Adventures in Alpha Land

Episode 6: Ben Bajarin on the Future of Tablets in the Enterprise

Tech industry analyst, Ben Bajarin, presents the results of his research on the future of tablets and tablet apps.
Show Notes

00:00 Dan: Intro to episode 6.

00:23 Dan: You wrote on about tablets as clipboard replacements in the enterprise. Can you talk about that and B2E (Business to Employee)?

01:14 Ben: We started tablet research before the iPad with netbooks.

01:49 Ben: We discovered that some workers needed computers, but weren't sitting down at work.

02:12 Ben: Chevron's CIO explained how their workers need devices while in the field.

02:40 Ben: I realized this was replacing the clipboard for field workers.

03:12 Dan: Tablets are a similar form factor to clipboards.

03:30 Ben: Somebody who uses this needs to hold this all day while they walk around.

04:23 Dan: Clipboards usually have multiple, specialized forms.

05:23 Ben: Yes, companies had not used a computer in this way before.

05:50 Dan: But what they did use ended up in computers.

05:57 Ben: Workers would take notes in the field and then come back and log them.

06:19 Ben: Now you are seeing all of that captured in real time.

06:31 Dan: The number of apps that do this is still small.

07:19 Ben: We're still very early for enterprises.

08:01 Ben: Now we will see the transition from smartphones to tablets.

08:32 Ben: The first step is moving from paper to computers.

09:10 Ben: Next we need to see people reimagining that task.

09:37 Dan: A tablet is big enough to require less accuracy, so you can use it while walking and standing. You can also share with others.

10:48 Dan: We are working at Alpha Software to get the cost of development low enough to allow experimentation.

12:00 Ben: It's like a blank slate for the future.

13:17 Ben: We are seeing developers create development tools that work on the tablet. That allows a lot of innovation.

13:50 Dan: Apple needs to let us program on these devices

14:24 Ben: Enterprise guys are looking at very specific processes.

15:13 Ben: You're seeing it now in construction companies.

16:00 Ben: Now it's about collaboration.

16:18 Ben: We haven't seen collaboration with creative tools on the iPad.

17:14 Dan: The iPad is magical, because you have control.

18:26 Dan: It's got to better and faster than paper.

18:40 Dan: How big is the corporate market for tablets?

19:19 Ben: We estimate it at 500 to 600 million units.

20:20 Ben:It's waiters, construction. People who haven't used computers in work.

22:09 Ben: We did research on companies that translated their marketing materials to iPads, and they now travel with multiple iPads.

22:35 Dan: So they take multiple iPads on trips?

22:50 Ben: They hand them out to the whole team pre-loaded with presentation.

23:13 Dan: So this is many to one. Depending on the application you can use different tablets.

23:36 Ben: The use case is like a clipboard. You take one as you go out to work.

24:00 Dan: A clipboard may have multiple forms. You might take multiple tablets.

24:55 Ben: This many to one makes this a much larger market.

25:59 Dan: It's crucial that there are software development tools for the long tail experiments.

28:37 Ben: I agree. Having the tool sets is important to use these new use cases.

29:10 Dan: Apple has been very good at this.

29:31 Dan: Thank you very much. How do you spell your website?

29:58 Ben: Techpinions.


0:00 Dan: Welcome to episode 6 of Adventures in Alpha Land. I'm Dan Briklin, CTO of Alpha Software. Today, I'm talking with Ben Bajarin, principal industry analyst at Creative Strategies, about the future of tablets and tablet apps.

00:16 How are you doing, Ben?

00:18 Ben: I'm doing good, Dan. How are you?

00:19 Dan: OK. Let's see. You posted something on, was it Techpinions, which is...

00:28 Ben: Yeah.

00:29 Dan: ...The blog, that you and others there participate in. It was about the iPad Air 2. You're talking about clipboard replacements, which got me all interested, because that's tablets and the enterprise. I figured, I'd give a talk to you, about tablets and the enterprise. B to E, not B to C. All some people want to talk about is, B to C.

01:01 They can't imagine anything without a customer involved. That's been covered enough. Can you talk a little bit about that area?

