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Who Can Challenge Apple In Tablets?

This article is more than 9 years old.

Before the iPad popularized tablet computing and introduced consumer uses of tablets, they had already been established for decades in the commercial sector as mobile data capture devices with brand names like Symbol, Intermec , LXE, Psion, and Vocollect.  In recent history, the industry has consolidated, and many of these firms have been absorbed into two industry giants, Honeywell International and Motorola Solutions .

Companies like Fujitsu and Panasonic have also been serving the mobile data capture business with terminals standardized on Microsoft and Intel as well as with highly specialized terminals.

When Microsoft tried to commoditize tablets in 2002 with Windows XP Tablet PC Edition, the PC makers weren't sure how to target systems at real buyers.  Here’s a saga of product development in that environment.  Microsoft implied that consumers were a genuine market, but no one had cracked that code, and the technology of the time was too expensive, clunky, short-battery-lived, and difficult to use.  Consumer — or consumerized — applications were still off in Apple ’s future.  So, many PC makers turned to the traditional verticals that had been buying tablets right along.

There, they found entrenched players, particularly Panasonic in ruggedized forms, but companies like Fujitsu also managed to make some headway applying industry-standard economics to specialized markets.

Once Apple solved the puzzle of the horizontal tablet market, its subsequent rise obscured the traditional verticals, which were still humming along.  But Apple — with its simple interface and aggressively priced hardware — enabled new markets, like front-of-house food ordering and iPads even began turning up in traditional tablet verticals with rugged casing.  A turf war ensued.

Luckily, or really a matter of sheer persistence, Microsoft has brought Windows tablet features more closely together, and the environment is more intuitive and functional as of the latest edition of Windows 8.

A recent example of how the traditional suppliers are responding to Apple is the introduction of the Toughpad FZ-R1 by Panasonic, which is an Endpoint customer.  You can tell by the name that this device is not aimed at consumers.  Here’s a quick brand test: read this paragraph again, then look away.  Now, can you tell me the name of the product?  I thought not.  I’m not sure I could pass the test, and I wrote this.

The 7” Toughpad FZ-R1 joins a lineup of Panasonic tablets that include 5”, 7”, and 10” models running either Microsoft’s Windows 8 or Google ’s Android.  The FZ-R1 is designed specifically for the mobile point-of-sale (POS) market.  It has business-rugged features, long battery life, payment security, and a sleek design.

Future-proofed for new payment standards, the FZ-R1 comes with two central processors — one for the payment module and one for tablet operations.  They’re separable, but fully integrated.

For a POS application, of course, security is fundamental.  At its core, the FZ-R1 is built on an Intel processor and a TPM hardware security module.  The device comes certified to the latest payment card industry security standard, including its PIN-pad requirement.  The unit has a designed-in reader for Europay, MasterCard , Visa (EMV) chip-based cards as well as one for near-field communication (NFC), which is used for wireless transactions, and a magnetic-stripe reader for the type of credit and debit cards mostly in use today in the United States.

There are those betting that Apple Pay will beat EMV in the U.S. market, but most of the world has already gone over to EMV, the result of something called “liability shift.”  Under liability shift, the responsibility to ensure a safe transaction shifts from the credit-card company to the merchant — if the merchant hasn’t implemented EMV.  So, the credit-card companies’ forcing of the issue will rather motivate EMV adoption — even in the United States, where major card providers will institute liability shift this coming October.

The target markets for this tablet are precisely those new areas that Apple products opened up: the in-store, on-the-floor, with-the-customers, point-of-sale interaction, whether it be food service, retail, or hospitality — in other words, mobile POS.

A series of options can be factory-integrated into the FZ-R1.  Customers can order a 5 megapixel camera or a 1D/2D barcode reader (they use the same real estate), add a 4G LTE mobile broadband modem, opt for a bridge battery for hot swap, include an extra large battery for 14-hour continuous operation, go for any of a set of hand strap and carrying accessories, and incorporate reliable voice-over-IP (VoIP) and unified communication capabilities (e.g., chat, messaging, email, voicemail).

The FZ-R1 can operate in mobile or countertop mode (with a cradle-stand).

Of course, a vertical solution wouldn’t be complete without a software development kit, technical and operating support, and partnerships, which Panasonic has either established or is in the process of putting together.  Development remains to be done on the back-end ecosystem, some channel decisions are yet to be made, and specific applications within retail still need to be finalized.

The FZ-R1 starts at $1,799, which is a bit pricey when compared to an iPad, but the product’s industrial-grade features will likely support such price points.  The base unit weighs 1.4lbs, and thickness runs from 1” (at the bottom) to 1.5” (at the top).

The company says it will be ready to talk about specific customer wins in late spring or early summer.  But the types of customers that Panasonic is courting include food-service companies like TGI Friday’s and Appleby’s, which have 500 stores or more, and the top 100 retailers, companies like Target and Wal-Mart, which have a minimum of 2,000 stores.

Another promising area appears to be furniture, sporting goods, and appliance stores, places where customers buy a product but don’t leave with it.  A specific example is Home Depot ’s lawn and garden center, where someone might buy a tractor.

If the FZ-R1 and its companions in the Panasonic lineup are successful, they will be able to participate in the growing market for mobile POS experiences, where consumers can order online or in the store, inventory is visible to customer and merchant alike, detailed transactional information drives insightful analytics for the merchant, promotions can be tailored in the field to individual profiles as they are discovered, and secure transactions are authorized instantly.

Twitter: RogerKay