first_imgThough most of the world didn’t know it, tablet computers existed long before the iPad. They were clunky, ran Windows, and required a stylus; but they were tablets nonetheless. Then Apple came along and revolutionized the category. Now, less than two years later, a new tablet revolution is about to take place–only this one will be led by content providers Amazon and Barnes & Noble.Up to this point, Apple has seen little serious competition. Despite hyped launches of numerous Android tablets, none have gained much of a foothold. Even deceptive sales figures that compare shipped Android slates to sold iPads still show Apple’s device holding onto over half of the market.Much of the problem stems from Android’s separation of software and hardware. Makers of previous Android tablets couldn’t profit off of the Android ecosystem, and they don’t have any meaningful content to sell after the initial purchase. So they’re left trying to beat Apple on hardware alone, while struggling just to match the iPad’s $500 starting price. It’s been a losing battle.Now here come Amazon and Barnes & Noble, who are able to attack from a different angle. This new game is based not on hardware, but on price. As their digital goods can be prominently featured on their tablets, they can afford to sell their devices either at cost or for a small loss. When you walk out of Best Buy with a Galaxy Tab, your financial relationship with Samsung is over. When you walk out with a Kindle Fire, it’s just the beginning of a beautiful friendship with Amazon.This subsidization of content will allow the tablet market to explode with new buyers. Millions of people who have never owned a tablet before will be buying a Kindle Fire or a Nook Tablet. What was previously the iPad market will finally be accurately described as a tablet market.The ramifications will stretch beyond just the short term. Customer expectations are a powerful force, and they will play a big part here. Most people don’t care why one tablet is able to be sold cheaper than another. All they’ll know is that the Kindle Fire costs $200, the Nook Tablet is $250, and everything else is expensive. If a tablet is over $300 and it isn’t called the iPad, customers won’t give it a second look.Manufacturers will be left desperately searching for a way to compete on price. After the Motorola purchase is finalized, perhaps Google will feel pressured into making their own subsidized tablet. Apple is still in the power position, but even they may decide to offer the previous year’s iPad at a lower price point. Within a year or two, the iPad could be sitting on the high-end range of tablet prices, much like Macs sit in the more costly tier of the PC section.When that happens, we’ll be able to look back at this holiday season as the second big turning point in the evolution of tablets. It won’t happen as loudly or dramatically as the iPad’s entrance did in early 2010, but it will be nearly as important. It will be remembered as the point when competitors stopped trying in vain to outdo the iPad, and started — successfully — to undercut the iPad.¡Viva la revolúcion!last_img

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