01:14 Ben: Yeah, you know, I think what this sort of jumped out to me. When we started our tablet research, this actually happened a little bit before the iPad was released. You know, obviously, tracking Apple like we did, we had heard some rumblings that there was some tablet work going on.

1:32 Ben: We started really digging into the market. What was interesting was that we had some learnings, both consumer and enterprise, from netbook research that we did that sort of shed a little bit more light on where we thought the tablet opportunity was.

01:48 Some of that learning translated, again, back to the fact that people in the enterprise, your enterprise workers, needed a pretty robust PC, but again they didn't sit down at a desk all day to do their job.

2:00 That's really where so much interesting work we're seeing go into tablet deployments is around those most mobile sales force, field force workers, people who, again, don't sit down all day.

02:12 I was first, sort of, this really hit home when I was talking with Chevron's CIO and they deploy over 30,000 iOS devices. Somewhere around 10-15% of those now iPads.

02:25 He was explaining how people would go out onto the rig to do their security checklists. They would take pictures of things that needed to be fixed. They would do data entry in real time.

02:35 That was when I started thinking, you know what this is really doing is it's actually replacing the clipboard, because that's what people were going out into the field.

02:44 That's what people were using in construction sites to hold up their blueprints and look over specs in real time. All of that now, sort of, being shifted over where an analog process of paper and a pen and a clipboard is now being moved over into the digital world.

03:00 The tablet, or the PC in the shape of the tablet, is the mechanism now that's driving bringing a computer to people who never used them before in their daily job. Just, again, because they were always on their feet.

03:12 Dan: And clipboards were acceptable as a form factor. The tablets are similar form factor, while the laptops clearly weren't.

03:25 Ben: I think that was definitely in the observation around the form. That was one of my big, sort of, beefs, and I had this debate with Microsoft and some of the other PC vendors. I said, guys it's still too big. They're like, what do you mean it's too big? It's smaller than your PC. I was like, that's not the point.

03:43 Somebody who's going to use this, they want to walk, and you need to be able to hold it all day long. That's one of the more fascinating things. With the article that I did, I took a picture of my iPad on the clipboard. The point was they're very similar in size and this is why it's also important to make them thinner and lighter.

04:02 To the point that, to deploy these things to people who again walk around all day, it needs to not be too burdensome to carry and hold around. It needs to be a form or function in that sort of shape that again is easy to hold, easy to use in that environment. That's, again, the clipboard was always that, to your point. That's kind of the tablet form factor in it's purest form for these workers.

04:24 Dan: One of the things about the clipboard is, as I recall, is that frequently you have forms on it of some sort and the forms are very vertical. I mean, they're very custom.

04:36 They're designed for the particular task in many cases. I mean there's the, there's the standard receipt type one, but for people who are out inspecting and things like that, its probably specific to the task.

04:55 But it's really inexpensive because all you do is print out the forms. You sit down in Word or Excel or something like that or some desktop publishing thing. Illustrator if you're sending off to the right place. Then, just throw it in the copier machine. It was very specific to the application. It's very long tail. Is that it?

05:23 Ben: Well, yes, I mean, I think again, if you recall, kind of, the way I articulate this. This is what is actually fascinating, because a lot of companies, call it your construction workers, your hospitals, your truck roles, PG&E. I mean these types of companies had not used a computer in this sort of form before. Right?

05:49 What's fascinating...

05:51 Dan: The things that they did use, may end up in computers, right?

05:56 Ben: Exactly. It always came back to, you'd take notes in the field, perhaps you'd take a picture, and you'd go back, and you'd sit down, and log those mobile field force, sales force, whoever those mobile workers who don't sit at a PC, can capture the data that they need now in real time, and bring that back into the enterprise systems.

06:15 Now, all of a sudden, you're actually seeing, all of that security checks. You're seeing, real-time routines. You're seeing, real-time sales, all of that stuff, now captured in real time. Again, it's the evolution of that vision. Now being fully realized, because we've got the fundamentals of these devices, to take advantage of it.

06:32 Dan: That's the vision people have, of what they want. Some people are actually implementing it. But what we're seeing is that, a lot of the places aren't actually deploying as much, as the number of actual apps that are being deployed by most companies, for internal use, where they write them themselves, is pretty small. You can count them on one hand, according to a lot of the research.

