rise of the tablet pc and the need for extremely modular tablets
DESCRIPTION
Overview of the growth of the Tablet Market, ruggedized and commercial tablets and exploring the need for extremely modular and upgradable tablets. Takeaways: Reduced Technology Obsolescence, Lower Cost, Faster To Market, Customized to End Users Needs, Maximizes Application Software Features. Table of Contents: Introduction 3 Death of the PC 4 Rise of the Tablet Market 5 Consumer Market 9 Ruggedized Market 10 Rugged & Commercial 11 Time to Market 14 Modular: The Tablet Evolved 17 Example Modules & Options 19 Prospective Markets 20 Airline Use Case: Odem™ Core 21 Flight Crew 22 Flight Attendants 23 In-Flight Entertainment 24 Ticket Counter Check-In 25 Gate Agents 26 Private Club 27 Maintenance 28 Ground Support 29 Summary & Conclusions 30 References 32 About the Authors 33 About Pepperwood Partners 35TRANSCRIPT
Pepperwood Partners© All Rights Reserved February 2013 Page 1
Rise of the Tablet PC and the need for
Extremely Modular Tablets
by Stephen Carpenter
and Patrick Seaman
March 2013
STRATEGIC WHITE PAPERSTRATEGIC
WHITE PAPER
TAKEAWAYS
• Reduced Technology Obsolescence
• Lower Cost
• Faster To Market
• Customized to End Users Needs
• Maximizes Application Software Features
Executive Overview
Pepperwood Partners© All Rights Reserved March 2013 Page 2
Topics in this White Paper
Introduction
3
Death of the PC
4
Rise of the Tablet Market
5
Consumer Market
9
Ruggedized Market
10
Rugged & Commercial
11
Time to Market
14
Modular: The Tablet Evolved
17
Example Modules & Options
19
Prospective Markets
20
Airline Use Case: Odem™ Core
21
Flight Crew
22
Flight Attendants
23
In-Flight Entertainment
24
Ticket Counter Check-In
25
Gate Agents
26
Private Club
27
Maintenance
28
Ground Support
29
Summary & Conclusions
30
References
32
About the Authors
33
About Pepperwood Partners
35
Pepperwood Partners© All Rights Reserved March 2013 Page 3
This white paper discusses the fast growing Tablet PC market and presents the case for a relatively unexplored new market segment – that for an extremely modular Tablet PC design that can be quickly augmented / upgraded / updated with specialized features such as sensors, special electronics, additional processors, GPUs, memory, communications devices, etc.
Included are both general industry background and analysis, as well as speculative and forward looking statements regarding market prospects for the odem™ Extremely Modular Tablet PC from Entegra Technologies.
Introduction
odem Core
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Death of the PC
The much heralded “Death of the PC” has been proclaimed by many analysts. IDC and Gartner report that PC shipments fell in Q3 2012 more than 8% from a year earlier,1 and 4.9% in Q4.2 On the other hand, the industry moved 350 million units in 2012.3
Many blame tablets, mobile and other factors. Other factors include the success of the PC platform itself – that even 5-7 year-old PC’s are often “good enough” for casual consumers who mostly browse the internet, do social media like Facebook or Pinterest and watch default-resolution YouTube videos.
Gordon Moore, Intel co-founder postulated that the number of transistors on integrated circuits doubles about every two years. This is often generalized as “computing power” doubles roughly every 18-24 months.Old processors are still OK for everyday use
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Rise of the Tablet Market
While growth rate of traditional PC sales have flatlined, Tablet sales are rising fast.
The rapid growth of the consumer-grade tablet market is led by Apple, with a bevy of competitors running versions of Microsoft Windows, Google Chrome, Linux, Android and other Operating systems.
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Rise of the Tablet Market
Comparing tablet sales to Notebooks, Business Insider projects4 a 64% growth for tablets -vs- a 5% decline for notebooks.
NOTE: Growth in tablets has also impacted sales of printers and print media. Morgan Stanley reports that 42% of tablet owners plan to cancel subscriptions to print newspapers.5 Figure 1: Global Tablet, Notebook & PC sales Forecast (IDC, Morgan Stanley) 6
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Rise of the Tablet Market
Figure 2: Market share: Notebooks -vs- Tablets (NPD Displaysearch) 7
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Rise of the Tablet Market
Figure 3: Tablet Sales Forecast: 2010-2015 (Forrester Research) 8
Forrester Research projects nearly 40 million tablet sales in the US in 2013, growing to 44 million by 2015.
