Microsoft Sees Tablet PC as Future of the Notebook Computer - 20 Nov 2003

   Despite slow sales for the first generation of Tablet PCs (Microsoft says the hardware market has sold just 500,000 of the devices since November 2002), the company is upbeat about the future of what's perhaps its most innovative product. And Microsoft has a right to be excited: Thanks to an improved mobile platform, daring new designs from hardware makers, and a revamped version of the OS that drives Tablet PCs, enterprise customers who avoided the first generation are finally starting to take notice. In meetings with Microsoft and several of its Tablet PC-making hardware partners at the COMDEX 2003 trade show this week in Las Vegas, Nevada, I evaluated the second-generation Tablet PC, and the outlook is strong.
   First, second-generation devices are based on Intel's powerful and mobile-friendly Centrino platform, which features the Pentium-M microprocessor and about twice as much battery life as the first-generation machines, which were saddled with the lowly Pentium III-M or--worse--Transmeta's anemic Crusoe chip. For customers, this change means that new Tablet PCs will achieve both better performance and battery life, whereas most original designs typically achieve one at the expense of the other.
   Second, the new Tablet PCs are benefiting from a year of customer experience, and hardware makers have responded with innovative new designs, most of which are based on the convertible notebook form factor instead of the slate designs that dominated the first generation. Microsoft sees the convertible notebook Tablet PC as the future of notebook computers, and the OEMs I spoke with at COMDEX agree. Gateway is even offering a Tablet PC version of its mainstream notebook line that costs just $100 more than the typical notebook version; at those prices, the Tablet PC is no longer an expensive proposition but an economical value-added product. And in the coming months, you'll be able to buy a variety of hardware devices, including those with screens that range from 7" to 15", satisfying virtually any need.
   Third, early next year, Microsoft will ship a minor update to the Tablet PC OS, dubbed Windows XP Tablet PC Edition 2004. The company showed me the new features of this OS version, including an improved Input Panel that makes it easier to input text into forms by using Digital Ink and the Tablet PC's stylus. In a bold move, Microsoft will offer this OS update for free to all Tablet PC customers, and I'll review it soon on the SuperSite for Windows, so stay tuned for more information. 
   Fourth, the Tablet PC platform is finally experiencing a groundswell of software support, led by Microsoft Office 2003, which features integrated Digital Ink capabilities. In the Tablet PC's first generation, companies with special requirements created in-house most of the software titles developed for the platform. But as the Tablet PC matures and Microsoft makes it easier for developers to automatically add Digital Ink features to applications, more and more mainstream applications are coming on board. By the time Longhorn ships in late 2005, the company tells me, Digital Ink capabilities will be a core feature of the base OS.

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