CES: Tablets Steal Show; Motorola, RIM Tablets in Focus

2011 would possibly become the year of the tablets and 4G phones, as seen from the recent International Consumer Electronics Show (CES) held in the Las Vegas Convention Center, Las Vegas, Nevada.

As expected, nearly every major original equipment manufacturer (OEM) either introduced or showed a tablet at CES, but the spotlight was on the Motorola XOOM that was the first tablet based on Google Inc.'s Honeycomb (Android 3.0) operating system. The operating system is specifically designed for large screen tablets.

The 2011 CES brought top CEOs to the stage including Microsoft Corp.’s Steve Ballmer, Verizon’s Ivan Seidenberg, Audi’s Rupert Stadler, Samsung’s Boo-Keun Yoon, Ford’s Alan Mulally, Netflix’s Reed Hastings, Cisco’s John Chambers, Xerox’s Ursula Burns and GE’s Jeffrey Immelt. These executives were joined onstage by leaders spanning various industries including Comcast’s Brian Roberts, Time Warner Cable’s Glenn Britt, Dreamworks Animation’s Jeffrey Katzenberg and Hulu’s Jason Kilar.

More than 140,000 people attended the show, compared with 126,000 at the annual event last year, according to the Consumer Electronics Association (CEA) trade group behind CES. More than 30,000 attendees came from outside the United States, with the show attracting more than 80 international delegations.

Major technology trends emerged from the CES show floor including the launch of more than 80 tablets, wireless 4G LTE, connected TV technologies, smart appliances -- featured for the first time in show history -- and electric vehicles. Ford’s Alan Mulally unveiled the company’s first electric car at the 2011 International CES with its Ford Focus Electric.

Also, many 4G phones were unveiled at the show, including the LG Revolution, Samsung Infuse, HTC Thunderbolt, Sony Ericsson Xperia Arc, Motorola Cliq 2, Motorola Droid Bionic, and Motorola Atrix 4G.

The XOOM tablet features 10.1-inch display (1280 x 800 pixels), weighs in at 730 grams, has a dual-core NVIDIA Tegra 2 processor with 1 GHz speed, contains a memory of 1GB RAM, a camera of 5 mega-pixels with video capture of 720p HD, additional camera of 2 mega-pixels, internal storage of 32 GB, supports Wi-Fi 802.11b/g/n along with 3G, 4G LTE upgradeable option and also has built-in online services support like Facebook, Picasa and Twitter.

According to Motorola, the XOOM tablet will have a Li-ion battery which will last more than 10 hours, if that is true then Motorola Xoom will be the first tablet to outmatch Apple Inc.'s iPad in terms of battery life.

Motorola XOOM device will launch as a 3G/Wi-Fi-enabled device in first quarter of 2011 with an upgrade to 4G LTE in second quarter. Starting in second quarter of 2011, the Motorola XOOM will be a 4G LTE/Wi-Fi- enabled device, according to Motorola. And Verizon Wireless will be the carrier for the tablet.

Motorola was selected as the hardware partner as the Google Experience Device (GED) for Honeycomb along with Nvidia, Atmel, Maxim, and Broadcom on the semiconductor side.

In addition to the tablet, Motorola's Atrix 4G handset was a stand out. Vizio surprised everyone with an impressive smartphone and tablets as well as a compelling 3D TV, requiring only passive glasses. Initial glimpses of Android 3.0 (Honeycomb) received even better reviews than expected due to its sleek user interface.

While we liked the XOOM tablet and Honeycomb, we are not fans for the hardware upgrade required to get the XOOM tablet to 4G, but we did like the Atrix. First quarter and long-term competitive threats keep us on the sidelines. XOOM tablet is coming a twinge later than we thought and the hardware upgrade seems like a pain, said Adam Benjamin, a technology analyst at Jefferies & Co.

Atrix was thoroughly impressive by the 4G smartphone AT&T, Bell Canada, and Orange UK (two 1 Ghz processors, 1GB RAM, QHD display, Android 2.2 (Froyo), innovative fingerprint reader). But we think the desktop and laptop docking accessories will be a tough sell for most unless pricing is rock bottom, Benjamin said in a note to clients.

