Tech companies like to hook customers when they’re young.
If a company can get young people to use your products, the logic goes, then they’re likely to remain customers when they grow up and enter the workforce.
If that’s true, then the iPad’s struggle to break into the U.S. educational market is a very bad sign for the company.
Apple’s share of the United States “K-12” market has fallen to new lows, according to data released by researcher Futuresource Consulting on Friday. Apple’s iOS operating system — mostly iPads — accounted for only 17% of institutional educational purchases in the first quarter of 2016. (Mac laptops accounted for only 4%.)
The drop in iPad sales is particularly dramatic. In 2013, they accounted for nearly 40% of K-12 institutional purchases.
“Apple’s numbers are down. Sales to education are declining,” Mike Fisher, Futuresource analyst, told Business Insider. “As the market has matured, I think Apple’s approach to the educational market probably needs to change a little bit.”
Instead of buying iPads, schools are turning to low-cost Chromebooks, with a Google-provided operating system, which made up 51% of institutional purchases during the quarter, according to the study.
Test machine anxiety
There’s evidence that Apple has some anxiety about the iPad’s declining sales in the educational market.
CEO Tim Cook dismissed the usefulness of Chromebooks and cheap Windows laptops in schools last December, calling them mere “test machines.“
But just weeks ago, Apple quietly introduced a program in which it would buy back old computers from schools, including “qualifying peripherals from any manufacturer” and provide schools with credits they could use to purchase new Apple computers.
One email sent by an Apple account representative to institutional buyers suggests Apple will pay $75 per iPad and $225 for a six-year-old iMac.
One part of the issue is that Apple only sells to schools through its salesforce, as opposed to Chrome, which is supplied by a variety of different hardware makers and resellers. Apple’s educational salespeople may be finding that they don’t have the leverage they once did.
“We see that the iPads are consumer devices. They’re about as close to commodities as consumer devices get,” Hal Friedlander, co-founder of the Technology for Education Consortium and former CTO for New York City schools, told Business Insider.
“Apple doesn’t allow resellers to school districts, you have to buy directly from Apple, ” he said. “In other words a district would have to state that Apple products are unique in the world and no other manufacturer or seller sells anything comparable, so we must buy these products directly from Apple.”
Although Apple publishes educational sales prices, Friedlander says that those prices aren’t necessarily what an Apple sales rep would quote to a school. It’s not hard to imagine buyers fed up with the lack of transparency would prefer purchasing Chromebooks, which have multiple vendors competing.
Not right for the job
There are growing concerns that Apple’s iPad might simply be ill-suited for a school environment. First of all, it doesn’t come with a keyboard, which is still essential — and legally required — for taking standardised tests. Second, it’s hard to shed a reputation as a device that’s not suited for serious work.
In one district in Maine that gave iPads to students, 88.5% per cent of teachers said they preferred laptops. According to the Lewiston-Auburn Sun Journal, one teacher said that iPads “provide no educational function in the classroom. Students use them as toys.”
In addition, iOS has lagged behind Chrome and Windows in providing administrators with tools to easily set permissions and install software for hundreds and thousands of students.
But Apple is taking steps to improve its educational software. Earlier this year, it released an Apple-developed Classroom app that will help teachers track students through various lessons. And it purchased LearnSprout, a startup that worked with student data.
Google isn’t standing still either. It recently announced that Android apps would work on Chromebooks, giving teachers even more software that they can incorporate into Chrome-centered lesson plans.
The battle is likely to continue for years. As the worldwide tablet and laptop markets stall, education is one of the few remaining growth areas.
“Look at the laptop market. It’s flatlining. Declining. So K-12 is the area of growth,” Fisher said. “Simple maths. There’s 1.5 billion students in K-12 globally. The digital education opportunity is likely to go into the multi-billions.”