(Reuters) - When John Sperling, 91-year old chairman of Apollo Group Inc APOL.O, calls into meetings at the education company he founded, he opens an iPad app Fuze instead of video conferencing gear installed at his home.
Software crucial for corporate users - such as apps for video conferencing - has started to find its way into Apple’s (AAPL.O) iPad and other tablet computers, opening the door to potentially vast demand for tablets from businesses.
“As applications develop and more business apps are rewritten for touchscreens we will see more and more enterprises migrating to tablets,” said Canalys analyst Tim Coulling.
Several software firms said they are seeing fast growth in their tablet applications.
“We are seeing rapid adoption of tablets across a lot of highly regulated sectors - from public utilities to financial services, banking and healthcare,” said Dimitri Volkmann, vice president for products and markets at Good Technology.
Up to 10 percent of 119 million tablets to be sold this year will be bought by companies, analysts said, but even larger amount will be acquired through increasingly popular buy-your-own-device (BYOD) programs, which allow workers to pick their device, while companies pick up the bill.
“In 2012 it appears that in order to win the enterprise, you need to win the consumer first,” said Duncan Stewart, director of TMT research at Deloitte.
This will make it increasingly difficult for Microsoft (MSFT.O) or Research In Motion RIM.TO to break into the market where consumers are favoring market-leading iPads and tablets using Google’s (GOOG.O) Android software.
MICROSOFT‘S TO LOSE
“Microsoft and all its licensees are late to the game, but for all Apple’s inroads into enterprise markets, it’s still Microsoft’s fortress to lose,” said John Jackson, analyst at research firm CCS Insight.
Research firm Gartner forecast on Tuesday limited success for Microsoft’s high-profile push into the tablet industry with its Windows 8 platform, with the U.S. software maker remaining a distant No. 3 behind Apple and Google.
In addition to traditional PC makers, Nokia NOK1V.HE, the world’s largest cell phone maker by volume, is set to unveil its first tablet using Windows 8 software later this year.
Gartner said it expected corporate purchases to boost Microsoft’s market share to rise gradually from 4 percent this year, but to reach just 11.8 percent in 2016 as it lacks consumer appeal.
This compares to Apple’s share of 61 percent this year, and Android’s 32 percent. Analysts said Apple’s share of corporate market was likely even larger as many firms have shied away from using Android tablets due to fears over their security.
The share of tablets sold into enterprises, directly or through buy-your-own-device programs, will rise to around 35 percent by 2015, Gartner said, with direct sales making a minority.
“This poses a big threat to vendors that thought about focusing on the enterprise market who will now have to become appealing to consumers as well,” said Gartner analyst Carolina Milanesi.
Corporate application developers are increasingly seeing Windows 8 as the third platform.
FuzeBox, creator of the Fuze video conferencing app that Apollo’s John Sperling and 2.5 million others are using, has started to work on a version for Windows 8, but it has dropped Blackberry due to its declining influence.
Apollo Group managers learned to use remote meetings with their traditional video conferencing equipment, which cost them more than $1 million: today they pay a fraction of that.
Reporting By Tarmo Virki in Helsinki; Editing by Tim Dobbyn