Are You Ready for the Tablet Rally?

More of us will work from the road in 2012. According to a new survey from the business-to-business daily deals site RapidBuyr, 49% of small business owners plan to buy a tablet in the next six to 12 months. Another 44% said they planned to purchase a mobile phone.

Talk about great news for Apple (Nasdaq: AAPL  ) and Google (Nasdaq: GOOG  ) . The twin towers of tech are already vying for worldwide dominance of the smartphone market. They'll mix it up more as the fight for tablet market share heats up this year.

Other than Amazon.com's (Nasdaq: AMZN  ) Kindle Fire, alternatives haven't shown much oomph. For example, Research In Motion's (Nasdaq: RIMM  ) PlayBook has gained market share in its home country of Canada after slashing prices. This week the company added in-device email more than a year after rivals included similar functionality.

Who benefits most from rising tablet demand? My money is on Apple for three reasons:

  • Ownership. Whereas Google licenses Android, Apple owns everything cooked into the iPad. More sales will always result in more revenue and profit. On the other hand, big demand for the Kindle Fire -- 6 million units sold in the holiday quarter, according to reports -- might mean nothing for the Big G. Only Amazon profits directly from those sales.
  • Upgrade cycle. Say what you will about Apple's selling 15.4 million iPad 2s in Q4; it's been almost a year since the iPad 2 came to market. Rumors that a high-resolution iPad 3 will reach the market next month have fueled an ongoing rally in the Mac maker's shares, no doubt attributable to Apple's long history of enjoying success when taking its time with product line refreshes.
  • Android limits. Finally, there's little to love about Android tablets as media alternatives. Yes, my Galaxy Tab runs Netflix, and that's great. But it also can't download episodes of newer TV shows from iTunes or Amazon Instant Video. Nor can I buy and play movies other than what's on YouTube. As a TV replacement, it's a two-horse race between the Fire and the iPad.

Of course, Apple and Google are just two of several companies benefiting from the rise of mobile computing. The Motley Fool recently identified a hidden winner in a report titled "The Next Trillion-Dollar Revolution." The research is free, but only for a limited time. Get your copy now.

Fool contributor Tim Beyers is a member of the Motley Fool Rule Breakers stock-picking team. He owned shares of Apple and Google at the time of publication. Check out Tim's Web home, portfolio holdings, and Foolish writings, or connect with him on Google+ or Twitter, where he goes by @milehighfool. You can also get his insights delivered directly to your RSS reader.

The Motley Fool owns shares of Google, Apple, and Amazon.com. Motley Fool newsletter services have recommended buying shares of Amazon.com, Apple, and Google and creating a bull call spread position in Apple. Try any of our Foolish newsletter services free for 30 days. We Fools don't all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.


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