Entelligence: Lessons from the CrunchPad
By Michael Gartenberg 
posted December 10th 2009 6:25PM
posted December 10th 2009 6:25PM
Entelligence is a column by technology strategist and author Michael Gartenberg, a man whose desire for a delicious cup of coffee and a quality New York bagel is dwarfed only by his passion for tech. In these articles, he'll explore where our industry is and where it's going -- on both micro and macro levels -- with the unique wit and insight only he can provide.
Last weekend, Nilay Patel did a great overview of the murky legal issues surrounding the mysterious CrunchPad -- now coming to market direct from developer Fusion Garage as the $499 Joojoo. While I won't get into the swirling controversy, I think there's a few important lessons to be learned from this great gadget debacle.
First, smart vendors under-promise and over-deliver. The hype and buzz around the CrunchPad were off the charts from day one. Everything from the delivery schedule to the initial price points were unrealistic, made moreso by continued promises to publicly show the prototype and targeted price points that kept rising with each announcement. Keep it low-key and simple -- then surprise and delight your customers with early ship dates and lower than expected prices. Too much promise with no delivery is the classic recipe for having a product get tagged vaporware. Always good to remember, "Whom gods destroy, they first make humble."
Second lesson: delivering consumer electronics products to market is hard. Sure, folks like Chris Anderson talk about how atoms are the new bits, but it's not that simple. While a plethora of ODMs are out there waiting to build devices for clients, simply having an idea for some gadget and hoping to farm it out to a manufacturer in Asia is a lot more complicated than it seems. Can it be done? Sure -- just ask Peek CEO Amol Sarva. But to make it work, you have to know something about the CE business, costs of materials and goods, and a real knowledge of the retail channel. Some of the claims about large CE retailers willing to carry the CrunchPad for "zero margin" or that one could include a 12-inch capacitive screens for a device that would cost $199 simply made no sense to anyone who understands the industry, and while the Joojoo needs to sell for $499 just to recoup the cost of materials, it's unlikely to find many buyers at that price point.
Third lesson: there's a fine line between products that can truly stand alone and products that should be subsumed into fuller-featured devices or services. No matter the legal issues or the hype, the CrunchPad / Joojoo concept itself is a bad idea. A device that does nothing but run a web browser with no specific or tailored services offerings behind it is a bad idea. Even Google Chrome OS offers more than that. Did no one stop to think that any generic netbook could offer the same
experience as well as a superset of functionality for less cost? Browsing is one of the things netbooks are best at doing -- and I can run my browser of choice.
Fourth lesson: gadgets designed for the needs of a niche audience are rarely successful. Even if you think the concept of a tablet device that can only run a web browser is a good idea, you might want to check if there's really a mass market for such a device. Niche devices have never achieved great market success, and I think it's just a matter of time before JooJoo gets positioned as a vertical market solution. Vertical markets are where mass market products that failed go to die.
I could go on, but there's no need. Personally, I'd have liked to have seen the CrunchPad be a success as it was originally conceived -- as something to meet a specific need with a breakthrough price point. There's hardly any chance of success here at $499.
Robert Browning once said " A man's reach should exceed his grasp, or what's a Heaven for?" Perhaps that's the most important lesson of the CrunchPad / Joojoo saga. Call me a gadget romantic, but I like the idea of someone with no background in consumer electronics coming out of nowhere with the "next big thing." Sadly, the CrunchPad didn't look like that from day one, and the Joojoo looks even less likely to succeed now. Even though I said the CrunchPad would never come to market the way it was originally promised, I admire effort even in the face of the harsh reality that the Joojoo is likely to face in the market. Unless there's some pretty strong pre-order action, I'm even skeptical that this product will ever even ship, at least in its current form and at its current price.
Michael Gartenberg is vice president of strategy and analysis at Interpret, LLC. His weblog can be found at gartenblog.net. Contact him at gartenberg AT gmail DOT com. Views expressed here are his own.
First, smart vendors under-promise and over-deliver. The hype and buzz around the CrunchPad were off the charts from day one. Everything from the delivery schedule to the initial price points were unrealistic, made moreso by continued promises to publicly show the prototype and targeted price points that kept rising with each announcement. Keep it low-key and simple -- then surprise and delight your customers with early ship dates and lower than expected prices. Too much promise with no delivery is the classic recipe for having a product get tagged vaporware. Always good to remember, "Whom gods destroy, they first make humble."
