  only tablet on the market.

     - Joshua Topolsky, Engadget
Thats because the tablet
wars have not yet begun.
Global Tablet Market Share
                            10
                                                                        0.3
                                                                        2.1




                             8
Millions of Units Shipped




                                                                        7.3




                             5

                                      0.1
                                      0.1
                                      4.2



                             3




                             0
                                     Q3 10                            Q4 10


                                              iPad   Android   Other

                                                                       Source: Strategy Analytics
Global Tablet Market Share - 2010


                 3%
           13%



                                           iPad
                                           Android
                                           Other




                      84%




                            Source: Strategy Analytics
99.7% of people still havent bought
    a smartphone or tablet yet.

                             Source: RBC Capital Markets
The Competitors
   Not open source...yet.
              Limited hardware partners
               (Motorola, Samsung, LG)
              Delays will hurt tablet
               adoption
              To make our schedule to
               ship the tablet, we made
               some design tradeoffs.
               Andy Rubin, Google



Android 3.0 Honeycomb
   Android 3.0 (Honeycomb)
                              10.1 display
                              Verizon partnership
                              Retail distribution
                              4G upgradeable
Motorolas Xoom is           $599 / $799
iPads 鍖rst real rival.      Release date: March 27,
-Walt Mossberg, WSJ            2011



               Motorola Xoom
iPad: One Year Later
   Android 3.0
             (Honeycomb)
            10.1 and 8.9 displays
            Tab as family of devices
            Older generation in 2010
             (2m units)
            Price TBD
            Release date: Summer
             2011


Samsung Galaxy Tab
   webOS (Palm)
        9.7 display
        Positioned for enterprise
         and consumer
        Touchstone sharing
        No cellular model
        Price TBD
        Release date: June 2011


HP TouchPad
   BlackBerry Tablet OS
               (QNX)
              7 display
              Positioned for enterprise
               and consumer
              Runs Android apps in
               virtual machine
              Price $499 and up
              Release date: April 19, 2011



RIM BlackBerry PlayBook
iPad: One Year Later
Tiny!
...and everybody else.
...and dont forget these guys.
   Custom hardware
   Excellent brand recognition
   Retail distribution
   Android Appstore
   Payment infrastructure (Apple has 200m iTunes
    accounts)
   Books, music, movies
   Content distribution rights for Kindle
   Can afford low to no margins




Is Amazon the real iPad threat?
Tablet Planned Purchasing
100%

90%

80%       83%


70%

60%

50%

40%

30%

20%

10%
                                                                       8%
                         4%                              3%
 0%                                      3%
       Apple iPad   Motorola Xoom   RIM Playbook Samsung Galaxy Tab   Other

                                              Source: ChangeWave Research,
                                               3,000+ respondents, Feb 2011
 A year later, iPad has serious competitors
  pending
 Rapid adoption of Android
 Margin vs. market share challenges
 Retail distribution impact is serious
 iOS 5 - software leapfrog?
 eReaders move into the tablet space
 Apple retains aggressive component
  discounts


        2011 Tablet Market
 iPad 70-80% market share (IDC)
 iPad 68% market share, 29m units sold (JP
  Morgan)
 iPad 36.5m units sold (iSupply)



       2011 iPad Estimates
iPad: One Year Later
One year with the iPad.
     (How did I do?)
Oops.
It is a laptop replacement (for me).
 It is not a computer replacement.
Developers and designers
wont have this option as easily.
   iPad
                       Power cable
                       VGA connector cable
                       Headphones
                       Business cards
                       Pen
                       From 17 lbs. to 4 lbs.
I travel lightly.      Airport security is easier
All day with   A few hours +
 no charge     a power cable
The art of caf辿 bathrooms




                Photo by David Wright
Work




Home          Travel
 Threaded conversations
 Uni鍖ed inbox
 Still no 鍖ltering or rules
 Moved from POP folders to IMAP server
  folders
 Gmail web app for iPad is good
 Not a good power user app, prefer desktop


                  Mail
 Presenter mode improvements
 Presenter notes support
 Multitasking support
 Improved importing reliability
 Still not a great presentation authoring tool


                 Keynote
 iTunes sync
 OS updates
 Some websites (Flash and JavaScript)
 Some documents
 Printing (partially solved)
 Backup


 Additional iPad Limitations
iPhone        iPad          Mac

Always with   Always in   I have one at
   me.        my bag.     the of鍖ce and
                          one at home.
iPhone     iPad     Mac
Connect     Play    Work
 Alert      Read    Write
 Check    Consume   Create
Creating Mobile Apps Based on Behavioral
   Patterns and Specialized Platforms

            Today, Next,This Room
Venturing Beyond the App Store

 Tomorrow, 9:05am, Keynote Room - 3rd Floor
Rede鍖ning Zillow In A Mobile Era:
When A dot com is No Longer A .com