06:57 There's this disconnect between the desire to use it. One thing I saw is that they, the initial people with tablets in companies were often the senior executives, who saw it at other meetings, where they ran into other senior executives who had one, and said, "That's cool. That's a great laptop replacement for my meetings."

07:19 Ben: Well, yeah. We're still very early. Even, if I just look at some of the very crude estimates I've tried to break down, in terms of corporate sales of tablets versus consumer. It's just been overwhelmingly in favor of consumers. We're still barely seeing enterprises now begin to deploy these types of solutions.

07:42 What is interesting is that, the tablet benefits from the advancements and the acceleration that's happened within smart phones, being deployed to these workers. There has been a fair amount of software, now that's being able to take advantage of many of these back-end systems, from mobile phones.

08:01 What's now going to transition is to say, "OK. Where you're inhibited by your smaller screen, what can I give you now in this bigger screen, as a part of your job, whether that's marketing material, or financial data, or sales material, or whatever, when you're presenting to a client, or doing marketing." Imagine a real estate agent, showing property, and how they use them. These are all very interesting use cases.

08:22 A lot of that software had started with the smart phone. The tablet will benefit from some of that, as the tool sets adapt. Again, what we're talking about is, how do you adapt paper over to the tablet, which is step one.

08:37 The step beyond that is, how do you even give your worker, an even better tool set, including both the hardware and the software, to do their job even better?

08:47 That's the empowerment, now, of this new mobile workforce, through things like mobile, cell phones, smart phones, and tablets. We haven't got there yet. Even if you just look at some of the marketing around that, IBM has done around these business deals.

09:02 They use this "The future of work is mobile." If the future of work is mobile, here's our ideas about how that plays out.

09:09 Similarly, more of that kind of thinking needs to take place so that those who are deploying aren't again just duplicating paper processes, but they're re-imagining how that process, or what that task, what that tool, could be like, now in the digital age.

09:25 That, you're right. We're at the early, early cusp of this. It's going to drive quite a bit of innovation around tablets, and work over the next four to five years.

09:36 Dan: That's an interesting thing about the tablet. A tablet, it's big enough that you can have large areas for touch. Your accuracy can be much less, which lends itself, when you're standing or walking. You don't have the same accuracy you do when you're sitting down.

09:55 On a phone, you don't have much space to do those things. The other thing with the tablet is that, the other person, as you say, can see it.

10:04 It's much better for sharing information. Specifically on that one, they wanted to make sure that people could see what was going on, that it was just randomly going left and right.

10:16 They were just tapping and not typing in what you look like, or something. The same thing when you're talking about sharing sales material or something.

10:26 The cell phone is, an individual looks at it. They rarely can share it with, definitely not more than one other person. A laptop is between you and the... but the tablet, you can share with somebody else.

10:45 Apple's working hard to make it easier to program. We're doing that at Alpha Software, to make it as easy as possible for people to program these systems, but the experimentation is going to be really good, if we can get the cost of developing the apps low enough. I think, something came out today about that.

11:07 The price of developing applications is a real problem, because you need to do the experimentation. The application you're talking about of the CRM type one, taking an order, and knowing about the customer, or the sales support.

11:23 Those sound like they're massive applications in many ways, hooking up to the corporate jewels database, which will scare IT about security.

11:36 You don't worry as much, about the security of a clipboard that's just, you're filling out forms, because the only data is the data you got when you're inspecting something, or whatever. It's not as critical.

11:49 Those type of applications may lend themselves to be deployed first, because you don't have to solve the security issue as much.

12:00 Ben: It opens up all these doors, as a blank slate, for the future of computing. Where now, all of a sudden, as long as software is written to take advantage of all these different news cases. What makes that "slate" interesting is that it could be anything.

12:14 It could be an art studio, for an artist. It could be a photography studio, for a photographer. It could be a presentation tool, for a presenter.

12:23 It could be something that a person uses to give tours of museums, and have access to data and show things. It can be so many different things. That's what's both its opportunity and challenge. It can be so many things.

