None of the would-be competitors of the iPad (AAPL) have fielded a serious challenger. None of the pad-like Android devices on the market now are close to the iPad’s quality, and all are demonstrably short of features. For the most part, they are cheap knockoffs, and all the cheapness of design and construction are apparent to anyone who picks one up.
A more serious challenge is expected soon from Samsung (SSNLF.PK), one of the most competent Korean manufacturers. The Galaxy 7, pictured below, is close to a formal announcement that it will be on dealer shelves sometime in September. Samsung makes high quality products, and they have several years’ experience working with ARM chips with touch-screen control. Their new tablet should be able to stand up to the iPad in quality and in features. It will be one of the best tests of how well the Android will do on an expanded screen size.
Speaking of 7” screens, Apple is reportedly readying a 7” version of the iPad for the Christmas selling season. According to Taiwan’s DigiTimes Taiwanese companies are already starting to assemble this new device. Their report was also corroborated by many other Asian sources over the last month. When a company gets as large as Apple, it is hard to find a bushel large enough to hide its light.
According to DigiTimes the 7” inch model:
. . . would be making a jump to the Cortex A9 processor core, 512MB of RAM like the iPhone 4, and a 1,024 x 768 pixel IPS panel -- the same resolution as the 9.7-inch iPad, giving the new model a better pixel density.
In my opinion, if Apple brings out a 7” iPad, it will put severe price pressure on most of the other vendors in this space. Apple will begin with a large scale production run, so the economies of scale are all on Apple’s side for now. They will probably stay that way for a long time to come.
On this side of the Pacific we have three more American firms that have stakes in this market:
· HP (HPQ), the world leader in PC manufacturing. · Microsoft (MSFT), the world’s largest software company. · Google (GOOG), the world’s leading search engine. Each of these giants has its own agenda regarding tablet computers, and it is from them that we should expect major efforts. Certainly there are enough rumors swirling around that implicate them in these ambitions.
Apple, as usual, was way ahead of the curve in moving to this new form factor, and now the rest must play catch up — never an easy thing to do when you give your competitor almost a year’s head start. If this were a high jump competition, Apple would have cleared 8’ on its first attempt. Two of our grandees (HP and Microsoft) would be caught flatfooted, and only Google could make a credible attempt at that height with its Android OS. But, it is yet to be seen if Android, in its large screen manifestation, can clear the bar at Apple’s mark.
Here is what is expected from the bunch at the back of the pack:
HP has a major redesign of its slate device to accommodate their newly acquired WebOS. Their final product may be delayed for as long as January of next year — not a pleasant thing for HP to contemplate. Most unfortunately, HP seems to have more than a full plate in coping with the recent and unexpected departure of their CEO. The urgency of the need for a new leader cannot be overstated.
Microsoft’s new operating systems, Windows 7 and the Phone version, have a few fans. HP is rumored to have Windows in mind for one of their new slates. It would be positioned as a business complement to its consumer-oriented WebOS slate. Also, several of the Korean and Taiwanese manufacturers have a wealth of experience handling Windows operations, so their hats will probably be found in the ring within the next few months. In addition to Samsung, LG (LGERF.PK), Kyocera (KYO), and HTC (HTC) also come to mind as potential partners for Microsoft. Presently, Google is in the spotlight with its rumored Chrome OS-based tablet. The Chrome OS is probably a derivative version of Android, and it has been in the works for some time. It will be the core of a Google-branded tablet that is expected to be introduced on November 28th of this year. This device also doubles as a smart phone and probably will have a 7” screen. The rumors suggest that Verizon (VZ) will be first to offer it as a 3G Chrome device on the November launch date. 
The picture above shows nothing more than a concept device that may or may not look like the production model. It will reportedly be built by the Taiwanese firm, HTC, which has extensive experience with both Windows and Android operations. It also has a well-deserved reputation for innovative design work and high quality production.
There is one more American firm that is likely to be adversely affected by the new crop of slates and tablets: Amazon (AMZN). None of the devices discussed are stand-alone eReaders, but it is likely that all of them will have eReading software as part of the package, at least as a downloadable app. Amazon will probably have its own app ready for this purpose. But that readiness relates more to eBook sales than to sales of Kindles. In one sense, every new tablet sold is a potential loss of some of Kindle’s market share. The Kindle has weathered the iPad assault so far, but with ten or twenty other devices that may eventually come to market, it’s not hard to see Amazon bleeding from a thousand tiny cuts. I don’t know how this will affect their bottom line, however, and I am not one to short-change Amazon’s ability to compete. They have responded effectively to all the challenges that have come their way. But no rest will be available to them in the future as the eReading industry matures.
It looks as if the last half of 2010 could be as exciting as the first!
Disclosure: No positions
