Apple May Suffer Some Indigestion

Source: E la Carte.

You can't spell Applebee's without Apple, but you can apparently run one without it. 

DineEquity's (NYSE: DIN  ) Applebee's will deploy 100,000 tablets to its eateries next year, but they won't be Apple's (NASDAQ: AAPL  ) handiwork. DineEquity CEO Julia Stewart, appearing on CNBC this week to discuss the move to install tablets at every table, was asked why her company went with E la Carte's Presto tablet instead of the iconic iPad.

"There was a lot of technology discussion about what was the absolute best way to interact," Stewart explained on Tuesday. "We felt that this technology -- which is called E la Carte Presto tablet -- created the best opportunity for us to interact with the customer, but also to have one at every single table."

There are two things in that meaty explanation for why the iPad fell short. The big one may naturally be price, hence the comment about going with a non-iPad solution so that DineEquity could afford to order 100,000 tablets without cutting a $50 million check. E la Carte's website promotes offering the Presto with no up-front costs. The other explanation involves sidestepping Apple's tightly controlled iOS infrastructure to build a more flexible, programmable environment.

This tablet was designed specifically for the restaurant industry. It's rugged and packs a 20-hour battery life. It also has some potent success data from the early adopter establishments. The tablet's site claims that customers wind up spending 10% more by being able to place orders on the device. The ability to order when they're ready -- not when the wait staff is ready -- and pay at the table also allows a restaurant to serve more diners. Tables turn, on average, seven minutes faster.  

There will be no bigger test for E la Carte's success than Applebee's. If customers are spending more and more tables are being turned it will show up in DineEquity's financials. Other chains would be crazy not to follow along, and it will be an obscure platform not bearing the Apple name leading the way.

It seemed last month as if Apple had a shot in the eatery automation movement. Reports had McDonald's (NYSE: MCD  ) testing iPads at two locations to see the value of offering new burgers with more customization features. McDonald's is rolling out new prep tables that will give customers more than two dozen ingredient choices, and technology will be a big factor in getting things right.  If the world's largest restaurant chain had gone iPad, wouldn't the rest of the industry follow? Well, it turns out that the tablets weren't being used to actually place orders and process transactions. They were just there to give patrons more time to build up their burgers before the order was entered by an actual employee.

Tablets in the hospitality industry will be huge in the coming years, especially as casual dining chains are struggling because folks don't like to wait to order and pay. This could still be a huge opportunity for Apple, but it better be more aggressive before the market gets gobbled up by everybody else.

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Read/Post Comments (8) | Recommend This Article (4)

Comments from our Foolish Readers

Help us keep this a respectfully Foolish area! This is a place for our readers to discuss, debate, and learn more about the Foolish investing topic you read about above. Help us keep it clean and safe. If you believe a comment is abusive or otherwise violates our Fool's Rules, please report it via the Report this Comment Report this Comment icon found on every comment.

  • Report this Comment On December 12, 2013, at 11:56 AM, larryw101 wrote:

    Another clown face Apple basher from Motley Fool who decides to write a negative story on Apple.

    He's never been right once with his predictions.

    Someone please tell me where Motley gets theses bozo authors at.

    Shame on Motley for such garbage journalism !

  • Report this Comment On December 12, 2013, at 12:18 PM, DrDick1954 wrote:

    Cheap trick - this article has almost nothing to do with Apple, but references and headline imply problems with Apple. Junk info as far as Apple is concerned.

  • Report this Comment On December 12, 2013, at 12:41 PM, DanManners wrote:

    what a bozo author this guy is... so one company is using another brand tablet and apple is over. unreal no more motley fool this rick guy is a joke.

  • Report this Comment On December 12, 2013, at 12:54 PM, darnold1956 wrote:

    So…if I take care of the order myself…then I don't need to tip? Looks like servers will lose out again…the company adds 10% to their bottom line, but I doubt that will translate to increases in base employee pay.

    The only problem I see with this…how easy will it be to customize my order? That's one advantage to being able to tell a waiter/waitress some change you'd like to your order than what is on the menu.

    Just another industry taking the human interaction out of the experience.

    And…who wants to order on a greasy, fingerprint-ridden screen anyway?

  • Report this Comment On December 12, 2013, at 3:52 PM, TXObjectivist75 wrote:

    You guys just love to shoehorn the word Apple into everything now. What rational person really expects a restaurant to buy 100 times more tech and processing power than they need to get the job done? I'd bet this doesn't even factor into Apple's business plan, unless they plan on selling cut rate iPad 2's. Motley Fool seems to be more interested in link bait than analysis most times now.

  • Report this Comment On December 12, 2013, at 3:56 PM, Mathman6577 wrote:

    Losing 100,000 out of 170 million sold to date = 0.06%. Hardly a big issue.

  • Report this Comment On December 14, 2013, at 10:06 AM, Mathman6577 wrote:

    Yes, Apple is dead: iPhone 5s is top seller at all major carriers, 5c is 3rd:

  • Report this Comment On December 17, 2013, at 11:18 AM, Mathman6577 wrote:

    68% of Americans will eventually own an iPhone:

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