12:36 It's hard to figure out right well, how would I use this, because I see, how other people are doing it. You're already seeing these kind of unique deployments, where they're saying, "At the base level, you can take this out, walk around, and use it as computer, so I'll do these things."

12:50 The line that Steve Jobs used that was just a great way to frame the iPad was that, it's more personal than a computer, and more powerful than a smart phone.

13:02 Those were really important perspectives around how you understand how it fits, more importantly, the broader opportunity for it. We do need to see those things. One thing I've thought about, too that's interesting enough.

13:15 There's a couple of apps that I'm forgetting to name those, that you're actually seeing app developers now create tool kits that allow you to create tablet apps from the tablet.

13:24 I don't even need to be PC literate, and use the desktop tools. I can actually use mobile tools. As that happens, we might see places like India, places like China, where tablets are actually a pretty healthy use of the mix of the online population in those countries, and do them for more than just watching TV, start to maybe run their business off it, maybe create their apps.

13:45 That, I think, will set the stage for a lot of the software innovation that I'm talking about.

13:50 Dan: Yeah, if Apple will let us make things that let us program, so to speak, on these, to make apps we can distribute to others, which hopefully will happen. It's important that we do that.

14:05 It sounds like, within businesses, some of these are for a particular application of some sort. For some of the esoteric business uses, it would be up to the business itself to do the experimentation.

14:21 Ben: It's hard for those types of enterprise guys to just keep their eye on the whole field. They're looking at this right now, at least as I talked to them, with very specific interest in mind, "I want to take a process that was analog. I want to make it digital. I want to give a new tool to one of my mobile workers."

14:46 Maybe some of this is hopefully feedback from the field, "Here's how to make it better. Here's how I could do my job better," and these types of things.

14:55 I think, again, best practices play into this from companies that sort of take a lead in this environment to come out and say here's what best practice examples are.

15:07 I think as we see those types of things, those processes evolve. You're seeing it right now in a lot of construction companies. It just started with, let me go back to corporate, get all the blueprints I need for a job, download them all to the iPad, and then go out and do it.

15:27 Right, and now you're seeing them come back and say, now while I'm on the job site, we've connected blueprints to the cloud, so that if somebody back in the corporate workstation looks and says, " We need to make a change," they can make that change in real time into the blueprints and then send it out to all of the job points.

15:47 So it's now that new relation of cloud versus native. But you're doing collaboration, you're doing communication, you're having all of those tools which was once just make my paper processes digital. Now it's, let's collaborate, let's mark up in real time, let's make changes across the group.

16:04 Now you're seeing, again, that collaborate in ways in which we always used PCs as an enterprise collaborative environment, you're now seeing that come into the enterprise.

16:14 The thing that we haven't seen, to be honest with you, I think is interesting, is we really haven't seen collaborative creative tools now on the iPad, things where can artists collaborate in real time and either do a painting together or a drawing together or even just look at logo design and mark that up and use the tablet to make the changes.

16:32 Because a lot of really good apps are coming to do creative digital design and to do a lot more artistic-based things, again, whether it's music or others, and we just haven't seen those types of collaborative efforts come as well.

16:46 I think, again, we're on the cusp of that. You're seeing the creative community draw on these things. You're seeing them take and do music on these things, but there's not that collaborative effort that's coming out. That's some of those few new steps that I think are coming.

17:02 That's again, taking the computer, which is in this form factor, and starting with just let me do this because I'm mobile and then moving to it would be so much better if I could these things, and then start to integrate those features.

17:15 Dan: The thing that I wrote about, that the iPad is magical, this is the thing that Jobs kept saying, magical in the sense of magic means I have control. A magician has control of things you wouldn't expect, effortless control.

17:31 That's what the iPad, compared to anything else, the phone, or the laptop, or anything, was this feeling of direct control right out of "The Wizard of Oz," right out of a magician.

17:50 Having that, when you're working with music or you're working with art, you want that control and the ability to do that all the way up to where you're doing maybe inspection of something and, as it's inspecting, it's being smart and saying, "Oh my god, if you have this and that, you better check this and let me give you the information on the spot here. I'll connect you live to a specialist."

18:25 It's having the right way to be able to check off things faster than you could check them off on paper.

