A Few Theories on Design, Features and Price of an Apple Mini-Note
DisplaySearch has a few theories on the much-rumored Apple mini-note that we would like to share. Will they do it? Well, during Apple’s Q1 conference call in January 2009, in response to an analyst’s question about mini-notes, Apple COO Tim Cook said, “We’re watching that space. Right now from our point of view, the products in there are principally based on hardware that’s much less powerful than we think customers want, software technology that is not good, cramped keyboards, small displays, etc…. We don’t think that people are going to be pleased with those type of products,” he concluded, but he then hedged with this: “But we’ll see. We are watching the space. About 3% of the PC industry last year was in this netbook kind of category. So it’s a category we watch.”
Building upon Mr. Cook’s comments, we would add that Apple is unlikely to build such a device unless they can do so while also preserving their typical hardware profit margins. But assuming they have a device up their sleeve, we have a few theories about what it would look like and what it would do.
The Display
First, there is a big gap between the 3.5″ display in the iPhone and the 13.3″ displays in the MacBook and MacBook Air, both in terms of display size and price. Split the difference and you get a roughly 10″ display. Given the trends in Apple’s displays over the last few years, we would expect it to be bright (perhaps 300 cd/m²); have an LED backlight; be very thin, perhaps utilizing 0.20 mm or 0.25 mm glass (typical notebook displays use 0.50 mm glass); have very high color saturation, perhaps 75% NTSC or better; and have a wide viewing angle both horizontally and vertically. OLED? We don’t think so. It is no secret that Apple made a sizable investment in LG Display and that this new factory, when built, could be capable of OLEDs, but that is still a long way off. Further, OLEDs, at least in their current incarnation, tend to have higher power consumption and shorter lifetimes than TFT LCDs-not to mention significant price premiums.
Form Factor
What shape will the box take? Perhaps a slider or a slate/slab style? We doubt such a form factor would appeal to Apple’s design ethos. A slider has already been dismissed in the context of the iPhone as Apple has eliminated a physical keyboard in that device. In regards to a slate or slab style, UMPCs were not met with much enthusiasm when launched and there were numerous complaints about the lack of a keyboard and the size and weight of these devices.
The next two options are the traditional clamshell or notebook form factor and the convertible tablet PC form factor (where the upper case pivots and folds flat over the keyboard). Our thinking is that the convertible tablet form factor offers a lot more options in regards to what can be done with such a system. The App Store has been a huge success, and Apple has actively promoted the iPod Touch and iPhone as portable gaming platforms. A convertible tablet form factor provides the ability of the device to be used in “slate mode,” like a giant iPod Touch for gaming, while also providing the ability to use it in clamshell mode like a more traditional notebook PC.
Features
In any portable electronic device, power consumption is key. One piece of that equation is power storage, or the battery. Apple is currently using polymer cell Li-ion batteries. These are “shapeable” and have much better performance than conventional cylindrical Li-ion batteries. The other piece of that equation is power consumption. In April 2008, Apple acquired PA Semiconductor, a company that is noted for their ability to design very high performance and very low power consumption processors, and Steve Jobs was quoted as saying, “PA Semi is going to do system-on-chips for iPhones and iPods.” What other features are necessary? If it is to be a convertible tablet form factor with many of the same user interface features as the iPhone and iPod Touch, then a touch screen and accelerometers for gaming are essential.
Other essential hardware would be 802.11, 3G connectivity, and an integrated camera. Additionally, we would expect solid-state storage, potentially at 32 GB and 64 GB, permitting the user to store a lot of music, video, and text. The text might be in the form of e-books or e-zines or other media typically found in print. The device might also make an excellent e-reader, and with a color display, it could do more than just serve as a way to read novels or newspapers with the occasional grainy photograph. Instead, users could read newspapers, magazines, and other full color documents on the device, which of course would be available through the iTMS (iTunes Music Store).
On the software side, we would expect the device to run OS X, having more functionality than an iPhone, but less than a full-featured MacBook or MacBook Pro.
Carrier Network
Apple has done quite well with their partnership with AT&T here in the US, and with other carriers overseas. The details of the recent announcement that AT&T will sell iPhones with no contract are not yet clear. It is not known if these will be “unlocked” phones, able to be used on any carrier’s 3G network, or if they will only work on AT&T’s 3G network. Either way, our opinion is that Apple would want to appeal to as large a customer base as possible. In much the same way that they made iTunes, iPods and iPhones work with Windows-based machines, we would expect that this device would be available on multiple cellular networks. In the US, notebook PCs with integrated cellular connectivity are not popular, due in large part to customers desire to not be locked into one service provider. People tend to keep notebook PCs longer than cell phones, and an inability to switch carriers might inhibit demand for an Apple mini-note.
