By Chris Chang, posted Jun 13, 2011 at 6:21 PM, 585 views,

Dell to Launch 10-inch Tablet in China First, U.S. on Hold till Next Year

Why China? This becomes a question for Dell fanboys who have been waiting for Dell’s 10-inch Android tablet to launch in the States since the tablet first showed up in CES. According to a blog post written by Amit Midha, Dell’s president of China and South Asia, the company will first launch its Streak 10 Pro tablet in China later this summer, putting other markets like the U.S. and Europe on hold in order to give developers more time to create the necessary apps. And it looks like there are more reasons behind it.

Here’s the major concern, China has a vast market where many people are going online for the first time. And the company thinks that the next one billion people to come onto the Internet will be from emerging countries, with the majority from the so-called BRIC countries (Brazil, Russia, India, China). These countries present tremendous growth and opportunity to Dell as a company. And Midha mentioned Dell’s biggest advantage in China,

“In addition, we have a significant – and rapidly growing – retail presence in China, with more than 10,000 locations where customers can buy Dell products throughout the region.”

That’s true. Dell is currently number 2 in the Chinese PC market with roughly 10,000 stores that sell Dell products in the country and, by the end of the this year, there will be 2,000 service centers where customers can bring Dell products for technical support. And the good news is the company is seeing a significant increase in the number of small and medium-business users, who are adopting mobility products as part of their growth plans. In Q1 of 2011, the company’s revenue from China grew 22 percent. What’s more, Midha thinks that China is a big market for Dell in the future.

“China is the largest in the emerging market category and the second fastest-growing in the emerging market category. And China is also our second largest market right after the U.S. The China market in units may cross the U.S. in the next couple of years.”

And here’s the fact. The U.S. market is becoming more competitive, according to John Thode, a Dell vice president and manager of Dell’s mobility business. And Thode has more to say,

“The U.S. market simply doesn’t offer a viable 10-inch tablet strategy for Dell. This is not an either-or for us. This is a choice about where is the best place to take our story and avoids a bunch of the inhibitors and barriers to success that we’ve seen in the U.S. market.”

Yup, Thode is right. China could be a better market for Dell to sell its tablets, considering Apple already dominates so many other markets with its iPad device, especially the U.S. market. However, Apple’s iPad is also very popular in China, and there’s a very huge demand from scalpers and grey markets. Today, Apple has a 78 percent share of China’s tablet market, and the remaining 22 percent belongs to Samsung and other tablet producers such as Lenovo, Motorola, ZTE, Huawei and Malata. But none of them could do well in the tablet industry in China, here’s the main reason,

“Apple’s advantage is that they have the brand recognition. When people think about buying a tablet, they automatically think about the iPad.”

Yup, according to Sun Peilin, an analyst with Beijing-based research firm Analysys International, this is why Apple’s iPad has dominated the tablet market.

As for the tablet sales in China, it is growing. Tablet sales in the country are expected to reach 4.5 million units this year, an increase from 600,000 units last year, according to estimates from Analysys. If Dell is thinking to join in the tablet war in China, the company must take Lenovo and Apple into consideration.

Lenovo is well-known in China, and the company is currently the top PC seller in China. They have a 10-inch Android tablet too, the LePad, which starts from 3,499 yuan ($539). The company started selling its LePad tablet in the country in March, and over 1000 units were sold in the first week of launch. Looking at the popularity of the LePad in the country, the company plans on making its LePad available in 5,000 stores in 400 cities across China this month. Dell, got that?

As for Apple, the company has a total of four Apple stores in Beijing and Shanghai, but also has a Chinese Website from which orders can be made as well as from authorized resellers. One must know that the launch of the new iPad 2 in China was outrageous, drawing thousands of customers and scalpers to the Apple stores, and the iPad 2 went out of stock in just 4 hours on the first day of launch. This clearly shows how popular the iPad is in the country. Will these customers get interested in other tablets? Probably no.

Oh, there’s one more thing to take note, the shanzhai market. There are lots of inexpensive and unbranded tablets which sell for US$75 to $300 in mainland China, especially Shenzhen. Local media tablet vendors are producing numerous of tablets, to compete with Apple’s iPad with their low prices. However, these tablets would never success since all of them are powered with Android 2.2, and none of them features Android 3.0 Honeycomb. So, in order to be a better brand against these shanzhai tablets, Dell must offer their tablet with Android 3.0. And here’s an interesting statistic, in the first quarter of 2011, 41 percent of the 850,00 tablets sold in China ran Android, according to IDC. Nice.

Just in case this is the first time for you to hear about Dell’s 10-inch tablet, well, we’re talking about the Streak 10 Pro, as it’ll officially be known, comes with a Honeycomb-standard 1280 x 800 resolution screen, an edge-to-edge glass surface, two cameras (one of them reaching a 5 megapixel res), an SD card slot, a thickness of 12mm, and 1080p video playback capabilities courtesy of an unspecified NVIDIA Tegra dual-core processor. Sounds awesome, and let’s hope it will not be overpriced.

Source: Dell via PCWorld