Apple May Go Big with the iPad Pro for Enterprises
Notable Changes in the Enterprise Device Market
Bigger iPad would resolve some cannibalization issues
Apple (AAPL) is reportedly planning to launch a bigger iPad, measuring 12.9 inches. According to a report from AppleInsider, Apple’s iPad Pro will include a near-field communication (or NFC) radio chip. This feature would allow the iPad Pro to act as payment-receiving device for Apple Pay. The report also mentions that the iPad Pro will have some attractive features such as an improved touch interface and a Bluetooth stylus.
Aside from the improved features, why would Apple launch a bigger iPad? It is well known that Apple is struggling to control the decline of its iPad sales. As the chart below shows, Apple’s iPad units sales declined from 16.4 million in fiscal 2Q14 to 12.6 million in fiscal 2Q15, a 23% decline on a year-over-year basis.
iPad Pro designed to appeal to enterprises
While announcing the fiscal 2Q15 earnings, Apple acknowledged that its iPad business is being cannibalized by the iPhone on one end and Mac products on the other end. Apple also mentioned that the iPad’s performance was muted in most of its markets, except Japan (EWJ) and China.
In our February 2015 article Apple and Samsung hit by holiday drop in the tablet market, we discussed how low-cost tablets based on Google’s (GOOG) Android operating system are gaining share in the tablet market at the expense of Apple and Samsung.
Bigger iPads would resolve this issue to some extent. Seeing the potential of larger tablets, Microsoft (MSFT) also introduced the Surface Pro 3 tablet last year. This was Microsoft’s largest-ever tablet with a 12-inch screen size. Microsoft claimed this tablet could replace laptops, serving a dual purpose as a tablet and a laptop.
A bigger model would make the iPad more appealing to enterprises, as it would also act as a productivity tool similar to a laptop. Apple is already optimistic about its partnership with IBM (IBM), which it anticipates will help boost iPad’s penetration in enterprises.
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