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Hi, I’m Brad Feld, a managing director at the Foundry Group who lives in Boulder, Colorado. I invest in software and Internet companies around the US, run marathons and read a lot.

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The Wave of iPad Purchasing Has Just Begun

Comments (29)

It’s fascinating to me when a new product aggressively shifts from early adopters to the mainstream. It should be no surprise that the day the iPad came out a bunch of them appeared at the Foundry Group offices. At the next board meeting I was at, I think every VC had one and was using it in the meeting presumably to view their board package (although I caught at least one checking his email throughout the meeting.) When the Kindle for iPad app appeared, I started toting my iPad around with me everywhere until I kept forgetting to charge it, at which point I went back to my Kindle for reading.

At my birthday on December 1st, I gave everyone that attended (including Amy and my partners) an iPad. I was surprised how much everyone loved them – I know that for some of them it was the jedi master trick of giving your birthday party attendees a gift, but for several, including the non-technologists / non-nerds at dinner, there was real delight with this newfangled device.

I repeated the trick at the Foundry Group holiday party and gave everyone at Foundry Group an iPad. Well, I started out by giving them an iTunes card for $50 which everyone seemed to like, but then went back to the gift well a few moments later for the real gift.

Today, I read that the city of Boulder is mulling iPad purchases for all council members in order to save paper, staff time, and money. A college that I’m familiar with is considering getting an iPad for every board member to go paperless on board packages and other communication. I got an email from an exec (and friend) at a major software company who is rolling out their product on the iPad which should dramatically improve the iPad’s ability to interact with legacy enterprise systems.

At CES, there were 60+ tablets. One was from RIM, the other 59 were built on Android. The only one that impressed me was the RIM tablet – the Android ones all were slick but materially inferior to the iPad. As a result, I made a mental note to myself a few weeks ago that I thought Apple had very clear sailing in front of it for another year, although as with smart phones, there is no question that Google / Android will grind away hard at this market and given the incredible hardware distribution and amazing software talent at Google, will make real inroads.

Microsoft was no where to be seen. Yeah, there was a little chatter and a few demos of Windows on tablets, but if you remember how poorly this has gone the past two times Microsoft tried to put Windows on a tablet, I think you are probably in the same boat that I’m in which is that Microsoft is going to have to take an Xbox or Windows Mobile like approach to their tablets (e.g. completely new software OS stack and UI than “Windows”) if they want to get in the game.

My conclusion – the wave of iPad purchasing has just begun. The iPad 2 is expected soon (maybe this quarter, certainly next quarter) – I think it’s going to be an absolute monster success.

  • http://twitter.com/flafeer Firoze Lafeer

    I agree that the wave has just begun. As for Microsoft, as an iOS developer myself I’m actually extremely impressed with the Windows Phone 7 development platform. As you say, they took a fresh Xbox like approach that turned out very well. It would be an epic mistake for them to NOT port WP7 directly to a tablet. But sadly, management will probably cave to the powerful internal old Windows lobby on this one. Too bad.

  • http://MeetInnovators.com Adrian Bye

    i think the big story is actually a combination of the ipad + amazon AWS style cloud services. when you can move more desktop intelligence over to the cloud, and have more simplified devices as the desktop, the whole complexity of managing a desktop computer can finally go away.

    this will likely be the death of microsoft if they don’t find a way forward.

  • http://www.replicatorinc.com Joseph Flaherty

    Brad, just curious why you think it is inevitable that Android will get a foot hold in this market? It seems like tablet computing has more in common with the iPod than the iPhone. Subsidy and carrier issues led to the growth of Android, but in the audio player market Apple still enjoys ~80% market share. I’m not sure Android tablets will be able to crawl back into the game after Apple gets a 2 year lead in the world of apps, similar to the way no credible audio players got traction after Apple had iTunes and all the music labels signed up.

    • http://twitter.com/timflint Tim Flint

      Those are great points about why Android might not make a hold. I agree it will likely be harder for them to take a strong position in this market, but I think many consumers want their tablet to be an always on device. Which creates a similar carrier issue as with phones. Also, I think there is a desire for different sized tablets which opens up the market a bit more for other competitors to compete against the iPad as well.

      • http://www.replicatorinc.com Joseph Flaherty

        Tim, You make good points as well, I won’t be surprised to see a smaller tablet from Apple in the future though. Even though SJ has said they think they are too small, a version will come out optimized for ebooks, replacing navigation systems, and all the other tasks the smaller tablets do well with. Apple is too retail savvy not to take that lower price segment on. My big point is people are giving Android too much credit. While its awesome its not in league with iOS an if it is a cash pay product I don’t see someone realistically buying a Samsung tab without a massive subsidy.

    • http://www.feld.com bfeld

      I think it’s a huge mistake to underestimate Google / Android in the
      tablet market. Microsoft is focused on controlling / owning the
      hardware so every other hardware manufacturer (Samsung, Sony, LG,
      etc.) who also has a CE business needs a competing product. They have
      two choices – Android or Microsoft – since RIM looks like it wants to
      control the hardware also.

  • http://www.victusspiritus.com/ Mark Essel

    Those gifts were very generous, and I agree that we’ve only just seen the beginning of tablets enter mainstream. My wife and I enjoy the iPad, but I’m looking forward to the iPad 2 and beyond for reading after being spoiled by the iPhone 4 crystal clear resolution.

  • Walterwong1

    Happy Belated Birthday! Nice Jedi trick.