18:32 It's got to be faster than paper. That's one of the things, right? It's got to be better than the ways we did it before.

18:40 So how big is this market in the corporate side? How many? Corporations, I think if they buy a tablet for a particular application, it's like nothing, especially if it's not using cellular, if it's only using WiFi. They cost nothing compared to the cost of the case and the training and whatever.

19:07 They can lock them down because it's not yours. It belongs to the company. You don't mind if it's locked down. If they take your phone and lock it down, you care. How big's this market?

19:19 Ben: I think the commercial side of this gets really interesting. Even if you look at comparables around the PC space, you've got point of service terminals, you've got back-end systems where these devices sit and are mounted somewhere. All of those, I think it can replace PCs in those areas.

19:42 Then you've got the greenfield, these people who didn't use a PC in their day job but yet are a worker. How are they going to take advantage of that? We've done some estimates in looking and trying to put some hard numbers to that.

19:57 We think that the opportunity just in developed markets, not even in way outskirts of the bush of China and Africa, in developed markets, the people who do work and could use a computer in their day job, is upwards of 500-ish, 600 million on the conservative side.

20:18 Dan: Worldwide?

20:19 Ben: Worldwide, yeah. It's waiters, it's field force workers, it's construction, it's PG&E rigs, Comcast rigs, cell rigs, people who had not used a bigger screen.

20:30 Maybe they use their smart phone for some stuff, but they hadn't used a bigger, more capable computer in their everyday work.

20:36 Again, I think that's on the conservative side. When you look at what's happening in China, what's happening in even parts of India, Russia, economies where, again, PC install base is not high, yet smart phone install base is high.

20:50 The smart phone sets the entry-level precedent for moving up somewhere. At some point, I think they get something, at least some percentage.

20:59 I don't think everybody on the planet uses their mobile phone as the only computer they use. As they graduate, if you will, I don't think they go to the PC, just because of computer literacy things we've talked about.

21:10 The tablet makes for an interesting next step for them from the smart phone when they say, "Look, I'd like to start doing more."

21:18 The software infrastructure supports that, whatever it might be -- education, entertainment, which is what we see right now, or other forms of productivity. I think the market's quite large.

21:29 Obviously, what we don't know is refresh rates and people like our clients who want to know how many will I sell each year. Those are the dynamics that are much trickier to pin down.

21:38 The upside, the greenfield opportunity for people who did not use a computer in their day job, just because they were so mobile and using a bigger screen with the tool of the tablet, I think the upside of that is really quite large. We're just starting to recognize that.

21:55 That, I think, is the area that is the fundamental for the tablet as a growth category over the next few years. Much less so consumer in the short-term, better in terms of these enterprise environments.

22:09 We did some research on some financial services companies that translated almost all of their financial marketing material, their brochures, their training. They used to carry briefcases of these, huge briefcases through airport security, of paper.

22:26 They've transitioned all of those to iPads, so now they travel with eight or nine iPads. That's basically it, in their case.

22:32 Dan: Eight or nine iPads?

22:34 Ben: Yeah.

22:35 Dan: Basically, you'll take multiple iPads? In other words, I may have one device that I use when I inspect something and another device I use when I sit down with you to tell you why we should upgrade?

22:48 Ben: In the case of this company, they were actually handing them out to the whole team that they were presenting the data through. They came pre-loaded with all of the PDFs. As they would present, they would cycle through.

23:00 They would used to hand out marketing material. Instead of handing out marketing material, they're handing out iPads.

23:06 Dan: They give you an iPad, right.

23:07 Ben: They're just getting them back, and then moving on to the next meeting.

23:09 Dan: The fact that they had multiple of them is not an issue? Instead of one-to-many, this is many-to-one?

23:16 Ben: Right.

23:17 Dan: Which is an incredible opportunity then, for different manufacturers. Depending on the application, you may not need to have the best ecosystem of apps.

23:32 Ben: Yeah, I think you're right. That part's relatively irrelevant. What matters is that the said app that matters or said material that matters gets on the device.

23:42 Again, people aren't taking these home and saying, "I'm going to let my kids use them." Sometimes they do.

