IPad Accessory Makers Worry About Compatibility


Thousands of entrepreneurs are banking on selling accessories for the next iPad, which Apple is widely expected to unveil on Wednesday.

The $2.3 billion market for iPad and iPhone accessories is so robust that about 90 percent of owners buy at least one add-on for their device, says Gene Munster, an analyst at Piper Jaffray. Selling an accessory "is really a quick way to get rich for a lot of people," he adds.

Products range from cases and covers to portable keyboards and speakers and even Square, a device for processing credit card payments. Square has more than 1 million users and has processed more than $4 billion in transactions.

Entrepreneurs Steve Isaac and Brad Melmon placed an early bet on the next iPad. They came up with TouchFire, a rubber overlay for the iPad, which gives the feel of a physical keyboard. The ultraportable keyboard is just going into production after a year of design and fundraising, and Isaac and Melmon hope the new iPad won't have a radically different shape.

"It's incredibly tense right now," Isaac says. "We think it is (compatible), but we don't know."

And there already are iPad-compatible keyboards on the market. Kensington and Logitech are among the many accessory makers who make keyboard-case combos outfitted for iPads. They haven't advertised specific units as of yet for the next iPad.

Apple doesn't share new designs with vendors and partners before it makes its carefully scripted and staged product introductions, such as the one Wednesday in San Francisco.

The first iPad was introduced in April 2010, intended primarily for entertainment, such as watching movies and TV shows, showing photos and reading books. But it has evolved into a hugely important and popular device for businesses.

Some users, however, don't like the touch-screen for composing long e-mails. "It's the one unmet need people have," Isaac says.

Isaac, a former product manager at Microsoft, and Melmon, a Seattle-based designer, came up with the rubber keyboard, which will be on sale by the end of the month, for $49.99.

To finance the venture, they turned to Kickstarter, a website that's become the go-to place to float ideas, and raised "$200,000 in five days."

(Other success stories at Kickstarter include an iPhone dock that's fetched $1.4 million, and $942,578 for an iPod Nano watch.)

The $200,000 represents orders for 4,500 units, once they come off the assembly line. Some 2,000 additional orders were placed on TouchFire.com, where the product will first be sold.

"It feels like a whole revolution is happening," says Isaac. "You can now go directly to consumers, instead of institutional investors. That's really exciting."

Munster projects sales of 60 million iPads this year — on top of the 55 million that have already sold — and 135 million new iPhones. "There's just a lot of chances to sell somebody something," that taps in, he adds.