VARs see vertical success for Tablet PC

Experts say market adoption of Microsoft-based Tablet PCs will be limited to very specific verticals and business users with special needs, but the companies behind the products aren’t worried.

IDC Canada Ltd. predicts that it will be the latter half of 2003 before the tablets, based on a Tablet

PC version of Windows XP begin to see a glimmer of market acceptance.

“”Not even taking off – just to gain traction,”” says IDC Canada analyst Eddie Chan. The units, which are manufactured by eight of Microsoft’s OEM partners, can cost upwards of $3,000. “”When you factor in a couple of hundred dollars expense for the OS (in addition to the hardware), it’s a niche market.””

That isn’t news to Microsoft and its partners, who said the primary market for tablet PCs is “”road warriors”” (sales people on the road) and “”corridor warriors”” (people who are rarely at their desk and constantly in meetings).

The tablets are available in two basic form factors: a notebook with a swivel screen than converts into a tablet and the more traditional slate design. It’s the swivel design that has the attention of Mike Hoogasian of St. Catharines, Ont.-based reseller MicroAge. He says he’s considering carrying tablet products from Acer, Toshiba and Hewlett-Packard.

“”I’d like to think we will be (in this market) in about two weeks to a month,”” he says. “”Acceptance and interest is growing for that type of product.”” He adds that a customer in the transportation industry has expressed an interest in the Acer tablet, which features the swivel display. “”They work quite well,”” says Hoogasian. “”It is leading edge, so you always anticipate some issues, but for the most part it does the job.””

Other customers could include organizations with “”significant sales forces”” and “”highly mobile requirements,”” he says. According to Microsoft, vertical markets may include health care, education and insurance.

Tablets have traditionally been limited to those markets, says Scott Ball, vice-president of Filbitron Systems Group Inc. The company is Fujitsu’s main distributor in Canada. Fujitsu is one of the most successful makers of slate-style tablets and was among the vendors releasing Tablet PC-based devices at the launch. There are more than 5,000 Fujitsu slates already in Canada, says Ball, but now that Microsoft is backing its latest product, there could further opportunities down the road. “”We expect that the (latest) tablet will have its own channel. We see a channel expansion happening in North America immediately,”” says Ball, but he cautions that Filbitron is only looking for VARs that have a good understanding of the verticals where tablets traditionally find an audience.

“”The Tablet PC is a big bet for Microsoft and our partners,”” says Microsoft Canada product manager Elliot Katz. “”It’s been in development for many years, but the time is right.””

The market may be limited at first, but the company is aiming at a wider business audience by including features that weren’t generally available on earlier generations of tablets from other vendors.

The Microsoft tablets will include USB and firewire ports, built-in LAN cards, and modems — as well as Windows Journal, the main interface for hand-written text. The accuracy of handwriting recognition capability has been pegged at anywhere from 60 to 95 per cent, depending on the legibility and neatness of the user’s handwriting.

ISVs have designed add-on applications to take advantage of the pen interface, such as SketchBook Pro from Toronto-based Alias/Wavefront. The software converts the tablet into a “”digital sketchbook”” for professional designers or business users who want to annotate presentations and documents.

Alias product manager Colin Smith subscribes to the theory that the tablets will limited market opportunity at first, “”but it’s going to be tough to tell”” about longer term opportunities.

“”When you look at Microsoft, they’re obviously not halfway involved, they’re really involved,”” he says. “”Microsoft is showing something in the neighbourhood of 25 hardware manufacturers that are looking at all types of Tablet PC applications. When that starts happening, you start opening up markets that are tough to judge. It’s hard to initially say when this is going to take off.””

Other tablets at launch come from Hewlett-Packard, Toshiba, ViewSonic and Xplore.

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