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Tablet PC hasn’t been successful: report

That’s the result of a new study from high-tech research firm In-Stat/MDR. It says that the device, which was designed to counteract sluggish commercial PC sales, has been adopted in vertical markets, such as health care, real estate, and insurance. However, horizontal commercial markets have been somewhat hesitant to adopt a new PC form factor in a world of slow-growing IT budgets.

“Many vertical markets were accustomed to pen-based computing, and saw the Tablet PC as giving them the flexibility of pen-based computing plus access to all software that runs on Microsoft’s XP operating system,” said Brian O’Rourke, a senior analyst with In-Stat/MDR. “As a result, the vast majority of Tablet PCs that shipped in 2003 went to vertical applications.”

Within horizontal markets, Tablet PCs are particularly targeted at large enterprises. But, according to O’Rourke, “with limited IT budgets in the early part of this decade, and forecasts for annual increases in the 3 per cent range over the next four to five years, enterprise IT managers have been hesitant to take a chance on a new PC form factor.”

That will slowly change, as prices continue to fall, the report says, It projects that as Tablet PC prices come down over the next few years, and Tablet PC software offerings increase, interest in horizontal markets will rise. Horizontal markets should start to make an impact on this market in 2005, as average selling prices fall below $2,000 for the first time.

In-Stat/MDR also thinks that additional Tablet PC offerings over the past year should have a positive impact on the market. In 2003, Microsoft released Office 2003 with digital ink support, and this summer they will be releasing the Windows XP Tablet PC 2005 Edition that will offer a number of improvements that will enhance the utility of the Tablet PC.

Tablet PC vendors have also been offering enhancements and new form factors to increase their popularity. In late 2003, both Gateway and Acer released Tablet PCs with 14-inch screens and Acer released the first true clamshell notebook with the Windows XP Tablet PC operating system.

But, the report notes, if the Tablet is going to make it anywhere, it will have to be in the commercial market. To date, there has been little consumer interest in the Tablet, and that, the report says, is not likely to change.

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