  • http://twitter.com/sardire Steve Ardire

    I agree that the iPad 2 is going to be an absolute monster success

  • http://twitter.com/aumg Gregg Borodaty

    The iPad, or any other tablet for that matter, does not strike me as a mainstream consumer device. Sure, for us technologists in our echo chamber, it’s the greatest thing since sliced bread, and for the enterprise and education examples you point out (as well as retail), it has a lot of advantages. However, for the mainstream consumer, I don’t get it. Unless it can replace either my laptop or my smartphone, why do I want to drop $600+ on another device that does the same thing as my phone, just on a larger screen, and does less than my laptop, which is the same price (or less). The tablet market feels like another product that tech companies make me want to believe I need, rather than solving a real problem or need that I have. For example, all of my tech friends who are not independently wealthy, don’t understand the hype around the iPad, nor do they care. I apologize for pouring some cold water on the party here, but just because Steve Jobs says that the iPad is magical doesn’t necessarily mean that it is.

    • http://www.feld.com bfeld

      Having watched my mom use it, my dad use it, my brother’s wife (which
      is not a tech person) use it, I have to respectfully disagree with
      you.

      • Versa

        Except for the touch screen and the convenience of size, I think the ipad does not have much to recommend it for the money you need to spend and there are snags in printing, playing videos, compatibility with main stream software etc I do not find much use for most of the applications except for things like ipod

    • James Mitchell

      Gregg, what the iPad offers is a different form factor. I love my notebook PC but carrying around an iPad would be much easier.

      If nothing else, the iPad could be a great book reader. 7 inches is just the right size for a book reader, in my opinion.

    • Anonymous

      I have To disagree as well. If you think it won’t be a mainstream device then you’ve been asleep for the past few months. It is mostly non-tech types buying it these days. Why? It’s a great format for reading books or watching movies. Bigger than a phone, but not as bulky as a notebook. It has decent email and web browsing for the times and places where a laptop is too much work to haul out. I think we have only seen the tip of the iceberg here.

      • http://twitter.com/aumg Gregg Borodaty

        Thanks for the feedback. I should have added one phrase to my opening statement – tablets, as they are defined today, are not mainstream. Once tablets can replace notebooks, then they will be. Alternatively, it’s possible that notebooks could replace tablets. Look at the current generation of MacBook Airs – if it had a touchscreen, iOS mode, and could be folded to a tablet form factor, it would give the iPad a run for its money.

  • http://roberthackerbooks.com/ Robert Hacker

    Android will succeed as Brad says when $100-200 Android tablets now available in China enter U.S. market in a big way in 2011 or 2012. A good distribution strategy will be a key factor.
    More interesting will be to see how the RIM and HP tablets do with their proprietary operating systems and whether screen size of 8.9″ turns out to be a key selection factor.

  • Dave Blakelock

    Another data point is the school system here in Needham is planning on buying iPads for one cluster (100 students) of Middle School Students as an experiment.

  • Scott Brook

    I am starting to see various enterprise sized companies purchasing iPads for their sales force and that will percolate to the productivity user. I, like many of my colleagues, have passed on version 1.0 and waiting for 2.0 to jump in. There is no doubt that the growth of all tablets will be exponential and even though Apple’s share may shrink, it will be still be several times the sales of this year.

  • http://www.investingwithoptions.com/ steveplace

    Hey Brad, saw this on HN tonight, I know you are big on personal data collection, so I thought I’d share:

    http://news.ycombinator.com/item?id=2133665

    Copy and paste sucks on the ipad but im pretty sure that link works

    • http://www.feld.com bfeld

      The link is dead. What’s the name of the article?

  • Inboulder

    As our company is developing educational software for the iPad, I’d love to see them become ubiquitous, but in the board room is just not a place I would expect them to last. I remember in 95 or so every apple executive carrying a newton into meetings, and then furiously trying to take notes, but giving up after a few minutes, and this was a device built for note taking. For passive display the iPad is great, for note taking or any kind of high input, it’s not built for the job.

    • http://www.feld.com bfeld

      I find them to be ideal for reading board packages during the meeting
      which are either PDFs or PPTs. I never take notes so that’s not an
      issue for me. I have seen others take notes on paper while using the
      iPad to read the docs.

  • CV

    Brad, did you happen to play with the Xoom while you were in Vegas? If so, thoughts?

    • http://www.feld.com bfeld

      I didn’t.

  • Help+dummy

    Test

  • http://urbanpiscivore.com Ryan

    After getting an iPad for free, it is definitely useful. However, I still don’t think the price is worth the value added

  • FAKE GRIMLOCK

    IPAD AM CUTTING EDGE DEVICE FOR NORMAL PEOPLE. THIS BREAK BRAINS OF TECH NERDS, EXPLAIN WHY THEM ALL INSIST MILLIONS OF PEOPLE BUYING IT AM SURE SIGN IT COMPLETELY UNPOPULAR AND USELESS.

    THIS SAME REASON WII SUCH GIGANTIC FLOP. NINTENDO SO STUPID TO SELL THING EVERYONE WANT INSTEAD OF THING ONLY TINY NUMBER OF GEEKS WANT.

  • http://jjeffryes.com J. Jeffryes

    I work with many people that are lower and middle class, and I’ve been blown away by how many non-techy, non-early adopter people own both iPhones and iPads. For almost all of them, it’s more desirable than a computer, because neither device comes with all the (to them) useless, confusing BS that your average computer geek thinks is important.

    This is an idea completely absent from the competing Android tablets that are available. I think Apple is going to completely crush the market with a huge wave of mainstream people buying the iPad 2 and the price-dropped iPad 1.

  • Guest

    Double post.

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