   Tomorrow, 9:50am, Keynote Room - 3rd Floor
Tablet Success

Tomorrow, 10am, Keynote Room - 3rd Floor
Cheating in Mobile

Tomorrow, 11am, Alcove 4
Touching Stories: Designing Digital
     Magazines for the iPad

        Tomorrow, 1pm, This Room
Thank you!

              www.smallsociety.com


                  Raven Zachary
             raven@smallsociety.com
                 @ravenme (Twitter)
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iPad: One Year Later

  • 1. iPad: Raven Zachary Small Society One Year Later Web 2.0 Expo 30 March 2011 Photo by Willis Lim
  • 3. Find vehicles Reserve Unlock and honk horn Extend reservation Save favorites Ideas Wireframes Design Before a line of code is written...
  • 4. A Show of Hands Photo by Nick Bilton
  • 5. Photo by Jeff Christensen
  • 6. Elisha Gray Teleautograph Photo from Oberlin College Archives
  • 8. An utter disappointment and abysmal failure. (Orange County Design Blog) Consumers seem genuinely baf鍖ed by why they might need it. (Businessweek) Nothing more than a luxury bauble that will appeal to a few gadget geeks. (Bloomberg) Insanely great it is not. (MarketWatch) My god, am I underwhelmed. (Gizmodo) Source: David Pogue, New York Times iPad Announcement Commentary
  • 9. Photo by Dan Nguyen
  • 11. Photo by Randy von Liski
  • 12. Is there room for a third category of device in the middle?
  • 14. Existing New Existing Market Market Market
  • 15. Far better at some key things
  • 17. Nobody needs a tablet. So why are we gobbling them up? - Brian X. Chen,Wired.com
  • 18. Video Web browsing Email Periodicals eBooks Games Social Networking Education News Music iPad Usage Survey, wired.com
  • 26. 2010 iPad Unit Sales Estimates 15 12 Millions of Units Shipped 9 6 3 0 ACTUAL Jon Gruber Various Forrester Jason Snell Andy Ihnatko Sources: Various
  • 27. The tablet is now a proven market. This is not a fad. ...and this market is impacting other markets.
  • 32. 14.78m sold in 2010, during 9 month period (April on) Fastest selling consumer electronic device (before the Microsoft Kinect) More than every Tablet PC ever sold $9.5bn in revenue for Apple Post-PC Era Part of the iOS larger ecosystem iPad Success in 2010
  • 33. Apple iOS Units (in millions) 200 iPhone iPod touch iPad 14.79 150 60.2 Millions of Units Shipped 160+ million iOS devices and growing 7.46 47.2 100 3.27 42.7 38.0 89.6 33.0 73.4 59.3 50 20.0 50.9 17.0 42.1 15.0 33.4 13.0 26.4 7.5 21.2 17.4 5.4 13.0 3.2 4.3 0 3.7 5.4 6.1 0.3 0 1.0 1.4 0 0 0 0 0 0 0 0 0 0 0 Q2 07 Q3 07 Q4 07 Q1 08 Q2 08 Q3 08 Q4 08 Q1 09 Q2 09 Q3 09 Q4 09 Q1 10 Q2 10 Q3 10 Q4 10 Sources: iPhone & iPad - Apple iPod touch - estimate by Raven Zachary and Apple
  • 34. Apple iOS Market by Device 9% 37% iPod touch iPhone 160+ million iPad iOS devices and growing 54% Sources: iPhone & iPad - Apple iPod touch - estimate by Raven Zachary and Apple
  • 35. Portable Gaming Market (Total Units Sold) 200 Since 2007 (2008) 150 Since 2004 Millions of Units Shipped 100 Since 2005 50 0 iOS Sony PSP Nintendo DS Sources: Apple, Nintendo, Sony
  • 36. App Store Apps by Platform 400000 350,000 300000 280,000 200000 100000 43,535 16,121 10,000 0 Apple Google Nokia RIM Microsoft Source: Various, Q1 2011 data
  • 37. App Store Tablet Apps by Platform 70000 65,000 52500 35000 17500 0 0 0 19 0 Apple Google Nokia RIM Microsoft Source: Various, Q1 2011 data
  • 38. Android Marketplace Tablet Apps Electrum Drum CNN App Speedx 3D Grocery iQ Machine/Sampler Vendetta Online Google Body USA Today WeatherBug Flixster AccuWeather Thumb Keyboard DrawFree TouchDown DueToday Opera Draft Manager 11 QuickOf鍖ce NY Times Conqu Source: Justin Williams, carpeaqua
  • 39. Thinner. Lighter. Faster. FaceTime. Smart Covers. 10- hour battery. 2x CPU, 9x graphics Video mirroring Evolutionary, not revolutionary, but... Retained price points ($499 to $829) iPad 2 Overview
  • 40. Low-res cameras No retina display Out of the box activation not available 18 con鍖gurations - color, network, storage No Flash support No 4G network support iPad 2 Complaints
  • 41. Too early to tell Only 20 days on the market in the US Only 6 days in 25 additional countries 500k units 鍖rst day estimate (source: Gene Munster, Piper Jaffray) Mall of America: line 3x 5th Ave Apple Store NYC: line 1.5x Demand > Supply iPad 2 Sales Data
