Tablet PCs struggle for acceptance

Much-hyped but largely unloved

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The much-hyped tablet PC has enjoyed only limited success so far due to high prices and IT managers who are not willing to take a risk on the devices. That's according to a new report from In-Stat/MDR, which said that tablet PCs have only found homes in certain vertical markets such as healthcare, real estate and insurance. In other sectors, the devices have not sold well, the report indicated.

Launched in late 2002 with a special version of Windows and by numerous manufacturers, tablet PCs are a new type of laptop computer that consists of a touchscreen resting flat on top of the computer's main hardware components. Data is primarily entered through the touchscreen, although a keyboard, mouse and other accessories can easily be added.

Though the devices were launched to counteract sluggish commercial PC sales, most sectors have been hesitant to adopt the new PC form factor. "With limited IT budgets in the early part of this decade, and forecasts for annual increases in the 3 percent range over the next four to five years, enterprise IT managers have been hesitant to take a chance on a new PC form factor," said Brian O'Rourke, a senior analyst with In-Stat/MDR.

That assessment excludes a handful of vertical markets, as mentioned earlier, where workers were already accustomed to pen-based computing, and saw the tablet PC as a pen-based computing option with access to all the software that runs on Microsoft's XP operating system, O'Rourke noted. "As a result, the vast majority of tablet PCs that shipped in 2003 went to vertical applications."

Over the next few years, the devices will be taken up more broadly as prices decline to below $2,000 and IT budgets grow.

The report also noted that the 2003 launch of Microsoft Office with digital ink support helped to spur tablet PC sales, adding that the upcoming launch of the Windows XP Tablet PC 2005 Edition will help boost sales further. On the hardware side, 14-inch screen tablets from Gateway and Acer have sold well in relative terms, while Acer's "clamshell" notebook with the Windows XP Tablet PC operating system has helped drive demand.

Still, rival research firm IDC reckons that only about 1 million tablets will ship globally this year, which is up from 500,000 in 2003, but amounts to less than 0.5 per cent of the overall PC market.


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