The Small and Medium Business Tablet OpportunityBy Ericka Chickowski | Posted 2011-04-13 Email Print
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Small and medium business can gain big in revenues by leveraging tablet computers, but the market is still barely penetrated, leaving plenty of room for IT solution providers.
SMBs are could drive the tablet market in the coming years as business owners are made aware of the benefits these devices afford to the bottom line, but organizations must be ready for increased bandwidth requirements, reported the experts from analyst firm AMI-Partners.
According to AMI research, SMBs that have embraced mobility trends generated 40 percent higher revenue growth in the past year compared to those that did not. AMI analyst Michael McDonald says that SMB adoption of tablets will accelerate in the next two years due to a number of factors, including increased broadband speeds and heightened competition that will drive down prices. AMI predicts that tablet prices will drop by 50 percent by 2013.
"SMB tablet adoption has been highly fragmented across industries," McDonald says. "We see the strongest interest in professional services, healthcare, hospitality, and the media businesses. The early adopters realize the intrinsic value in having a highly mobile device that enables users to immediately access data, process information, and respond accordingly."
In spite of the expected price erosion predicted by AMI and the likely drop in margin that will ensue, channel partners could stand to benefit greatly from the SMB's attraction to the tablet through the bundling of network and cloud services with these devices.
The tablet PC has almost limitless potential in the SMB space where the device can entrench itself as a valuable resource essential to the on-the-go businessman. The ability of manufacturers, software providers and service providers to adapt to the changing demands of business users will be critical to future success."
AMI says that the increased load these devices have put on networks has led to SMBs using tablets to bump up their bandwidth speeds--these firms typically have 10 percent faster speeds than companies without tablets. Firms with tablets are far more likely to utilize SaaS applications and hosted collaboration and productivity services.
"The tablet PC has almost limitless potential in the SMB space where the device can entrench itself as a valuable resource essential to the on-the-go businessman. The ability of manufacturers, software providers and service providers to adapt to the changing demands of business users will be critical to future success," McDonald says. "Firms that have embraced tablets are also increasingly moving additional resources to the cloud, increasing the utility of the tablet."
Small and mid-sized businesses (firms with less than 999 employees) continue to strive to regain their place in a troubled economy. Recent AMI research indicates that SMBs who have embraced mobility generated 40 percent higher revenue growth over the last 12 months compared to those who did not. As the mobile workforce trend continues, mobile devices, including tablet PCs, will play an integral part in supporting these employees.
"SMB adoption is expected to accelerate as broadband speeds increase and heightened competition drives prices down. We expect average prices to drop nearly 50 percent by 2013," the firm said.
Until recently, smartphones and notebooks have been the primary tools to process information wirelessly. Tablets are quickly stepping in as a complementary and capable device. But worldwide SMB tablet penetration remains low, about 3 percent, and still has a long way to go before becoming a mainstream IT asset.