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Consumer Market
Price range: $400 - $900+
New models every 6 - 9 months
Designed for consumers with some crossover into commercial & military applications
Security risk using consumer grade communications protocols
Fragile – requires protective armored cases
Manufactured with specific features --unable to repurpose to support business or technology changes
Mostly non-upgradable
iOS, Android, Windows, Linux
Weight 1.4 – 1.6 lbs
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Ruggedized Market
Price range: $2000 - $4000+
New models every 12-18 months after release of underlying technology
Ruggedized – MIL STD 810G; IP65 & IP67
High development costs to configure to specific features
Expensive to modify
Android & Windows Operating Systems
Mostly non-upgradable core
Weight 3.0 – 8.0 lbs
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Rugged & Commercial
The “Rugged” or “Ruggedized” market segment grew by 30.1% over the year-ago-quarter, experiencing double-digit growth across all regions.9
Meanwhile, in 2012 there was significant consolidation in the more general category of “rugged mobile” with Motorola Solution’s acquisition of PSION10 and Honeywell’s acquisition of Intermec.11
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Rugged & Commercial
The ruggedized market is under pressure from the dramatic growth in consumer tablets and their increasing commoditization.
The availability of cheap consumer tablets encourages experimentation on the part of commercial / industrial users.
While on the one hand this may diminish demand for traditional rugged products, it also has the effect of validating the market for portable hand held computing devices.
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Rugged & Commercial
The fragility of consumer devices in a commercial, industrial or military environments ultimately results in greater demand for more rugged devices.
Xplore TechnologiesdDRS TechnologiesGetac Multitouch
The growing sophistication of users pushes demand for more technologically up to date, flexible and customizable designs.
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Time to Market
To build a Commercial-Grade and/or Ruggedized tablet, you generally Start with “today’s” technology or technology standards, and engineer it to become the desired product.
Off the shelf is too fragile, doesn’t meet
needs.
Go to the drawing
board, design new product
Engineer the design
Prototype Testing Manufacturing
Sounds great, but….
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Time to Market
…but, this process takes 12-18 months. In today’s technology cycle, that means the product that started-out being based on current technology is a generation or two obsolete by the time the “New” ruggedized or commercial version is available.
6-9 Months:Engineering
Validation & Test
6-9 Months:Design Verification
& Test
ThePRODUCT IS
12-18 MONTHS
OBSOLETE
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Time to Market
The need for sturdy and even rugged tablets for commercial, industrial and military purposes is clear. Fragile consumer-grade equipment may be technologically advanced, but broken is broken.
12-18 MONTHS = TOO LONG.There is a
growing need for a solution with custom
options & capabilities, is sturdy enough, upgradable, and
isn’t obsolete
6-9 Months:Engineering Validation &
Test
6-9 Months:Design
Verification & Test
PRODUCT 12-18
MONTHS OBSOLETE
Starting with “today’s technology” to produce a custom/rugged Tablet:
“New” Rugged / Custom TabletIs based on 12-18 month-old tech:
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Modular: The tablet evolved
New Market:Modular
(Market size - Source: VDC Research Group)
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Price range: $900 - $1,200+ (excluding modules)
Shared Platform – leverage technology across multiple use cases
Longer useful life – avoid early obsolescence
Designed for both commercial & military users – Ruggedized IP66
User upgradable / accessible Secure communications protocols Android & Windows Weight: 2.5 – 3.0 lbs.
A new approach is needed – a tablet suitable for commercial or military and/or rugged use that is:
odem™ Extremely Modular Tablet PCEntegra Technologies
Modular: The tablet evolved
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Example Modules & Options
Modular tablets would typically include standard options such as: Bar code / mag card readers
RFID / NFC
GPS / Location
Front and back cameras
Extended-life battery packs
Bluetooth, WiFi, Cellular (LTE, GSM, CDMA)
Multiple operating system options
Multiple CPU options
Specialized modules & options desired include: Custom / Military
Secure Communications
Interchangeable Environmental Sensors Testing equipment Custom
Integration with Enterprise Data
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Airlines
CPG RetailHealthcare
Restaurants
Prospective Markets
The extremely modular tablet is aimed at markets where consumer-grade or simply rugged equipment is unsuitable, and a more upgradable, updatable and expandable solution is needed.