Second lesson: delivering consumer electronics products to market is hard. Sure, folks like Chris Anderson talk about how atoms are the new bits, but it's not that simple. While a plethora of ODMs are out there waiting to build devices for clients, simply having an idea for some gadget and hoping to farm it out to a manufacturer in Asia is a lot more complicated than it seems. Can it be done? Sure -- just ask Peek CEO Amol Sarva. But to make it work, you have to know something about the CE business, costs of materials and goods, and a real knowledge of the retail channel. Some of the claims about large CE retailers willing to carry the CrunchPad for "zero margin" or that one could include a 12-inch capacitive screens for a device that would cost $199 simply made no sense to anyone who understands the industry, and while the Joojoo needs to sell for $499 just to recoup the cost of materials, it's unlikely to find many buyers at that price point.
Third lesson: there's a fine line between products that can truly stand alone and products that should be subsumed into fuller-featured devices or services. No matter the legal issues or the hype, the CrunchPad / Joojoo concept itself is a bad idea. A device that does nothing but run a web browser with no specific or tailored services offerings behind it is a bad idea. Even Google Chrome OS offers more than that. Did no one stop to think that any generic netbook could offer the same
Call me a gadget romantic, but I like the idea of someone with no background in consumer electronics coming out of nowhere with the "next big thing." |
Fourth lesson: gadgets designed for the needs of a niche audience are rarely successful. Even if you think the concept of a tablet device that can only run a web browser is a good idea, you might want to check if there's really a mass market for such a device. Niche devices have never achieved great market success, and I think it's just a matter of time before JooJoo gets positioned as a vertical market solution. Vertical markets are where mass market products that failed go to die.
I could go on, but there's no need. Personally, I'd have liked to have seen the CrunchPad be a success as it was originally conceived -- as something to meet a specific need with a breakthrough price point. There's hardly any chance of success here at $499.
Robert Browning once said " A man's reach should exceed his grasp, or what's a Heaven for?" Perhaps that's the most important lesson of the CrunchPad / Joojoo saga. Call me a gadget romantic, but I like the idea of someone with no background in consumer electronics coming out of nowhere with the "next big thing." Sadly, the CrunchPad didn't look like that from day one, and the Joojoo looks even less likely to succeed now. Even though I said the CrunchPad would never come to market the way it was originally promised, I admire effort even in the face of the harsh reality that the Joojoo is likely to face in the market. Unless there's some pretty strong pre-order action, I'm even skeptical that this product will ever even ship, at least in its current form and at its current price.
Michael Gartenberg is vice president of strategy and analysis at Interpret, LLC. His weblog can be found at gartenblog.net. Contact him at gartenberg AT gmail DOT com. Views expressed here are his own.
Let me just get this out of the way.
Someone will eventually mention the so called Apple Tablet in the comments. I'm just here to express my disgust for benchmarking vaporware with even further in the future vaporware.
@Johanu: Apple Tablet.
@aubreyq the so called Apple Tablet
....HA!
You know I was gonna mention how Apple should read this article and now you made me feel like the idiot I am Johanu^^. Thanks buddy...
there is no apple tablet, only zuel
@kmmxracer
Why would Apple need to read this article? Not one word of the hype about an Apple tablet came from Apple. NOT ONE WORD. As far as Apple is concerned, they haven't once mentioned the word tablet, except when Steve Jobs mentioned that he didn't think tablets were a good idea. And that statement was made YEARS AGO.
All this Apple tablet hype comes from websites like this and from tech enthusiasts who believe (and no doubt with good cause) that IF Apple made a tablet, they would make it right.
@politicalslug: The fact that Steve Jobs mentioned tablets were not a good idea is official confirmation that he thinks they are, as long as it's his vision of a tablet.
I agree with pretty much every word here, except for one detail - that niche products never succeed. The iPod was a niche product. At launch, it offered fewer features than competitors (no FM radio, for example), at a much higher price-point. Even when they went mass-market (dropped FireWire, introduced Windows compatibility), it was still a very expensive, single-purpose device.
@Mike Cerm
That's a good point. I hate to bring up Apple again but they have a power over their users that can get niche products into the mainstream.
Imagine for a second that the JooJoo was the fabled Apple tablet and Apple had just announced it EXACTLY as it is now. How many millions of drooling Apple fans would be camping in line to get one? I wonder if Michael's article itself would have a different tone of "Jobs is about to hit another one out of the park."
Let's face it, Apple can crap in a box and there would still be some people who buy it.
@Kerensky97 That's not entirely true. In Apple's history, they've only really had two mainstream products: iPod and iPhone. Don't get me wrong, Apple has been able to reap the iPod halo-effect and move a decent number of laptops in the last few years, but you still can't call Macs mainstream.
