Is The iPad An Endangered Species?

Thirteen months after its debut, the iPad remains the tablet market leader, despite the recent onslaught of Android-based tablets coming to market. According to one CEO, Apple’s dominance is the result of three factors. Only after addressing each of these will Apple’s competitors have any chance of weakening the dominant player. According to Nvidia CEO Jen-Hsun Huang, Apple is winning the tablet war because of pricing, marketing, and content superiority. Huang, whose company supplies the core piece of hardware inside Android Honeycomb tablets, offered his assessment to CNet. He states, Android-based tablets are losing because:

"It's a point of sales problem. It's an expertise at retail problem. It's a marketing problem to consumers. It is a price point problem. And it's a software richness of content problem."

Android’s Pricing Problem Huang believes Android-based tablets lost significant ground to Apple because the first models focused on providing 3G services. The result was higher prices versus the Wi-Fi only iPad models. Speaking about the pricing of Android-based models, Huang states:

"The baseline configuration included 3G when it shouldn't have. Tablets should have a Wi-Fi configuration and be more affordable. And those are the ones that were selling more rapidly than the 3G and fully configured ones.”

Currently, the Motorola Xoom offers a Wi-Fi only model, with pricing starting at $599. Meanwhile, the BlackBerry Playbook has recently introduced a $499 Wi-Fi only model. Unfortunately, at least for Android supporters, Huang offered nothing to address the other two problems facing Apple’s competitors, except to say:

"But those problems are all getting solved. The rate at which these Honeycomb Tegra 2 tablets are being improved is really stunning. I think all of the manufacturers have now recognized that and readjusted their plans."

Apple’s marketing advantages In discussing tablet marketing, CNet turned to DisplaySearch analyst Richard Shim. Speaking on his blog, Shim says Apple is doing much better at marketing its brand versus Android-based providers. He states:

"Apple is not only better able to explain its product to consumers through dedicated sales people, but it also captures more margin than competitors who have to share margin with retail partners.”

Shim contends Best Buy’s decision to create dedicated Tablet Central areas within its stores and online will help (Android devices), but:

"While we continue to believe that there are challenges...creating a separate section for tablets is a good start."

Apps, Apps and More Apps Finally, we turn to Apple’s content superiority. Strangely, Huang, CNet, nor Shim addressed this problem, which we believe is the most important reason Apple will remain top dog in the tablet market. To date, the App Store has nearly 90,000 iPad-specific apps. In the Android Market, this number is around 100. In our opinion, even when Android gets past pricing and marketing obstacles (which they will), their tablets will remain crippled by the lack of content. Apple offer thousands of apps, each when bought, ties the customer even more to the App Store. What do you think? Leave your comments below. [Photo: http://mrchazratpez.deviantart.com]

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