Why the Older iPad is the New Gateway Drug to a Post-PC Future

Microsoft is gambling heavily on the tablet market, yet Apple is creating a price point advantage.
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Apple and Microsoft are once again locked in a battle, but this time around it isn't for dominance in the desktop or notebook markets, but instead for supremacy in a new market that potentially threatens the entire PC industry – the post PC market.

And right now, Apple looks like it is set to control this ecosystem and dictate all the rules, while Microsoft is left floundering without a clear strategy.

The key to Apple's possible future domination of this new ecosystem – the iPad.

Apple's iPad announcement on March 7 was all about what the company calls the “post-PC” era, a time when personal (and more personalized) mobile devices such as smartphones and tablets replace traditional hardware (PCs) to become the future of computing. And what's more, Apple thinks that it is in a strong commanding position to take control of this market.

“Apple has its feet in post-PC future,” crowed Apple chief executive Tim Cook at a press conference in San Francisco. “We think the iPad is the poster child of the post-PC world.”

Let's take a look at how Apple has taken hold of the post-PC market so far. To date, Apple has sold 172 million post-PC devices (iPhones, iPads and iPod touches), shipping a colossal 62 million of them in the last quarter alone. Sales of these post-PC units accounted for 76 percent of the company's Q4 2011 revenue, a figure that is only going to increase in 2012.

How big a player is Apple when it comes to post-PC devices?

Big. Very big. In fact, it's so big that if the iPad were a PC, Apple would now be selling more unit than any other PC maker in the world.

In the last quarter alone Apple sold 15.4 million iPads. Its nearest PC OEM rival, HP, sold 15.1 million PCs. The next nearest rival, Lenovo, sold 13 million, while Dell only managed to shift 11.9 million PCs. And remember, Apple has accomplished this with a product that was first bought to market less than two years ago, and with a product that many pundits expected not only to fail, but to fail spectacularly.

It's also worth bearing in mind that Microsoft has been trying to break into the tablet market for over a decade, with little in the way of success to show for its efforts.

It could be argued that the post-PC future that Cook was talking about is already here.

A New Player Emerging

Currently there are two players in the post-PC ecosystem. There's Apple with its iOS devices, and there's Android, along with the myriad of OEMs making smartphone and tablets powered by this platform.

While Android has the lead when it comes to volume of units shipped, these sales are split across a crowd of OEMs all fighting against each other for consumer's wallets. This infighting among the players and the lack of differentiation between the different Android smartphones and tablets means that they're in a race to the bottom in terms of price. Consequently, profit margins are razor thin.

But pretty soon there's going to be a new player: Microsoft.

The Redmond giant is hoping to grab a piece of the post-PC era action by shoehorning Windows 8 onto ARM-based tablets. Microsoft is taking a massive gamble on this, choosing to change its entire Windows operating system in the hope of making it more touch-friendly.

It's a massive gamble because Microsoft is pushing their new touch-optimized user interface not only onto tablet users and onto those with touch hardware, but onto everyone, including those sitting in front of a desktop system with a keyboard and mouse attached.

Microsoft is serious about entering the post-PC era, but Apple isn't sitting still. So far, Apple has relied on the iPhone and the cheaper iPod touch to give it leverage into the post-PC ecosystem (yes, it comes as a surprise to some, but the iPod touch is a post-PC device).

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Tags: Microsoft, iPad, Apple, tablet

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