Neowin.net

After a slow start, tablet personal computers are starting to take off, fueled by Microsoft Corp.'s release of its operating system Windows XP Tablet PC and manufacturers rolling out a wider variety of easier-to-use devices.

Since Microsoft's launch of the Tablet PC in November, the devices have grown in popularity, benefiting from the more user-friendly software and improved hand-writing recognition technology. And Microsoft's OneNote application that allows Tablet PC users to write notes in digital ink -- either with a keyboard or a pen -- goes on sale next month.

The idea for the tablet PC -- a portable device to allow users to enter data with a pen-like stylus -- had been percolating quietly ever since chipmaker National Semiconductor Corp. announced a design in the dot-com boom years for a simple Web-browsing pad that manufacturers could use to make the devices.

Unlike price-pressured desktops, tablet PCs are able to command premium pricing -- ranging from about $1,000 to about $2,300. They are now sold by major PC manufacturers such as Hewlett-Packard Co., Acer Inc., Toshiba, NEC, Fujitsu, and Gateway Inc.

And the growing demand for the tablet PC has been helped by faster microprocessors, cheaper memory and the proliferation of wireless Internet connectivity, known as WiFi.

"We're in the very early stages of what effectively is nascent demand in the tablet market," said Alan Promisel, an analyst with market research firm IDC. "Looking forward, I think the demand potential for tablets is pretty high."

News source: Reuters - Tablet PCs Starting to Take Off After Slow Start

Promisel said that Microsoft's release of Windows XP Tablet PC last November has helped in pushing the tablet PC, in no small part because Microsoft has more than a 90-percent share of the market for PC operating systems.

"It really does add a whole new layer onto Microsoft Windows XP," Promisel said. "It allows you to take digital notes and hand-write e-mails."

The proliferation of WiFi, or high-speed wireless Internet access -- among corporations, on university campuses and even in cafes such as Starbucks -- has also helped spur growth of the tablet PC, analysts said.

And while Promisel said there will be a consumer market for tablet PCs -- such as college students taking them to class for note-taking and such -- what really needs to happen for the tablet PC to take off is the development of new software applications for corporate customers.

"The technology is there, but the main stumbling block is the lack of applications," Promisel said. "In many people's minds there still lacks that one application that can be extended across all markets that makes the tablet a true productivity-enhancing device."

But it's starting to happen. Doctors' offices and real-estate offices are among the vertical markets that are embracing the devices, Promisel said.

BROADER PRODUCT LINES, FASTER GROWTH

There is a wider variety of tablet PCs available now, too, and they have much of the functionality of a regular PC, with e-mail, spreadsheet programs, word processing, Internet browsing, and other standard applications.

So-called convertible models look much like a standard notebook PC, with attached keyboards. But when you want to use it as a writing pad, you rotate the screen 180 degrees and lay it back flat against the device to take notes and for tablet pen input.

The other major design type of the tablet PC, the slate model, is slimmer and lighter in weight than the convertible type. They are designed to be easily "docked" at a desktop PC to use the PC's large-screen monitor, keyboard, mouse and other peripherals.

The portable PC segment, which includes standard notebook PCs, has for the last three years been the fastest growing part of the overall PC market, and has long been more profitable than the desktop PC market, with its razor-thin profit margins.

As the PC market has matured, slowing to single-digit percentage growth rates in the United States, PC makers -- along with Microsoft, Intel Corp., Advanced Micro Devices Inc. and others -- have been angling to come up with new and different designs and uses for technology to spur sales.

Promisel said that his firm predicts that in 2003, a total of 500,000 tablet PCs will be sold around the globe, which represents about 1 percent of the total portable PC market.

But, by 2007, IDC forecasts that the tablet PC could account for well over 20 percent of the portable market.