I also think the jury is out on whether the Apple Tablet will go anywhere. Normal people don't have any use for a $1000 tablet (if they did, the JooJoo wouldn't seem so ridiculous at $500). Even among the Apple-faithful, how many really will drop $1000 for a device wedged so awkwardly between the iPhone and MacBook that they already have?
@Mike Cerm
when the iPod was first introduced it was smaller than anything before it, at that storage size (apple had an exclusive on those tiny Hitachi drives) and it was the first time software/hardware had been paired (iTunes) for such a high level of seamless integration. Even the power of Firewire (super fast syncing, power recharging) brought amazing features to the iPod. And, of course, the impeccable design.
Saying that it had fewer features is, not telling the whole story. It did amazing things. The fact that it was only on the Mac was because Jobs wanted it to attract people to the Mac. When the iPod because a profit maker in its own right, there was less incentive to 'bring people to the Mac'.. iTunes for WIndows came out, and Voila, the iPod is its own business.
First of all, saying niche products never succeed is idiotic: do you have any idea how much money Apple makes on the Mac desktops and laptops? Their success proves the OPPOSITE: you can be successful at any marketshare level, as long as you make great products.
Saying that Apple only ever had two successful products is somewhat insane, considering the iPod not just one product, but a family of products, moreover, has spawn an entire industry of accessories, and, oh yea, the iTunes Music Store and App Store bring in billions every year.
So keep telling yourself that Apple only has two mass market successful products, as long as within those 'two products' you include tons of hardware devices, accessories, and tons of online services, which all bring in lots and lots of money.
@Mike Cerm: Well, if one considers software as a product, you could add iTunes to the list of Apple mainstream products. In fact, the iPod would still be niche, or would have been niche for a longer time, if it wasn't for iTunes.
@Wesscoast I was pretty careful to use the term "mainstream" rather than "successful". That's the type of success that Michael was talking about in this article. I understand that Apple makes a lot of money from its computer hardware and from it's software businesses. However, Mac hardware and software has not been successful in acquiring significant marketshare, and the only Apple products that have ever been broadly adopted are, as I said, iPod and iPhone.
You can make a case for iTunes, but in my opinion, iTunes was only successful because of the iPod. There weren't millions of Windows users installing iTunes, loving it, and then running out looking for compatible MP3 players, and bringing home an iPod as a result. They were buying iPods, and were made to use iTunes. To argue the opposite, you'd have to find a meaningful percentage of people who use iTunes and DON'T own an iPod. You won't.
But yes, iTunes is, in a manner of speaking, a mainstream product. However, the iTunes Music Store still isn't. I haven't heard specific numbers in a while, but the vast majority of songs in the libraries of iTunes users were not purchased through iTunes. I'd say a hundred to one would be a decent estimate, but even that seems pretty charitable.
Likewise, the App Store may seem like a huge success, and it kind of is. However, the average iPhone owner (which is still a small percentage of the overall cell phone market) only downloads about 10 of the 100,000 apps in the store. Of those, most are free, and the percentage that gets used for longer than 30 days after the initial download is pretty dismal.
Don't get me wrong - Apple makes very good products, knows how to fill a niche, and is incredibly profitable. However, they generally avoid the mainstream on purpose. They don't even make laptops or desktops for less than $1000. (No, the Mini doesn't count. Talk about a niche product!) If Apple does make a $1000 tablet, I'm sure it would be profitable for Apple, but it's not going to be the next iPod.
@Mike Cerm Youre right, mostly, but the iTunes store, at least as a music store, is the biggest music store in the US. Bigger then amazon, best buy, or walmart. So I'd say it's not only successful but mainstream.
@iCello Point taken. iTunes does represent 25% of music sales in the US. However, I think that if you factor in all the ways that people actually acquire music (radio, file-sharing, and streaming), iTunes seems a lot more niche. Music sales just doesn't take into account how most people get most of their music. But yes, iTunes is a pretty significant music retailer, if you can consider any music retailer significant.
@Mike Cerm Yes, but the iPod had an immediate viable value proposition - 1000 songs in your pocket. The JooJoo has no killer app. If it was a digital artists pad with a stylus, it would sell like hot cakes to creatives everywhere. But the screen is of the wrong type so they cannot take that path.
@Mike Cerm: I don't think iPod is a good example of 'niche'.
mp3 was anything but a niche format. Before the iPod the portable player market was niche, but growing. Apple blew the doors off the hinges with it's marketing know how.
