This year the tablet industry is going to get interesting, gnarly even, because as the market matures a bunch of very smart power plays will happen. It starts with Google.
We know Google's been working on Android in an attempt to polish a version that really is designed to embrace the larger screens that tablet PCs offer over smartphones. We also know that Android 4.0, the product of this work, is a gentle attempt to claw back some of the problems of platform fragmentation (recent news confirming this). Android 4.0 will be married to some of the newer, more powerful tablet PCs coming from manufacturers like Samsung, and it may be the first serious competitor to Apple's iOS on the iPad—something that's not really existed until now, in terms of smooth user experience, power, and optimized use of screen real estate.
Then we heard rumors that Google was prepping its own tablet PC that would carry the Google brand, perhaps in a similar way to the Nexus line of Android smartphones. The Nexus phones have't exactly stolen the limelight, though, because the Android smartphone market is cluttered and Samsung is doing a good job of competing with Apple (largely by copying it, some may say) and selling devices. It's possible a Google tablet could succeed, because there's no lead competitor to the iPad yet.
A newer rumor still offers hints at a 7-inch device of the "highest quality," according to Google's Eric Schmidt, and it's said to fall below $199 in price. It could devastate the Kindle Fire in two important respects. First, it's slightly cheaper. Second, it's got the words "Don't Panic" inscribed on its cover in large, friendly letters. We kid: Actually while the Kindle Fire has seen Amazon bury all signs of normal Android beneath a completely Amazon-centric UI designed to funnel only Amazon book, music, and video content to the end user, Google's tablet will be quintessentially Android 4.0—and thus full-featured. Remember how consumers shied away from netbooks when they realized they were cloistered, non-full-featured laptops? The same risk is what Amazon's exposed to here, now that the tablet paradigm is well established.
Speaking of the Fire, analyst Tavis McCourt of stockbrokers Morgan Keenan has just courted controversy by actually lowering his predictions for the fourth quarter iPad sales figures of 2011 to 13 million from 16 million. It is, McCourt attests, a direct reaction to predictions about sales of the Kindle Fire over the holiday period—sales which may have reached between four and five million units. In McCourt's mind this will have directly compromised iPad sales, as there's only so much money to go round.
Evidently this is a money man holding his wet finger to the wind—a mythical total—and adjusting his earlier predictions based on what he says he senses in the technology-sales breeze. And as we've noted before, analysts seem to be confounded by the simplest moves of Apple. McCourt's analysis also flies in the face of some predictions and statistics that support continued strong iPad sales over the holiday period: Before it arrived some slightly more grounded predictions, based on a deeper insight into the industry, suggested that while the Fire and Nook devices would sell well at Christmas, they'd not really threaten Apple. 7% of purchases made online on Christmas day actually happened by users dabbing at the screen of their iPad—a massive figure that underlines the iPad's dominance of the market.
But McCourt's moves are a sign that the Amazon tablet really has made a splash in the marketplace, and if rumors that Amazon is moving to release a new and updated Fire sooner rather than later prove true, then Amazon will certainly consolidate its position.
And then finally there's Apple. Rumors about the iPad 3 are swirling faster than ever—merely because the device is expected to get its public reveal toward the end of January. The iPad 3 is said to be a radical departure from the earlier iPad design, which is already iconic, sporting a high-resolution "retina"-level display that beats most laptop screens and new IGZO display tech which is better even than the IPS system Apple touted as one of the original break-out iPad features. With faster processors, much improved cameras (possibly a 5 megapixel autofocus one) and what's said to be significantly better battery life, the iPad 3 is likely to set a completely new high bar for the fledgling tablet game, and truly defeat naysayers who suggest tablets aren't full-featured machines suitable for content creation or purposes like high-end gaming. If Apple keeps it pinned at the $499 price point at the low level, it's certain to sell by the millions.
But it's not the iPad 3 that's likely to be Apple's smartest move in the tablet game. Many a rumor is now suggesting that Apple will keep the iPad 2 in production and on sale, but at a lower price. This is borrowing from the incredible success of the iPhone 3GS, still on sale at bargain prices and selling hand over fist. The figure being mentioned for the new iPad 2 is $299—an amount that will seriously threaten the Kindle Fire because it's just a few bucks more, for what's evidently a better machine and one that's got much more potential and cachet. If Apple really does embrace the 7-inch genre, as other more rarified rumors suggest, then this could even come in below the $299 price, and challenge the upcoming Google tablet.
So banish any thoughts that the tablet game is going to be boring this year. Considering how stagnant the PC market has got, and how samey the smartphone business is becoming, it may even prove to be one of the most exciting consumer tech battlegrounds. Oh, and if you're pondering a tablet purchase—even in the sales, or with Sony and RIM knocking many dollars off their prices—it may be best to hold off for a couple of months.
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