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April 17, 2015

Xplore acquires Motion -- what it means

On April 16, 2015, Xplore Technologies and Motion Computing announced that Xplore was acquiring Motion. This was not a total surprise as both companies are in the rugged tablet computer market, both are pioneers in tablets, and both are located within ten miles from each other in Austin, Texas.

And yet, the announcement came as a surprise to me. When I had interviewed Motion CEO Peter Poulin in February of this year, Poulin had ended with saying "Motion is in a good position. According to VDC, Motion is the #2 player in rugged tablets, more than twice as large as #3," and he followed up with saying the company had just totally revamped all of their platforms for much greater performance and enhanced wireless communication and ruggedness. And that they had other products in the pipeline. "We're quite optimistic," Poulin concluded. And yet, just a couple of months later, Motion was acquired.

The move was also a surprise because both Xplore and Motion have shown remarkable resilience from setbacks and challenges throughout their existence. In an era where numerous rugged computing gear manufacturers either folded or were absorbed by either Motorola or Honeywell, Xplore and Motion persevered and remained independent.

As a privately held company, Motion's business fortunes were closely guarded, but the company's savvy, skills and determination were apparent throughout its history, starting with the unenviable task of taking Microsoft's flawed 2001/2002 Tablet PC initiative and running with it. Though highly publicized and initially supported by most major PC manufacturers, the Tablet PC didn't find widespread acceptance due to high costs and technology that just wasn't quite ready yet. Yet, Motion toughed it out and established for itself a nice niche in enterprise and vertical markets.

Both Xplore and Motion were especially skillful in recognizing valuable technology advancements early on, and quickly making them available to their customers. Both companies were pioneers in such productivity-enhancing features as dual input where pen and touch worked in harmonious unison, superior outdoor-viewable displays, ergonomics suitable for actual tasks at hand, and the ability of their products to not only hold up in challenging daily use, but also perform at full speed under any operating conditions.

On the Motion side, the company's early adoption of Intel's Mobile Clinical Assistant (MCA) platform was an impressive example of their unerring compass of what worked and made sense, and what didn't. Motion's C5 MCA -- with its square layout, integrated carry handle, and peripherals placed in the exact right spots -- became a big success, so much so that Motion added an F5 version of the platform for general enterprise and industrial use. Most impressively, while a good dozen other companies also introduced Intel MCA-based tablets, most quickly abandoned them again, lacking Motion's razor-sharp focus on their markets and tablet products.

Fellow Austin resident Xplore impressed through sheer determination. Time and time again Xplore found new investment as the company's leadership tirelessly presented its case. Which wasn't always easy with what for a long time essentially was a one platform product lineup.

I well recall first seeing them at a Comdex trade show in Las Vegas in the late 1990s where they had a large, terrific display, a convincing message, and jaw-dropping prototypes that, however, were not quite final yet. That was quite common back in those days, and most of the attempts led nowhere. But Xplore was back the next year, and the year after that.

When we published the Pen Computing print magazine and did annual Editor's Choice and best product awards, Xplore scored with its impressive GeneSys Maximus. I remember calling Xplore with the good news, and they were disappointed that it was the GeneSys that got the recognition, and not their then semi-secret brand-new iX104. Little did we know that that machine was to become the core engine of Xplore's success and future.

So why Xplore and Motion got together now, after all those years, I don't know. Business imperatives, I assume, and I am sure it makes perfect sense. But what does it mean looking forward, especially in the light of many such acquisitions that did not work out for the best? In the past we've seen large companies almost mindlessly snapping up much smaller ones. That's not the case here. We've seen fierce competition where one competitor eventually came out on top and annihilated the other. That's not the case here either. So let's see what Xplore and Motion bring to the table.

Historically, Xplore has been tending to the ultra-rugged tablet market whereas Motion concentrated on a variety of vertical markets that required durable, specially designed and configured tablets. Motion does not have anything that competes with the various versions of Xplore's ultra-rugged iX104 tablets (see here). Xplore doesn't have anything like Motion's C5 and F5 semi-rugged tablets with their integrated handles. Xplore also doesn't have anything like Motion's R12 tablet with its big 12.5-inch screen (see here). So there's no overlap there. And Motion doesn't have anything Android-based, whereas Xplore has its modern, innovative RangerX tablet.

There is a degree of overlap in just one area, and that's in the promising and potentially quite lucrative area of compact lightweight Windows tablets. That's the tablets for users who do need Windows, but want it in a trendy, sleek and attractive iPad-like design that's tough enough to hold up on the job. For that Xplore has their Bobcat (see here) and Motion has its CL920 (see here). These two, though, are also different enough to be able to co-exist in the short term, the CL920 the unified company's enterprise market tablet entry and the Bobcat for tougher assignments that require more armature and a higher level of sealing.

Most importantly, there is very little existing customer overlap with these two companies. Xplore has traditionally concentrated on oil & gas, military, government, heavy industry, and similar, whereas Motion is primarily active in healthcare, retail, construction, field service, and so on. If Xplore plays its cards right, it can emerge as a much larger company with a much broader reach, and also perhaps as an example of where 1 + 1, for once, adds up to more than 2. I've said it ever since the consumer tablet boom began, and I'll say it again: with the tablet form factor fully accepted virtually everywhere, there's tremendous opportunity for rugged equipment vendors to step in and successfully provide this desired and contemporary form factor in products that do not break on the job and in the field.

Overall, this development may also be good news for other independents in the rugged tablet market, companies like Getac, GammaTech, MobileDemand, the Handheld Group, and others: resistance is not futile. Keeping it in the family and preserving the unique, special expertise of the rugged computing industry may well be the best way to success and prosperity.

-- Conrad H. Blickenstorfer, 4/16/2015

Posted by conradb212 at April 17, 2015 12:05 AM

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