Thursday, May 13, 2010

BCG studies suggests e-readers and tablets to become 'wildly popular'; points to price sensitivity

A study by BCG, a management consulting firm, was released yesterday that suggests mobile media devices like Apple's iPad stand a good chance of acceptance in the marketplace -- with half of those surveyed who were familiar with the products stating they plan on purchasing one.

"The survey suggests that e-readers and tablets are not a niche product for early adopters but could become the MP3 players of this decade. Grandmothers will soon be carrying them around," said John Rose, the global leader of BCG's Media practice in a release.
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The study, though, contains some contradictory findings. For instance, BCG claims that consumers it surveyed expressed the desire to do more with their devices than simply reading. According to BCG's findings "66 percent of respondents would prefer to buy a multipurpose device, whereas only 24 percent prefer a single-function device, such as the Kindle."

The survey also states, however, that consumers are price sensitive and say they are only willing to spend up to $200 for such a device. But should this really be a surprise? Apple's pricing is predictably on the high end of expectations, with the company skimming off the high-quality, high-profit segments of the market to its financial gain. Eventually, it is assumed, lower priced tablets will soon appear in the market and scoop up the buyers in the same way netbooks and lowly priced laptops consistently out sell Apple's Mac offerings.

The study also suggests that consumers would prefer more open systems. "The survey suggests that Apple's strategy of offering a wide degree of functionality makes sense," says Dominic Field, U.S. leader of BCG's Media practice. "But the results also call into question Apple's preference for a closed system."

I wonder, though, how this question was phrased as it would be difficult to ask a question that would generate the response "yeah, I want to be locked into a propriety system!"

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