  • 42. iPad 2 isnt just the best tablet on the market, it feels like the only tablet on the market. - Joshua Topolsky, Engadget
  • 43. Thats because the tablet wars have not yet begun.
  • 44. Global Tablet Market Share 10 0.3 2.1 8 Millions of Units Shipped 7.3 5 0.1 0.1 4.2 3 0 Q3 10 Q4 10 iPad Android Other Source: Strategy Analytics
  • 45. Global Tablet Market Share - 2010 3% 13% iPad Android Other 84% Source: Strategy Analytics
  • 46. 99.7% of people still havent bought a smartphone or tablet yet. Source: RBC Capital Markets
  • 48. Not open source...yet. Limited hardware partners (Motorola, Samsung, LG) Delays will hurt tablet adoption To make our schedule to ship the tablet, we made some design tradeoffs. Andy Rubin, Google Android 3.0 Honeycomb
  • 49. Android 3.0 (Honeycomb) 10.1 display Verizon partnership Retail distribution 4G upgradeable Motorolas Xoom is $599 / $799 iPads 鍖rst real rival. Release date: March 27, -Walt Mossberg, WSJ 2011 Motorola Xoom
  • 51. Android 3.0 (Honeycomb) 10.1 and 8.9 displays Tab as family of devices Older generation in 2010 (2m units) Price TBD Release date: Summer 2011 Samsung Galaxy Tab
  • 52. webOS (Palm) 9.7 display Positioned for enterprise and consumer Touchstone sharing No cellular model Price TBD Release date: June 2011 HP TouchPad
  • 53. BlackBerry Tablet OS (QNX) 7 display Positioned for enterprise and consumer Runs Android apps in virtual machine Price $499 and up Release date: April 19, 2011 RIM BlackBerry PlayBook
  • 55. Tiny!
  • 57. ...and dont forget these guys.
  • 58. Custom hardware Excellent brand recognition Retail distribution Android Appstore Payment infrastructure (Apple has 200m iTunes accounts) Books, music, movies Content distribution rights for Kindle Can afford low to no margins Is Amazon the real iPad threat?
  • 59. Tablet Planned Purchasing 100% 90% 80% 83% 70% 60% 50% 40% 30% 20% 10% 8% 4% 3% 0% 3% Apple iPad Motorola Xoom RIM Playbook Samsung Galaxy Tab Other Source: ChangeWave Research, 3,000+ respondents, Feb 2011
  • 60. A year later, iPad has serious competitors pending Rapid adoption of Android Margin vs. market share challenges Retail distribution impact is serious iOS 5 - software leapfrog? eReaders move into the tablet space Apple retains aggressive component discounts 2011 Tablet Market
  • 61. iPad 70-80% market share (IDC) iPad 68% market share, 29m units sold (JP Morgan) iPad 36.5m units sold (iSupply) 2011 iPad Estimates
  • 63. One year with the iPad. (How did I do?)
  • 64. Oops.
  • 65. It is a laptop replacement (for me). It is not a computer replacement.
  • 66. Developers and designers wont have this option as easily.
  • 67. iPad Power cable VGA connector cable Headphones Business cards Pen From 17 lbs. to 4 lbs. I travel lightly. Airport security is easier
  • 68. All day with A few hours + no charge a power cable
  • 69. The art of caf辿 bathrooms Photo by David Wright
  • 70. Work Home Travel
  • 71. Threaded conversations Uni鍖ed inbox Still no 鍖ltering or rules Moved from POP folders to IMAP server folders Gmail web app for iPad is good Not a good power user app, prefer desktop Mail
  • 72. Presenter mode improvements Presenter notes support Multitasking support Improved importing reliability Still not a great presentation authoring tool Keynote
  • 73. iTunes sync OS updates Some websites (Flash and JavaScript) Some documents Printing (partially solved) Backup Additional iPad Limitations
  • 74. iPhone iPad Mac Always with Always in I have one at me. my bag. the of鍖ce and one at home.
  • 75. iPhone iPad Mac Connect Play Work Alert Read Write Check Consume Create
  • 76. Creating Mobile Apps Based on Behavioral Patterns and Specialized Platforms Today, Next,This Room
  • 77. Venturing Beyond the App Store Tomorrow, 9:05am, Keynote Room - 3rd Floor
  • 78. Rede鍖ning Zillow In A Mobile Era: When A dot com is No Longer A .com Tomorrow, 9:50am, Keynote Room - 3rd Floor
  • 79. Tablet Success Tomorrow, 10am, Keynote Room - 3rd Floor
  • 81. Touching Stories: Designing Digital Magazines for the iPad Tomorrow, 1pm, This Room
  • 82. Thank you! www.smallsociety.com Raven Zachary raven@smallsociety.com @ravenme (Twitter)