Price
Subsidized mini-notes (price-reduced when the buyer signs up for a cellular data plan) popped up in Europe not long after mini-notes’ popularity began to surge. AT&T test marketed a subsidized ($99) Acer Aspire One through Radio Shack in December 2008, and the carrier is also test marketing a subsidized Dell Inspiron Mini. Of course, Apple’s BOM (Bill Of Materials) would likely be a bit higher than the typical mini-note.
Therefore, it seems logical that Apple and its potential cellular partner(s) could offer the device either as a subsidized product, or without a subsidy and the requisite data plan. How much would such a device cost? The MacBook has a starting price of $999. The 8 GB iPhone costs $199 and the 16 GB version costs $299. The no-contract phones will sell for $599 and $699. So, what would our hypothetical un-subsidized Apple mini-note sell for? $699. Our math is simple, that price is half way between the $399 subsidized 16 GB iPhone and the $999 entry-level MacBook.
So, what do they call it?
DisplaySearch has been following the OLED industry since its inception and it is disappointing to see comments that don’t reflect the most recent advances made by a range of companies practicing the technology. In the blog about the Apple Netbook, you made three comments about OLED displays, “OLEDs, at least in their current incarnation, tend to have higher power consumption and shorter lifetimes than TFT LCDs-not to mention significant price premiums.” None of these statements reflect an accurate and timely view of the situation:
1. OLED lifetimes are 50,000 hours and growing. Apple recently advertised that their notebook had a battery that could last for 8 hours and could be charged 1,000 times. So they apparently expect the notebook to be used for 8,000 hours. The OLED display would last for more than 6 battery replacements, more than likely the life of the notebook.
2. OLED displays have been proven to be brighter than TFT LCDs at the same luminance as demonstrated by both Samsung Mobile Displays and Nokia. Moreover, Nokia’s usage model for mobile products showed that OLEDs used less power than TFT LCDs on panels with the same size and resolution.
3. OLED displays are more expensive now than TFT LCDs, but when has that ever stopped Apple from employing a technology that is highly differentiating.
DisplaySearch is batting 0 for 3 on these items. Where they may have it right is that LG Display, which has a 2nd Gen OLED Fab is not ready to supply high volumes of 10” displays
Barry, nothing that you wrote actually disproves the three points with which you are taking issue:
1. Lifetime – while OLED lifetimes may be long enough for a notebook lifetime, the blog post was actually pointing to the fact is that both CCFL and LED backlit TFT LCDs have longer lifetimes than OLEDs.
2. Power consumption – the caveat in your assertion is the “usage model for mobile products” which typically involves changing the user interface from mostly white to mostly black, which favors OLED in terms of power consumption. This type of control is simply not available in a notebook device using standard browser and office productivity programs which use mostly white interfaces.
3. Price – you actually agreed with our assertion that OLEDs have a price premium; you just think that Apple will accept such a price premium.
Paul
I realize that LCD’s are the dominant technology, but why would a supposedly neutral research organization analyze technology with an LCD bias? This bias is what I am trying to combat. Regarding your three points:
1) You should be taking the user’s perspective. If the three sigma lifetime is less than what an OLED display provides, why is it meaningful? If OLEDs had a 1M hour lifetime, would it be meaningful as an advantage over LCDs for a mobile phone or notebook? Obviously no! Meanwhile Novaled has demonstarted lifetimes approaching 1M hours.
2) Your assumptions are wrong. The Nokia usage models show both black and white backgrounds and while the black background improves the power consumption for OLEDs, the OLED displays still use less power than LCDs with a white background. Just another case of LCD bias.
3) The point I made is that Apple has traditionally opted for differentiation. The issue is what will buyers pay for. It is not a case of pure price, a mistake that many followers in the industry think is most relevant. Look at what recently happened to Dell; they built an undifferentiated smart phone and it was apparently rejected by the market (carriers). I do not quarrel with the fact that OLED displays are more expensive than TFT LCDs, just the conclusions drawn about the difference.
I recall when DisplaySearch started, one of our competitors kept harping on the poor yields and high costs of TFT-LCDs as an indication of their inability to compete with CRTs. We were able to gain market share because the world changes and market researchers need to be ahead of the curve and not behind it.
I appreciate the opportunity to get a platform to present my points.
Barry
While I dont think that LG will be supplying 10″ OLED’s to Apple anytime soon, it is worth noting that the latest news out of Korea is that LG is purchasing equipment for a 4G OLED fab. No word on either the timing or the ultimate capacity for this fab, but it does increase the possibility of OLED’s working into Apple’s products in the short to medium term. My best bet would be that they would end up in either the Touch or iPhone well before we saw them in a netbook.