The Growing Demand for Smaller Tablets

By now, I am sure you have heard a lot of reports that Apple is for the near future. I don't know if this is true or not but it turns out that 7-inch tablets are becoming a rather important product in the market.

Until Amazon brought out the , a lot of industry folks really questioned the value of the 7-inch tablet. In fact, Steve Jobs himself dissed the idea at an AllThingsD conference I attended a few years back. I never took his disapproval of this 7-inch category too seriously, though, because I was with him when he said he would not release a smartphone, but as you know, two years later he did exactly that.

What has become clear, thanks to the Kindle Fire, is that there is now a real demand for 7-inch tablets as media consumption devices, an important distinction for models of this size. The iPad has proven that even though Apple initially positioned it as a media consumption device, the company hedged its bets that it could cross over to a productivity tool by introducing Pages and Numbers for it at launch.

By the time Apple introduced the , it started to highlight its role in productivity and started to share how corporations were using it in their businesses. The iPad has now proven itself to be quite versatile in handling both media consumption and productivity rather deftly.

When it comes to media consumption, though, the 7-inch tablets are even more ideal. They are smaller and lighter but more than capable for viewing mobile movies, listening to music, and even reading magazines. What's more important is that early studies are revealing that Generation X and Generation Y users are more than comfortable using this smaller screen tablet while older generations covet the larger versions.

In fact, some of the major publishing houses are excited about the 7-inch models because they see it as dramatically expanding market demand for ebooks and digital magazines. Although I find reading magazines on the iPad to be a better experience since there is less scrolling involved, a 7-inch tablet still does a decent job and, of course, it is an ideal size for an ebook reader.

All the news around this makes me think there is some truth behind at least the idea of an iPad Mini, leaving an interesting question on the table for Apple. I have to believe that if it comes to market, it will be more like a larger iPod, assuming its goal is more media consumption-focused. So, Apple, should it have the or iPad moniker? Given its competition is calling the 7-inch models "tablets," it would be hard for Apple not to call it an iPad. At the same time, it needs to make a major distinction between the focus and use of the products, besides price. It will be interesting to see how it names this still-theoretical product.

It is now clear, however, that there is real demand for 7-inch tablets and that will not wane. Although growth of the models is flat at the moment, new products in this category from Google and Amazon will make them the hot tickets this holiday season. Can you imagine what a scramble it would be if Apple got into this space too? We could have one of the hottest tech holidays we have ever seen.

One other question worth pondering is how tablets of either size will affect laptop purchases. I have seen a couple of studies that suggest it will decrease demand for laptops by as much as 20 percent come the end of this year. Microsoft's tablet with keyboard blurs this area even more, but it is important to remember that people use technology to handle specific needs. A 7-inch tablet is really too small for any serious productivity usage, while the iPad with a keyboard does quite a good job, up to a point, with productivity apps.

I find that when it comes to heavy lifting tasks like editing large documents or spreadsheets, even the iPad falls short in functionality. This gives me much more hope that the new breed of ultrabooks will strike a chord with people and that they will also be big sellers this holiday season.

The bottom line is that demand for tech products will be on a very strong upswing by the end of the year and these new 7-inch tablets will make up a lot of the volume. I also expect continued demand for Apple's original iPads. Ultrabooks should also be hot items for various end-of-year markets. Gartner has revised its numbers for 2012 and now suggests that the PC market will be up three percent this year, but that excludes tablets. Add them to the mix and we actually could have a rather healthy 2012 and one of our strongest tech years in a long time.