The slides that follow describe a use case for Airlines.
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Airline Use Case: odem™ Core
odem CoreConfigured for each application
odem
Maintenance
Private Club Flight Attendants
Gate Agents
Flight Crew
Ground Support
In-Flight Entertainment
Check-In
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Functions:• Reduce paper to one backup set per plane• Pilot pre-flight check-in & planning• Flight Plan, Flight Manual, Operating Manual• Jeppesen and Luthansa Lido flight data• Controlled migration from Class 1 to Class 2
without equipment change• Flight Deck Smart Dock Station
• Additional processing & memory for own ship real-time navigation (fast refresh)
• Virus Protection / Firewall• Certified Interface Protection Device• Access to Gate Wi-Fi, ACARS, Iridium, 3G• Synchs tablet to multiple aircraft type• M2M – Aircraft to Flight Ops – updates tablet upon docking with aircraft
Flight CrewFLIGHT CREWTablet w/ Smart Dock & Desktop Dock
Airline Use Case: odem™ Core
Extra odem™ Features
• Wi-Fi, Cellular, GPS, Cyber Encryption
• NFC, Bar Code, Camera, CAC Reader
• Cockpit Smart Dock & Flight Ops Docking Station
FLIGHT CREW
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FLIGHT ATTENDANTSTablet w/ Desktop Dock
Airline Use Case: odem™ Core
Functions:
• Paperless Cabin – convert magazines & catalogs to e-versions
• Flight Crew / Passenger Interactions – personalize the on-board experience with duty free, ordering meals, identifying VIP & top tier passengers
Flight Attendants
Extra odem™ Features
•Wi-Fi, Cellular for Supervisors
•GPS
•Bar Code
•Magnetic Card Swipe
•Camera
FLIGHT ATTENDANTS
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Functions:
• In-flight movies, web browsing, and other customer interactions
• Place duty free orders, messages to/from flight attendants
• Panel Mount – fixed in back of seat and can be removable
• Stand Alone – hand out tablets to premier customers
In-Flight EntertainmentIN-FLIGHT ENTERTAINMENTTablet & Panel Mount
Airline Use Case: odem™ Core
Extra odem™ Features
• Wi-Fi
• Bar Code
• Camera
• Stylus
IN-FLIGHT ENT.
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TICKET COUNTER CHECK-INTablet w/ Desktop Dock & Kiosk Panel Mount
Airline Use Case: odem™ Core
Functions:
• Re-Invent Check-In Process (eliminate queues and counters with roving agents)
• Enhanced CRM (identify VIPs and top tier flyers and their preferences)
• Roving Agents (assist with bag track and trace)
• Passenger Re-accommodation
Check-In
Extra odem™ Features• Wi-Fi, GPS
• Cellular for Supervisors
• 2D Bar Code
• Magnetic Card Swipe
• NFC
• Camera
• Desktop Dock at Counter
• Panel Mount – RJ45
CHECK-IN
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Airline Use Case: odem™ Core
Functions:
• Re-Invent Boarding Process (eliminate queues with roving agents)
• Enhanced CRM (identify VIPs and top tier flyers and their preferences)
• Roving Agents (assist with bag track and trace)
• Passenger Re-accommodation
Gate AgentsGATE AGENTSTablet w/ Desktop Dock
Extra odem™ Features• Wi-Fi, GPS
• Cellular for Supervisors
• 2D Bar Code
• Magnetic Card Swipe
• NFC
• Camera
• Desktop Dock at Counter
• Panel Mount – RJ45
GATE AGENTS
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Airline Use Case: odem™ Core
PRIVATE CLUBTablet w/ Desktop Dock
Functions:
• Watch movies, TV
• Internet Access
• Order food and drinks
• Flight updates
• Tablet and/or Desktop Dock
Private Club
Extra odem™ Features
• Wi-Fi
• Stylus
• Magnetic Card Swipe, NFC
• Desktop Dock w/ keyboard & mouse
PRIVATE CLUB
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Airline Use Case: odem™ Core
MAINTENANCETablet w/ Mobile & Desktop Dock
MAINTENANCE
Functions:
• Eliminate current paper logs and reports
• Real time reporting of aircraft maintenance with ops and pilot
• Techs have complete maintenance manuals and “how to” videos
• Use RFID and GPS to track assets, location of tech, and status of repair
• Applies to line maintenance all the way up to heavy checks
Maintenance
Extra odem™ Features
• Wi-Fi & Cellular Radios
• Bar Code, RFID, & NFC
• GPS
• Camera (front & back)
• Mobile Vehicle Mount
• Docking Station w/ keyboard & mouse
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Airline Use Case: odem™ Core