If Apple never launched an iPod, I'm sure that hard drive and flash memory based mp3 players would have penetrated through to the average person, but at a slower pace, and with a less one-sided outcome - or if someone else capitalized on it (say Sony leveraging the Walkman brand better) a different one-sided outcome.
In a lot of ways mp3 players was Sony's game to lose, and they did so spectacularly... ATRAC and Memory Stick anyone? ;)
Fifth Lesson: Michael Arrington is a douche monkey.
@NikAmi
It take a special kind of asshole to talk as much crap as Michael Arrington, here on planet Earth we call them "lawyers"
The original concept made sense, a $199 tablet device that ran only a browser. And the concept still makes sense, we may see a Chrome OS tablet or Apple tablet sooner or later.
The problem was execution and hardware choices. Using an Atom and netbook-like internals means that the device will cost at the bare minimum as much as a Netbook or even more (ultimately $500).
In the future, as bigger players get involved, we will see the internet tablet concept come to fruition; much like how the OLPC concept evolved into the modern EeePC and netbooks.
Maybe with cheaper eneragy-efficient ARM chips, Chrome OS, Google, or Apple involvement. We may see a $199 internet tablet yet.
@Temple
From touch based phones, to netbooks, to tablets.
I say we skip the third step and move straight to hologram based devices.
@Temple
With ARM processors, and Chrome OS, yes, it is possible we may get to the $199 price point at some point in the future. But Apple involvement, you say? There is no way Apple would come out with a tablet anywhere near the $199 price point,...not even close.
@Special Agent Steve
Amen Brotha!
@bluespirit
You have to be more specific here. Apple is most probably coming out with a multi-functional large multi-touch handheld device of some kind. And because it's going to be multi-functional of course they will charge more than $200 bucks.
But a $200 buck web only tablet is I believe still do-able. Mike screwed up the execution is all.
Hey Bagel Boy... it's actually:
"Whom Gods destroy, they first make mad"
As in, insane. If you're going to quote and not paraphrase get it right. That buzz you hear isn't the caffeine in your coffee but Euripides spinning in his grave.
Of course there's plenty of madness to go around in this whole sorry tale. And a bit of anger too I suspect.
@Samurai Jack
OK, I'll take half of your salted bagel for misattributing this quote to Euripides. I was wrong, as no one knows who to whom to attribute this ancient bit of wisdom. That's what I get for going from memory and not looking it up. . .
@Samurai Jack After listening to the gdgt podcast, engadget podcast and now reading this I can firmly say that I'd like to never hear or read that phrase again. Also Michael Gartenberg was pretty lame on those podcast imho.
@purfikt I agree. It should never be uttered unless you're referencing "Star Trek".
"That buzz you hear isn't the caffeine in your coffee but Euripides spinning in his grave."
Euripides or not that's the best line I've read all day.
@purfikt You thought he was lame? I rather liked hearing him on the podcast as he had well thought out ideas and stayed on topic much more than any other guy on the podcast. I didn't hear a single "great segue" out of him. :)
It can still be salvaged by the addition of N wifi, good multiformat video streaming capabilities, an HDMI plug and the possibility of adding an external hard drive.
let me put the OS of my choosing on this bad boy and you can take my money. nowadays even alarm clocks want to have a proprietary OS's. stop locking down this hardware , do yourself a favor CEO of ugly and let gadget nerds do some advertising for you. im sure if you saw someone taking notes on this thing using ubuntu youd stop to see what it is.
@indiana I suspect this thing will not be locked down, I am certain that it will be not-too-difficult to put on your OS of choice. Bundling it with windows out of the box wouldn't work probably because it would make it over $500, I am certain FG would be trying to make this a ChromeOS device if they knew then what they know now.
@indiana
the reason it has its own system is because its a totally new UI.
if you think every device should have the same OS, I suggest you go work at Microsoft. Their pathetic Windows Mobile team has been pushing this idea uphill for about 15 years. Only now they're starting to copy the iPhone and move towards a very un-Windows-y UI. Does that upset you?
@Wesscoast
totally new UI ? you must have seen a video that i did not.
why the Microsoft hate. im open to any os. no real preference although with 1 gig android or linux would be nice. but now that you mention that capacitive screen sure would be nice on the multi touch win7 features or say that DVXA hardware acceleration for Mkvs.
ps if you got a spot for me at microsoft , id take it. i need a job. thanks.
> A device that does nothing but run a web browser with no specific or
> tailored services offerings behind it is a bad idea.
