Tablet wars set for Apple vs Amazon head-to-head If Amazon makes enough tablets and prices them right, the company will sell lots of the gadgets, according to Forrester Research's Sarah Rotman Epps. "If [Amazon's tablet] is launched at the right price with enough supply, we see Amazon's tablet easily selling 3m to 5m units in Q4 alone," she said. If… If… Apple sold 7.3m …
Asus alone are shifting 1m Asus Transformers a month, 3m a quarter, plus there are all the Xooms and Galaxy Tabs.
Surely Android in total must be knocking at the door of iPad sales numbers? Sure it's not a single supplier that's doing it, but that will come next.
And as for this tripe about Amazon being able to make a GOOD and CHEAP Android tablet, it's not going to happen. A decent IPS panel with a capacitive touchscreen it over £100 component cost, so you are looking at £199 AT BEST for something that is of adequate quality.
The raft of cheap and nasty £150 Android 2.2 tablets should be enough of a indicator to everyone that it's not currently possible to make something good for less than £200 at retail.
I'm waiting with bated breath to see what the AndyPad people release tomorrow. I don't mind a dodgy screen for sub-£200 as long as it's reasonably responsive - battery life is more of a concern for me as I'd want it to last all day with quite intensive use, and it's another failing of these cheap nasty Android tabs.
Plus I assume that component cost is for a 10" screen. I suspect Amazon might not necessarily limit themselves to that - a smaller screen would be fine for a tablet/e-reader combo and would cost less.
After all, it took Microsoft until 2008 just to break even on Xbox sales. Most games console manufacturers make a loss on the hardware, assuming you're going to buy a few of the vastly more profitable games for your new toy.
Amazon have the Apple-style advantage of being able to control everything from hardware to content. They can make money on e-books and online ordering while promoting a cheap but good tablet as a loss leader. Especially if they can nail a few good exclusives for an Amazon App Store to run in conjunction with the usual Android Market.
Add in Whispernet capability, and that's something that NO other tablet manufacturer has managed yet. Maybe license Notion Ink's dual active/passive display (assuming it's any good) for incredibly enhanced battery life. Impossible? Nah, I wouldn't say so.
I think the point is that Amazon's Tablet needs to significantly undercut the iPad.
We are not talking Kindle pricing here but more like £400-£500 for whatever matches the £600 iPad say. If they bring out yet another tablet priced the same as the iPad they will shift far less.
Completely obvious of course but something that was not obvious to HP who thought people would be willing to pay the "Apple Tax" for a non-Apple product.
"We are not talking Kindle pricing here but more like £400-£500 for whatever matches the £600 iPad say. If they bring out yet another tablet priced the same as the iPad they will shift far less."
There is no reason they should charge more than £300 for these things, especially if they're subsidized. Prices for unsubsidised tablets is already falling to £350 (e.g. Iconia Tab A500) and is likely to fall further. Archos are releasing a new model shortly which is likely to be £300.
So I would expect that an Amazon device would be £299 or less. Or £250 or less for models where the screen is < 9 inches.
Remember MS' XBox "shipments" and how they stuffed the channel? Don't equate shifting a million units with selling them.
I do like my kindle, but the user interface leaves something to be desired. And a tablet, which is a more generalized piece of equipment than a reader, needs better UI design. So consider me skeptical.
It has been well documented with the recent HP Tablet fiasco, it seems that $300 is the real cost of the components and other costs to build a 10in Tablet.
If Amazon start selling one (with a different screen to the Kindle) for the same sort of price as a Kindle I am pretty sure that Apple and the other Tables makers will be complaining to the FTC about selling for less than its raw cost.
Mike, I think you're vastly overestimating the number of Xooms and Tabs that have actually sold (as oppose to being sat on warehouse shelves). Plus it would be amazing if ASUS were selling 1M transformers a month given they said a couple of months back they were only making 300,000 a month. I think it's likely ASUS are selling about that many.
Apple has (depending on your source of information) between 80 and 95% of the existing in use tablets, and they're selling as many as they can make too, which I suspect may be as many or more than ASUS can make. Samsung are selling no Tabs at all in the EU thanks to Apple's legal attack dogs and the Xoom... did the Xoom ever actually launch in the EU at all?
