Keeping tabs on enterprise

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Making tablets appeal to the B2B sector has been problematic, to say the least, with firms unable to justify the extra cost or figure out where they could add value. We asked an industry panel if that was changing

When Apple unveiled its then revolutionary iPad tablet device in January last year, optimism among the independent mobile dealer channel and in mobile distribution was high.

In the wake of the launch, many dealers and distributors Mobile News spoke with saw the new market as a great opportunity to penetrate the IT sector, as tablets were widely expected to eat away at the laptop and PC market.

But while tablet sales have been strong, predicted to reach between 55 and 70 million by the end of the year – up from about 18 million in 2010 – many suggest the impact on the B2B channel has been minimal at best.

Distributors Mobile News has previously spoken with, such as 20:20 Mobile and Data Select, have said that although actively involved in the distribution of tablets, they have remained cautious.
It is understandable given the number of tablet horror stories that have surfaced in the past year or so.

Poor sales
Sources close to distribution claim major network operator Orange and supermarket chain Tesco have already been stung by tablets, having attempted to predict the strength of the market.

There are rumours Orange placed orders of about 2,000 original Galaxy

Tab devices to sell through its retail channels, but sold just 50 in the opening fortnight.

The same device also struggled through distribution, due to a price war between HMV, Tesco and Carphone Warehouse, which all sold the device for less than the trade price – meaning dealers would make a loss if attempting to price match.

Operators do not appear to be pushing the market either at present.

While data plans and devices are increasingly available through stores, operators do not currently offer a deal or package that allows a device to be subsidised (as with handsets), meaning those wishing to buy one will have to pay the amount in full.

Cost issue
The majority of those we spoke with claim that cost remains a major stumbling block in its development.

Devices cost around the same, if not more than a high-end smartphone, typically between £400 and £500. With employers already paying for handsets and airtime/data plans, this requires considerable investment.

One especially interesting trend was identified by our panel – the reluctance of firms to fork out for 3G tablets.

Most devices now come equipped with Wi-Fi, which provides the customer a cheaper if not entirely free alternative to using network data. Operators have hinted that a data and Wi-Fi offering to reduce the costs of tablets will become available, but as yet nothing has launched.

A large number of dealers we spoke with also claim the majority of the tablets they do sell are to the directors of a business who admit the device is for personal usage or for a family member.

What are they for?
Costs aside, the question of what a tablet is actually for still remains clouded.

A number of dealers argue current tablets are little more than large mobile phones, or an alternative way to view video content, surf the web and access social media – services available on most smartphones and predominantly focussed at the consumer end of the market.

As such, the need or appeal for a business to invest in an additional device for a member of staff, is simply not there.

Some dealers claim the only interest for tablets comes from the senior execs of businesses who are buying them for personal usage.

B2B failure
BlackBerry manufacturer RIM was expected to make significant strides in the B2B space, having spent much of its history focussed entirely on enterprise.

But despite launching its PlayBook device earlier this year, after a number of initial delays, dealers in the B2B space claim it has failed to make a major impact on the market with minimal sales and demand.

Enterprise-focused HP, which held a number of events expressing its desire to fill the void in B2B for tablet devices, stunned the industry when just days after launching its webOS-powered TouchPad, pulled out of all consumer electronic projects altogether.

Other manufacturers such as Motorola, Samsung and LG have all launched their own tablet devices, but each has been marketed entirely at the consumer end of the market – offering entertainment services and 3D technologies, none of which have a direct B2B appeal.

Demand
However, the belief from the B2B channel that tablets can become a major market within their sector, remains positive.

Those we spoke with highlighted businesses in logistics, sales and hospitality as potential target markets. Others claim to have been approached by businesses working in design, such as kitchens
or architecture, to use tablets for demonstration purposes. Some B2B dealers are even buying them for their own staff to use when discussing tariffs, devices and other services available to the customer.

Our panel of B2B dealers and analysts gave their views on the tablet market.

Full article in Mobile News issue 499 (October 10, 2011).

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