A little-known Newport Beach company has introduced one of the cheapest tablets on the market as it aims to find a profitable niche in the fast-growing mobile-computer segment.
Idolian Mobile Inc. recently launched a 7-inch tablet for under $100. IdolPad Plus runs on the Android 4.0 operating system and is touted by the company as the lowest-priced Android tablet on the market.
“It’s very affordable and selling very well,” founder and Chief Executive Jay Kim said.
Kim declined to detail sales figures.
IdolPad Plus is ranked among the top 30 tablets selling on Amazon.com. It’s also available on sears.com, buy.com and through the company’s website.
The tablet features 512 Megabites of random access memory and 4 gigabites of storage. That’s plenty for surfing the Web, playing online games and running apps, according to Kim.
The device lacks Bluetooth and GPS capabilities and has a low-resolution camera.
Idolian, which was established in 2010, joins a crowded field of tablet makers, primarily based in Asia, targeting the lower-end of a growing tablet market that expected to see sales double in 2012 to nearly 119 million units, according to Stamford, Conn.-based market tracker Gartner Inc.
Perhaps the best-known low-cost device in the segment is the Aakash tablet that debuted earlier this year at the International Consumer Electronics Show. The Android-based tablet made by Canadian manufacturer Datawind Ltd. sells for less than $50 in India, thanks in part to government subsidies and has garnered worldwide attention since it was announced late last year.
Irvine-based Vizio Inc. introduced its 8-inch Vizio Tablet about a year ago. It sells for about $300.
Amazon’s 7-inch Kindle Fire and Barnes & Noble’s Nook Tablet each cost about $200.
Obstacles
Idolian has plenty of obstacles to overcome in competing against established players, said analyst Rhoda Alexander of Englewood, Colo.-based IHS Inc.
“What they have is a low price point,” Alexander said. “What they lack is an established name, reputable brand presence and a marketing arm.”
The company also needs to solidify regional ties and develop customer support in many languages and locations for viability, she said.
IdolPad Plus’ marketing has largely consisted of Google click ads and press releases.
Cupertino-based Apple Inc. is the market leader in the segment with iPad sales forecast to hit a record 20 million units in the June quarter.
Idolian is treading lightly into the industry as Jay shuts down his former business, a telecom company that offered prepaid phone cards to consumers at more than 300 retailers in the Missouri and Arkansas region. That business nose-dived in the recession and wasn’t able to rebound in a segment that has largely been lost to low-cost mobile phones.
“We had to evolve,” Kim said. “It’s a completely new business for us.”
Kim first entertained the idea to enter the tablet market two years ago after watching his three children fight for time on the iPad.
“I never got to use it,” he said.
The idea of spending thousands of dollars on tablets didn’t sound reasonable, so Kim started doing research on the Internet and getting referrals to manufacturers in China with the thoughts of producing a tablet that could be purchased by the masses. He took his first trip there early last year, meeting with executives, parts suppliers and local manufacturers, and he plans to go back in a month or so for his fourth trip to the region.
First Tablet
Idolian unveiled its first 10-inch tablet last year. The model sold for about $210 and drew scant attention.
The company has a deal with Santa Ana-based Ingram Micro Inc., the world largest technology distributor, but the margins aren’t high enough to use Ingram’s services at this point, Kim said.
For now, the company is shipping units of both of its models from Amazon warehouses and from Idolian facilities in Arkansas and Newport Beach. The company is opting for direct sales channels rather than wholesale because it doesn’t have sufficient capital for fuller production.
Kim self-funded the business, and the company might soon seek private investment. Kim said its tablets are seeing strong interest from car dealerships, wireless carriers and retailers purchasing bundles of units for use as promotional items.
Irvine-based 4G Wireless Inc., a Verizon Wireless retailer, recently concluded a trial test using the IdolPad Plus tablet. A promotion on its website includes a free tablet with a $100 purchase of the Verizon Jetpack, which connects up to five devices to a Verizon wireless network.
Idolian is in negotiations to sign a long-term deal with 4G Wireless, Kim said.