Ask yourself : how many iPads do you actually see people using, and how many of the competition?
I agree with your fundamental point though - there's a bare minimum cost for making a tablet that doesn't feel like a piece of crap and if you want to compete with the iPad, your tablet has to not feel like a piece of crap. The problem is then being able to do it cheaper than Apple, who benefit from massive negotiation leverage with suppliers.
=IF
I make technology product that people will like
AND
I market said product in way that appeals to all ages
AND
I put a decent price tag on item to bring in a nice profit margin
AND
I develop my product lines in keeping with changes in consumer needs and requirements
THEN
I will be > all tech companies in the world.
ELSE
I will fail like the rest.
The thing I am most interested in about the Amazon device is knowing if they have made their peace with Google and it will ship a relatively open and compliant 3.x device with Google apps, or whether it will be proprietary 2.x branch and locked down to only consume Amazon's app store and other services.
If the latter I suspect it will be cracked lickety split especially if Google spoil their launch party by releasing the Ice Cream Sandwich source code at the same time.
The Barnes & Noble Nook Colour looks pretty decent, for under $250. Its counterpart, suitably updated and equivalently priced on this side of the Atlantic, would probably sell pretty well.
I'd buy one, for a start.
All it'd take is another 2,999,999 likeminded sorts to prove Epps right. Wouldn't that be nice?
Remined me where I can buy a Colour Nook in Blighty (Not off Ebay please). You know the ones that have full support from B&N.
I am sure than many El Reg readers would like to have one but aren't going to fly to the US to get one or buy a grey import or wait a month while UPS/Parcelforce ship it by sea and hopefully don't break it on the way AND pay the import duty, VAT and Parcelfoce Tax as well.
Beer simply becase of the delightful (but all too few) pints of Harvey's Sussex Best I had in the Crown at Turners Hill over the weekend.
The reason why Amazon can sell the Kindle so cheap is (wait for it) because it's cheap. If HP can't get the bill of materials for the OuchPad much below that of an iPad, then how exactly are Amazon? I bet HP buys a tonne more components than Amazon ever do.
But wait, they can subsidise it with content! Again, how? What content does Amazon have access to that Apple don't? It's essentially the same music, books and films from the same media companies as Apple. So, I don't suppose the wholesale price is going to be much different. And we know that Apple doesn't really make much profit on the content -- it's used more as a reason to support their hardware business. So, how is Amazon going to reverse this model, while still keeping the content competitive withApple? Answer, they can't.
The only thing I can see the, doing is some sort of subscription pricing. But then, surely the network operators would be more successful selling tablets today, if this is how people wanted to subsidise a tablet...
Has this Forrester researcher actually done any sums?
Cheap Android tablets sell well in Brazil, Russia, India and China. That's where nearly half of the people in the world live. They sell so well that hundreds of manufacturers are killing each other with low margins to get market share, or just even a little profit. Some of their output is even leaking out here on eBay. Cheap Android tablets sell well in other places too, but in BRIC they're rocking the world.
Android tablets may be the platform that brings the rest of the world online. It's got everything: low power, long battery life, low cost, high utility, wifi, carryability, hideability. Some of them can be read in harsh sunlight. Yes, the poor response of the resistive displays and low-spec processors make Transformer's poorer cousins unsat for Western use. But if your village has poor or intermittent power and you need to Google how to pump a well or find out if these red bumps on your skin are fatal, you don't care if the thing can play Angry Birds. In a nation of the blind, the one-eyed man is king. To most folks in this world the ability to Google stuff is of far more value than NetFlix, iMovie and GarageBand.
When they come online I, for one, am eager to hear what they have to say - to meet them online and engage with them. They have as many smart people among them as we do, and the global conversation may be improved. I hope we don't scare them off.
And in those nations amongst the few who have good money, the iPad sells well too, as it should - it's nice gear. Where most of the world lives money isn't something easily got for most people so for the rest it's nice there are these other things that can be had that are so useful.
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