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May172009

Apple may actually make an all-in-one netbook & e-book reader

Apple may be looking to enter two new markets this year: netbooks and e-books. The company is expected to announce a new version of the iPhone at its World Wide Developers Conference, June 8-12, but it has another device up its sleeve. From the rumors I’ve seen, that device may be an all-in-one touch netbook and e-book reader. Here’s why.

Netbook rumors

According to a report from Reuters in March, Apple ordered 10-inch touchscreens from Wintek, the same company that produced the touchscreen on the iPhone. (10.2 inches is the average screen size for most netbooks.) The screens were ordered for the third quarter of this year, fueling speculation that Apple will announce a netbook in June.

There’s a strong case for a netbook. Mac sales are down this 16 percent through February, while PC sales grew 36 percent over the same period, with almost two thirds of that growth coming from netbooks. With the economy down, netbooks are more affordable. I gawked at them just last year, but I bought one just a few weeks ago and am loving it. I looked at Macs, but couldn’t find any iMac or Macbook for less than $1200, and if you want a good one, it’s a $2000 buy in. Sales of the more affordable, AT&T subsidized, iPhone more than doubled from a year ago.

Then there was Tim Cook, Apple COO, who said in an April conference call with analysts that netbooks suck and people don’t want them. “When I look at what is being sold in the netbook space today I see cramped keyboards, terrible software, junky hardware, very small screens, ” Cook said. “Quite frankly it is not a space as it exists today that we are interested in, nor do we believe that customers will be interested in.”

The key words are “as it exists today.” He went on to say that if Apple entered the market, it would have a product that isn’t terrible, like all those other netbooks, and also implied that the company has some interesting ideas for the space. Such interesting ideas as a touchscreen perhaps? Apple has a history of poo-pooing markets they plan on entering.

Enter e-books

But a 10-inch touchscreen netbook is still just a netbook. Apple needs more than one differentiating feature. Adding e-book functionality provides a huge opportunity.

The e-book market has steadily grown in the past couple years, led by Amazon’s Kindle. The device, now in its second iteration, is the first to allow wireless connection through a mobile phone network (Sprint’s), allowing users to purchase and download books from almost anywhere. No competitor in the U.S. has matched this feature.

While Amazon’s Kindle leads the pack, the Sony Reader has been around for a while, and Samsung recently announced the Papyrus, its first e-book venture. Fujitsu, Hanlin, and several other companies have recently entered the market. The feature sets for e-book readers vary, but most have around 1-2 GB of memory, connect to PCs via USB, and use E ink—a black on grey, very thin, low power consuming screen intended to mirror the look of actual print. Some devices also have keyboards, touchscreens, and color displays. The big barrier for entry is price. Most devices retail for at least $350, and some are priced in upwards of $1000. It’s difficult to justify spending so much for a device that does only one thing well. An e-book reader that doubles as a netbook, however, could command a higher price.

Further igniting rumors, Amazon announced a brand new version of the Kindle, the Kindle DX, just about two weeks ago. The device is basically a Kindle 2 with a much bigger screen. The new device has a 9.7-inch diagonal screen, twice the resolution as its predecessor, and can display PDF files without extra formatting. What’s more interesting than the device, is when it was announced. Amazon announce the DX just a month after releasing the Kindle 2. I can’t remember the last time a tech company announced a new device so soon after its predecessor. The Kindle 2 was announced more than a year after the original Kindle. The move has upset many Kindle 2 owners, who just paid $350 for a device that is already outdated.

The device doesn’t even have a firm release date. Amazon may know something we don’t. For the company to care, it must believe Apple (or another company) will try to enter the e-book market very soon. By announcing a new Kindle early it may hope to get attention, and preorders, before Apple makes its big announcement in June. Samsung employed a similar strategy when it announced the Instinct, an iPhone competitor, last year. The device sold very well until Apple released the iPhone 3G a month later.

A huge opportunity

If Apple can release a device that satisfies netbook users and e-book readers, it’s golden. It could also finally turn e-books into an appealing alternative to print, much like the iPod and iTunes turned the music industry on its head.

A 10-inch touchscreen is a start, but it’s not enough. Here’s what else it needs:

  • A keyboard: a touch keyboard works on the iPhone, but I’m not convinced typing on a full qwerty with more than thumbs would be a pleasant experience. 
  • E ink: Developed by a Massachusetts company, the screen technology mimics the look of print and consumes very low amounts of power. Unfortunately, all E ink devices I’ve seen are black and white only. A color display is needed. There are already netbooks in development that have a toggle, allowing an E ink display to be used when reading.
  • A big harddrive: Not physically big, as the device will have to be thin, but to double as a netbook it needs more than 2 GB of internal memory.
  • iTunes Game & Apps: In addition to music and movies, it would be amazing if the device had its own Apps store. Games and Apps on the iPhone are already touch ready and could be scaled up relatively easily if Apple designs the product in the right way. The Apps store is the iPhone’s greatest asset, and having a Mac that actually has a lot of games would give a big boost to those seeking a netbook as well.
  • iTunes e-Books: It’s about time Apple enter this market. It’s a crazy one, but to compete with Kindle it needs to have a strong library of e-books for sale. A color screen would open the door for comic books as well. Audio books would also be fantastic. I really wish the Kindle 2 or DX would let you read a book while listening to its audio. The problem here is that Audible.com, a leader in audio books, is owned by Amazon.
  • Wireless connection: To compete with the Kindle, this is a must, in addition to Wi-Fi support. Hopefully Apple won’t partner with AT&T for this one—it’s network is just too weak. Sprint or Verizon would be more logical choices.
  • Internet browsing: This is too obvious to list. If it’s a netbook, it has to have access to the net. A fully capable browser, something the Kindle does not have, is required.
  • Tablet applications: We were promised a lot of neat ways to draw and use handwriting when tablet PCs were “the next big thing.” They never really materialized, and neither did any of their promises. If Apple can add a couple cool features like handwriting transcription or maybe talk-to-text, I’d be onboard.
  • More fun ideas can be found in a very fun article by Spidouz.

Newspapers are crumbling and the success of netbooks and smartphones, like the iPhone, are changing the ways people access the net. There is a huge opportunity for a company like Apple to make a really good and affordable all-in-one device. Its the only company I see with the relationships, technology, infrastructure, and usability focus to pull it off. I’ve always been a PC guy, but this type of device could change things. College students may not need stacks of books anymore; businesses could run entire meetings digitally. There are a bunch of nutty things that could happen.

Apple, release a new iBook so the e-print train finally leaves the station.

Reader Comments (1)

I am dying out here with all this new media. Ahhhhhhhhhhhhhhhhhhhhhhhh.................................. How can I survive..................................................

May 27, 2009 | Unregistered CommenterWiz

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