Pretty bold statement from a blogger - who are you to say? What do you have to back that up? Have you done some consumer studies? Prototyping?
@rterek Our man Gartenberg is one of the most respected analysts in the industry, homey.
@Nilay Patel I wish I could upvote you guys.
@Nilay Patel
Yeah yeah, and he likes bagels. . .
@Nilay Patel That doesn't make him necessarily right however. If he'd qualified it and said it was a bad idea at this point of time, then his assertion would be more believable. Its quite possible with the way web apps are going that, one day, a tablet that only runs a browser could actually be a good idea.
This is a very poor analysis, and most of these lessons aren't lessons at all. They seem to be mostly just a translation of your personal dislike of the Crunchpad.
@bobfet1
Au contraire, I think the hardware looks great, but I have strong reservations myself on the point of spending $500 for a glorified web surfing tablet.
Who spends $500 on a one-trick pony?
@bobfet1 Yes netbooks are cheaper than this, but there is one thing I hated about the netbook I had, it was the screen real estate when browsing the web. I just got done watching a video of the joojoo on youtube, and the amount of content you could see in portrait mode was really great.
This thing offers a lot that netbooks dont. There is an inherent appeal to a tablet design. The failure of them to catch on is a failure of hardware and software, not of concept. The main hardware failure of the past has been the lack of capacitive multitouch which is the only thing which gives you the input capability and, more importantly, responsiveness you need for such a device.
The second has been software, interface design is the most esoteric process in computer science and just as it took time to develop the concepts of windows and drop down menus and radio buttons, its taken time to get the interface right for a tablet.
The Joojoo (and its a fine name, no dumber sounding than "iPod" or "Boxee" or "Macintosh" or "Google", the point is you remember it), has some nice looking hardware. Its capable of doing anything you want to do software-wise. The software (while I admire its moden design) looks like beta and lacks what we expect.
But, as the iPhone has taught us, software problems are not such a big deal when there is a solid hardware/design foundation. When the iPhone first came out it cost $500, ran no apps, was SEVERELY deficient in even basic phone features, and people practically killed each other to get it. I know, its Apple, but over the course of a a few years its become an amazing product. Even a non-fanboy would want one.
I actually think it will probably be a very niche market when it comes out, but once the hacks come along (new OSes, expanded memory) and FG responds to those hacks by making them features (like Apple did with the App Store, which was up until then, a hack) the device will come into its own.
So far this OS looks essentially identical to ChromeOS in capability, except it doesn't come with links to Google products as default.
I would love to have one, it would be a great document reader (since I can read pdf's in print-size). I think this is the most undersold part of the device.
I just hope you people don't inseminate your trousers when the iTablet comes out (costing $1000) and you proclaim it the best thing ever.
One thing that worried me with the CrunchPad is what would happen once the device would be in the customer's hands? What about customer service, hardware failures, and so forth? It seems like the whole process was very much "discover as you go", but I could be wrong. Not having the entire process well thought through at launch time would be a recipe for disaster. Oh well, good luck Joojoo (a name which, BTW, would be spelt "Joujou" in French, which means "toy", as in "low quality toy").
@brillow
i am pretty sure that conceptually the idea of a tablet is sound and even very attractive. However i believe that reality is another matter and it goes beyong things like multi touch.
the issue is that it simply does not fill any role or need except in the most specific of roles (i.e. Medical). Noone has yet explained how the average consumer will use the tablet. It is also very unwieldly. There is just no way to make it work comfortably for any extended period of time. The mobile phones can fulfill the role much better and doesnt suffer from those issues.
I just cant see it working out. It is a pretty dream but not a practical or even useful device unless we go out of our way to convince ourselves otherwise.
wow, engadget should really get out of the "analysis" business.
Does anyone actually care about the CrunchPad?
Arrington is a fool.
The Joo Joo will never ship, and if it does, the company will go belly up within a year. Any number of major manufacturers can build a tablet & kick the crap out of what I saw demo'd.
I would pay money to never see the dude from Fusion Garage's face ever again, damn he's freaky...
I owned a Dell tablet for 2 months, it was one of my few recent purchases I wanted to actually destroy rather than resell on eBay.
Jobs will clean up with the iFap or whatever the hell they call it.
The joojoo Crunchpad Itablet Ipad what ever have appealing points. But I think it should do more than just offering a limited browser, to attract the mass market. They (joojoo e.g.) are all first movers.... which mostly results in failures. No one has established right now a dominant design....features....screen size...user experience.....
Btw ......the tablet is in my eyes a totally new market which cannot be compared with netbooks.