Tablets: the Next Generation of Computing?
As you may have acknowledged, Tablets have been rapid growing in its presence. The release of Barnes and Noble new Nook added to the gigantic pool of existing tablets: Kindle Fire, Galaxy Tab… the endless list continues. Manufactures seem to realize that consumers are no longer satisfied with the size and weight of modern laptops. Netbooks, present intermediate between the smartphone and the laptop, never seemed to have taken a dominant market share. Despite have superior media capacity and computational power than a smart phone in a way analogous of Desktops to laptops, the tablet’s price/computational power ratio is equally no match for the latter pair, matching its position almost identically with that of netbooks. There is a slight tradeoff of between power and portability as well, but clearly that’s not a sufficient explanation.
When the iPad first entered the market, attempts to utilize the device were daily jokes among spectators. Now, not even two years later, most have accepted that we are marching into the age of tablets. What caused this change? While a variety of factors ultimately resulted in the phenomenon, network effects can shed significant insight. First consider direct benefits. Do tablets become more valuable as more people begin to use it? Initially, one would think that beyond fab formation, there can be little contribution, as after all, the app market for the OS has already been opened and filled by smartphone developers. However, popularity of tablets does bring more interest for developers, especially to creating specialized apps that takes advantage of the tablet’s superior performance.
So while with the model established, it is puzzling how virtually no ‘push’ was necessary for the iPad to exceed its critical point. It is certainly likely that with so many competing products, that it can prove worth it with so few users, but perhaps it is of appeal to those with neither a smartphone nor a netbook. There is, however, another factor to consider. Apple, in its past years of marketing, has successfully established a strong reputation among its customers. Perhaps the very few buyers are simply diehard Apple fans, or they believe that it will become worth it like they have experienced with their other apple products; some even require very little of the device and simply desired to be in fashion. Given that the actual curve will not be a simple quadratic function, there are many critical points, and Apple alone pushed past many of them.
Alternative, consider the model of the informational cascade. Certainly, the decision of whether a tablet’s worth is nothing close to a binary value. However, in the sense of the model, it can easily be compensated for, as some actions can produce more signals than others. The largest deviation is, however, those purchase events are not sequential. Perhaps some may not choose to purchase an iPad at first, but simply wish to observe, this person will provide no signals. Those that do purchase seem to overall create a high signal. So where does the low signal come from, since not everyone’s rushing to get a tablet right now? Perhaps some see people not doing anything with it and decide it is useless, that is such a strong low signal that it may overwhelm all the high signals from the purchases. Nonetheless, enough people are in the world to the point where that number of tablets will continue to increase for a while. Regardless of which model may be more accurate, it is for certain that network effect play a dramatic role in the popularity growth of the tablet. Like the nook, many more tablets will make their way into the market, which can only benefit the consumers.
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Netbooks
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