Microsoft's efforts to push the concept of a "2-in-1" device, a tablet that does double duty as a notebook, will continue to struggle, an analyst said Tuesday, citing a forecast that pegs 2016 as the first year when more than 20 million of the devices will ship from factories.
"It's safe to say that it's going slower than [Microsoft and Intel] would like," said Tom Mainelli of IDC. "But they're both in this for the long haul."
In a report Mainelli authored, IDC forecast a slow increase in unit shipments of 2-in-1s, which the research firm defined as "devices that offer an optional or an included first-party keyboard that physically connects to the tablet to create a clamshell form factor similar to a notebook."
Microsoft and Intel have both aggressively promoted hardware like that, Microsoft as a form well-suited for its hybrid Windows 8.1 operating system, Intel as a category founded on its latest generations of low-power x86 chips.
Redmond, Wash.-based Microsoft has been particularly insistent on 2-in-1s, whether designing and selling its own computing hardware for the first time -- the Surface -- or touting Windows 8 as a "no compromise" OS before its launch. Early on, Microsoft executives explicitly compared the price of the Surface Pro, the model powered by Windows 8.1 and so able to run legacy software, with a one-two combination of iPad tablet and MacBook Air notebook.
It's not that those efforts have gone for naught, but IDC projections showed a tough road ahead.
The researcher estimated 2013 shipments of 2-in-1s -- not just Microsoft's poster child Surface, but also OEM products like Asus' Transformer and Lenovo's Yoga -- at 6.2 million units. About a third of those were Surface shipments.
For 2014, IDC predicted 10.3 million 2-in-1s will ship, an impressive 66% growth rate that, if considered in isolation, disguises the low volume. IDC said shipments would climb to 31.2 million in 2018. The category isn't forecast to crack 20 million units until 2016.
By comparison, Apple sold 26 million iPads in the December 2013 quarter alone.
That's not surprising, as 2-in-1s, which IDC split out for the first time this month from tablets in general, account for a very small slice of the combined shipment volume. In 2013, for instance, 2-in-1s accounted for 3% of all tablets. The category's share is expected to slowly increase until it reaches about 8% in 2018.
A "long haul," as Mainelli put it.
But he sees 2-in-1s having a shot. "Everyone is going to realize that PCs aren't going away, tablets are not a fad, and all these devices will be part of the workplace," Mainelli said. "There will be a PC refresh. And rather than a clamshell, some of those will be replaced with 2-in-1s."
One advantage 2-in-1s have in commercial scenarios is that, at least for devices running Windows and Android, they can spawn multiple windows, which are crucial to the kind of business work most associate with PCs.
IDC has forecast a slow slog for 2-in-1 device volume over the next five years. (Data: IDC.)
"Fundamentally, when we work in Office, you have a Word document, and an Excel spreadsheet or Web browser open next to it," said Mainelli. "Windows and Android do have the ability to run multiple windows. At this point that leaves iOS as the only operating system that doesn't do that. I think that's going to be a stumbling block for iOS, both for IT buyers and consumers."
iOS, more specifically Apple's iPad tablet, accounts for the bulk of the commercial tablet market, in part because of companies' BYOD (bring-your-own-device) policies, but also because the iPad was first to market. Other device makers could promote their 2-in-1s as more suitable for Office-related office work, Mainelli said.
"IT buyers are going to look at 2-in-1s as between a notebook and tablet, just like consumers," Mainelli said. "There will definitely be opportunities. The questions are: Does Windows evolve to the point that IT is willing to buy it? Do Android and iOS evolve as well?"
Apple has not hinted that it will enter the 2-in-1 fray. In fact, its CEO, Tim Cook, has regularly bashed the idea as ludicrous. In 2012, around the time Microsoft launched the Surface, Cook called it "a fairly compromised and confusing product," and in the next breath, compared it to "a car that flies and floats."
Before that, Cook pledged, "We're not going to that party," referring again to the hybrid, 2-in-1 concept.
But Apple has retreated from passionately defended positions before, Mainelli noted today, ticking off smaller iPads and electronic books as examples.
While others have been bullish on Apple's chances of dominating the 2-in-1 category if it entered, perhaps with a larger-sized iPad, Mainelli was hesitant to join them. But he believes Apple could be a player.
"They really have a leadership position in tablets in the enterprise," Mainelli said. "If they would build on that, considering the enormous number of iOS custom apps built for business, it makes sense. I wouldn't expect them to market it to enterprises, but they'd end up there."
IDC didn't assume that Apple will put its formidable foot in the 2-in-1 door when the market research company came up with its 2014-2018 forecast. "If they do, our forecast would change. It would shift some tablet numbers to 2-in-1, I think. But Apple is famous for cannibalizing itself," Mainelli said.
Indeed. Cook has repeatedly stressed that when answering questions about the iPad's cannibalization impact on the company's notebooks, the MacBook Air and MacBook Pro. His take: It's always better to cannibalize ones own products rather than let competitors do it.
Gregg Keizer covers Microsoft, security issues, Apple, Web browsers and general technology breaking news for Computerworld. Follow Gregg on Twitter at @gkeizer, on Google+ or subscribe to Gregg's RSS feed. His email address is [email protected].
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