Smart Money: Where There's Mobility, There's Margin

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So, the mobile OS has been chosen. But what about the actual device? In the case of iOS and BlackBerry, the decision's already been made—the OSes are tied to proprietary hardware. But when it comes to Windows and Android, there are a host of OEM offerings and therefore more decisions to make, especially on the tablet side. While solution providers say most business users prefer a 10-inch display, there's a growing movement to smaller tablets. D&H Distributing, for example, said it's seen a huge increase in sales of 7-inch tablets such as the Google Nexus 7 from Asus. And with the growth of smaller tablets comes pricing pressure. "The $169 price point for HP's new [Slate 7] Android tablet is very aggressive," said Jeff Davis, senior vice president of sales at D&H, "and I think we're going to see more of that as the year goes on."

Consumer-focused Android tablets are selling for as low as $99 today, while on the high end of the scale, models like the Microsoft Surface Pro with 128 GB of storage can top $1,000. It's quite a range, but solution providers say pricing tends to be less of a factor with tablets than PCs. Why? In the case of the shift toward BYOD, users are willing to pay more for what they want. "It's more expensive for corporations to buy devices, but people have passion around their device and applications around it," said IBM's Barlow.

As for size and form factor, there are also larger tablets like Samsung's Windows 8-based ATIV Smart PC, which boasts an 11.6-inch display. Despite its name, the ATIV Smart PC is a tablet that can connect with a docking keyboard station and it's one of many new hybrid tablet-notebook models to arrive this year. HP, for example, recently unveiled not one but two new hybrid devices—the HP Split x2 for Windows 8 and the HP SlateBook x2 for Android.

Bill Hair, president of My Computer Guy in Rockwall, Texas, sees big potential for hybrid devices that combine the functionality of a notebook with the portability of a tablet. "Hybrids are big right now," Hair said, "and I think interest is growing." There are more form-factor criteria to be considered, too. Some tablet vendors are focusing more on battery life to appeal to business users. For example, the HP ElitePad comes with an expandable battery jacket and docking station, while the Dell Latitude 10 Windows 8 tablet is one of the few tablets around that has a replaceable battery.

All in all, there's a plethora of Windows 8 and Android tablets that are challenging the iPad's dominance. Solution providers say Samsung and Lenovo are two of the stronger contenders. "Lenovo is extremely popular right now," said Rob Robinson, owner and president of Computer Upgrade King in Midlothian, Va. "Along with Samsung, I'd say they're the two that are doing the best in the tablet market." But that demand could shift depending on the next great device or platform innovation, which is probably lurking just around the corner. If the mobility revolution has taught the channel anything—aside from the margin lesson—it's that things in the mobile devices market can, and probably will, change quickly.

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