GROUND SUPPORTTablet w/ Mobile Dock
GROUND SUPPORT
Functions:
• Ground crews have instant access on where and how to deploy around aircraft
• Real time updates on baggage / cargo loading – improves interaction with load planning team
• Use RFID and GPS to track assets (tugs), ground crew, and other support equipment
Ground Support
Extra odem™ Features
• Wi-Fi & Cellular Radios
• Bar Code, RFID, & NFC
• GPS
• Camera (front & back)
• Mobile Vehicle Mount
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Summary & Conclusions
Extreme modularity is the new disruptive innovation that will allow commercial and military users to transcend technology advancements without having to replace the entire computing device – Adaptable, Flexible, Upgradable
Cost effective and rapid incremental end user specific technology upgrades will now be possible with the modular open hardware designs coming to market
In the not too distant future, upgrading the processor in your tablet computer will be as simple as replacing a postage stamp size component on the main logic board
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Summary & Conclusions
In the end, companies need a tablet that fits in the undefined “white space” between consumer and ruggedized tablets that focuses on lower price, smaller size, less weight, increased modularity, and longer useful life.
Steve Carpenter, CEOEntegra Technologies
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References
1. http://online.wsj.com/article/SB10000872396390444657804578048981461803220.html
2. http://www.nextbigwhat.com/pc-sales-decline-tablets-soar-globally-297/
3. http://www.networkworld.com/news/2013/030513-why-moore39s-law-not-mobility-267394.html?source=nww_rss
4. 4 - http://www.businessinsider.com/the-death-of-the-pc-tablet-sales-will-beat-notebook-sales-this-year-2013-1
5. 5 - http://www.pcmag.com/article2/0,2817,2391553,00.asp
6. 6 - http://www.statista.com/statistics/183419/forecast-of-global-sales-of-pcs-by-category/
7. 7 - http://www.idc.com/getdoc.jsp?containerId=prUS23660312#.UQg4L-hNfo0
8. 8 - http://www.statista.com/statistics/200248/forecast-of-tablet-pc-sales-in-the-united-states-from-2010-to-2015/
9. http://blog.vdcresearch.com/mobile_and_wireless/2012/09/growth-in-rugged-tablet-market-trying-to-make-up-for-the-loss-in-others.html
10. http://finance.yahoo.com/news/motorola-solutions-completes-psion-acquisition-104317916--finance.html
11. http://finance.yahoo.com/news/honeywell-acquire-intermec-600m-123622179.html
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About the Authors
Steve Carpenter is President and CEO of entegra technologies, with 36 years experience building global organizations in information technology services, healthcare technology services, customer relationship management, financial services, and retail media with companies including Affiliated Computer Services, ActionSystems, and MediaCart. Contact Steve at [email protected], and www.linkedin.com/in/stephencarpenter.
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About the Authors
Patrick Seaman is Chief Technology Advisor to Pepperwood Partners and COO of the social publishing platform company WhichBox Media. Seaman is the former COO of the video eCommerce company Cinsay, and former Director of Technology at Broadcast.com. Patrick serves on the Advisory Board of Kraftwurx Inc, and Qples, Inc. and on the UT Dallas School of Natural Sciences & Mathematics Advisory Council, and is an IEEE member. Contact Patrick at [email protected], [email protected] and www.linkedin.com/in/patrickseaman/.
Pepperwood Partners© All Rights Reserved March 2013 Page 35
About Pepperwood Partners
Pepperwood Partners is a boutique investment banking advisory firm headquartered in Dallas, Texas. Pepperwood provides a suite of investment banking advisory services to businesses in the technology, media, telecom, nanotechnology, energy and alternative asset sectors. With a strong focus on institutional relationships in the Russian, European, and CIS regions, Pepperwood works with businesses to achieve capitalization and growth objectives.
Two Lincoln Centre5420 LBJ Freeway, Suite 535Dallas, Texas 75240 USA+1 [email protected]
Learn more at: www.PepperwoodPartners.com