But the Blackberry maker Research In Motion (RIM) doesn’t fall behind, as they have quite bit of business customers around the world for their products, so PlayBook is sure to have good number of consumer’s intake. The RIM booth received high interest, and the Playbook received good reviews.

RIM has announced the arrival of 4G PlayBook through Sprint on summer 2011. A reason why RIM has opted for using Sprint is for Sprint’s 4G network. Sprint was the only 4G network provider for almost two years now with no other player around.

But that will change once Verizon and AT&T comes out with 4G network, which have more subscribers standing in at number one and two positions respectively while Sprint being the third. We feel that that the 4G announcement with Sprint is only the beginning with more carriers to come, said Benjamin.

RIM’s BlackBerry PlayBook features a 7-inch display (1024 x 600 pixels), the BlackBerry Tablet OS (QNX), 1GHz Cortex-A9 dual core processor, 1GB RAM, a 3 mega-pixel camera and a 5 megapixel camera, Wi-Fi (802.11a/b/g/n) support, weighs in at 400 g and the tablet is expected to come in 8GB, 16GB,32GB and 64GB.

When it comes to battery life, RIM has revealed that the tablet will last as long as or longer than other 7-inch tablets that means it may have a 6 hours of battery life similar to Samsung Galaxy Tab, another 7-inch tablet in the market. And the pricing is also not yet revealed, but the company said the tablet will definitely be priced under $500 mark.

QNX-based handsets are coming much sooner than expected, in our opinion. Playbook demos were swamped, and according to FourSquare their booth had the most traffic. It was certainly packed. We think QNX is one of the best operating systems on the market with a very compelling UI, multi-tasking, and high levels of developer support, said Benjamin.

Benjamin feels more confident with his view that QNX handsets will be unveiled by September, well before bears think. Benjamin believes prototypes exist, but he was unable to confirm their existence at the show.

10” Playbook: we expect a launch this year. Our Blackberry worked at CES despite congestion. Our iPhone 4 was unusable at CES events due to bandwidth overload. People truly will come to appreciate this in the future, said Benjamin.

Our discussion with channel partners indicate RIM's inventory levels dramatically depleted throughout December, ending the month with some channel partners scrambling. Seems every device sold in was sold through, as we expected, Benjamin said in a note.

The other OEMs took two different approaches: they introduced a GED based tablet with Gingerbread (Android 2.3) tablet, or they announced a tablet that will 'ship' with Honeycomb.

For this reason many of the tablets were actually behind glass and/or were not fully working. We expect to see these Honeycomb tablets from the other OEMs ship 30-60 days after the Honeycomb code is released (expected some time in March), said Adam Benjamin.

Given this timing, Benjamin believes Computex in early June to be the first real look at the competitive landscape. From a semiconductor perspective, Benjamin expects the GED suppliers (Nvidia, Atmel, Maxim, Broadcom) to have over 75 percent of the Android tablets in first half of 2011 and well over 50 percent for 2011 as designs from other semiconductor suppliers reach the market.

Benjamin believes the next focus for investors will be on the potential GED partners for Android Ice Cream, which is expected to be launched in mid to late 2011. In terms of the sizing of the tablet market, there was literally no component suppliers or OEMs that would sign up to 2011 volumes as the market is still too new and unproven.

Benjamin continued to hear similar estimates -- in the range of 30 million to 40 million for Apple and 10 million to 30 million for non-Apple OEMs -- yet it is difficult for anyone to know given that the major launches are happening in an unseasonally strong first half combined with the looming introduction of iPad2 in late first quarter.

Benjamin did hear that first half volumes are likely to be insignificant and that second half is really what the tablet OEMs are targeting in terms of material volume. Benjamin said tablet market will be positive for Nvidia, Atmel, Maxim and Broadcom, while it might have a negative impact for Intel, AMD and Intersil (power management).