23:47 The use cases where I think this is interesting is, like I said, where, like your clipboard, you check it in at the desk, you take one out when you go into the field, and you start doing your work. You'll take one of these off the charger, and out you go into the field to do your work.

24:00 Dan: The clipboard may actually have multiple forms in it, so in this case you may take out a few. It may be like that metal box they would carry that has all the forms in it that's like a clipboard. Sits behind the clipboard. Where they take the check from you.

24:15 Now what they'll do is they might have a little box, a holder, that holds one, or maybe multiple. Even Apple uses holsters around their iPhones that they use at the store.

24:32 They don't use them naked. They've enhanced them with card readers and scanners and stuff like that.

24:42 That's also a growth industry, I take it, is the accessory that goes around the device?

24:48 Ben: Yeah. Again, the point in all of this that I think is the fundamental one is it's what makes this market that much larger in that even in enterprise environments it's still a one-to-one product or even a two-to-one. I need many of these as I go out to do my job because they each have a very specific job to be done.

25:10 The software can be general-purpose in as far as it's either loaded or said device is used in said way. You may or may not use the same iPad, if you will, to dock and sit and do what you're doing in the field versus the one that you might actually take onto the oil rig, for example.

25:30 That's why enterprises are now learning about...I think that's, to some degree, why the IBM deal was a very big deal for Apple.

25:38 It basically helps them achieve scale with support, with software, with all those infrastructure points they need to manage and handle very large deployments of tablets.

25:48 Which they couldn't do before in a consumer environment, and now they can with IBM in ways that that was a huge hole in their strategy.

25:57 Dan: I think it's crucial that there be software development tools. This is the world I've been in my whole life, since I first started working on word processing and stuff like that and the spreadsheet.

26:12 Ben: The tools for individuals to be able to create what they need to create to get their work done and to be able to innovate. How can we give them the systems to be able to innovate here?

26:27 That's the research that's coming out. If it's too expensive to experiment, then we're not going to get something on the long tail that turns out to be at the beginning of the curve.

26:44 Apple, luckily, they're able to inspire people to try, with the vision of riches, in some cases, and that will then inspire others. The reason that I've gotten into the business side is I realized we have to do that type of innovation, also, to help businesses be able to take advantage of these technologies, too, just the way that it's really revolutionized interpersonal relationships.

27:21 The thought that you can show up at a place, say, "When we get there we'll decide where we're going to meet," that did not exist years ago. You had to plan everything in advance because you couldn't contact people.

27:36 The fact that your span of control becomes hundreds of your friends at once in terms of communication is mind-bending compared to what it was.

27:50 Being able to have those advances happen, to leverage businesses, to re-engineer the business.

28:00 This is just like the old days when they had to re-engineer knowing they had PCs on a desk. The person taking orders on the phone with a customer now could actually tell the customer, "Last time you bought such-and-such," and can have a real-time conversation about the data. That's amazing, what happened.

28:23 That re-engineering can now happen again to people who are walking. Hopefully, we'll have the systems to let them experiment.

28:35 Ben: I agree. To your point, having the tool sets available is important. At the same time, I think it's good that Apple does this, to continue to increase the capabilities of the device.

28:49 As they add new sensors, add better imaging technology, add a better screen, add security, that's when now the developer goes, "I've got better imaging. I've got a better CPU. I've got these sensors to work with. Now what can I do?"

29:02 It's Apple's responsibility, again, to include those bits on the hardware that do increase new use cases, and then, again, give the developers the tool to go and make it.

29:11 Dan: Apple has been very good at that, at doing things when they first come out. People say, "Why would you ever want that?" In hindsight, it turns out they were right, in many cases.

29:22 Others, of course, have been doing that, too. Apple's often, as you point out, not the first, but they may be the first to be over a bar.

29:31 Thank you very much. I really appreciate so much time on this.

29:35 Ben: Yeah, my pleasure. I'm glad we did it.

29:36 Dan: I'm sure my listeners at will like it. If you post it elsewhere, that'd be fine with me.

29:48 Ben: Great. Yeah, I'll post it for our readers, as well.

29:53 Dan: For my listeners, they should go to...How do you spell your website?

29:59 Ben: Techpinions.