Could the Wrong Price Flatten Apple's Tablet?
1/13/2010 01:01:00 AM
kenmouse
, Posted in
Expectations for an Apple tablet can't get much higher, and when and if Apple reveals one, it'll no doubt be an intriguing bundle of hardware and software. However, as we know them now, tablets represent a not-so-necessary missing link between smartphone and computer. Will Apple be able to convince us that we need yet another mobile gadget, or will its price put this mythical "iPod slate" out of reach?As the Apple tablet rumor frenzy blows way past the level of a fever pitch, I'm starting to reconcile myself with the notion that we may -- within a few weeks -- finally hear from Apple. The company is widely expected to make a public announcement Jan. 27 or so, though again, the expectation isn't due to Apple, it's due to a report stating the company has rented a stage at the Yerba Buena Center for the Arts in San Francisco.
What might Apple announce? A tablet, of course, perhaps an "iPod slate." E-readers and tablets were all the rage at this year's Consumer Electronics Show (CES) last week, so maybe the timing is finally right for Apple. Either way, if Apple does indeed announce a new device, I'm starting to seriously wonder if I'll actually buy one.
However, I'm already afraid it'll cost too much money.
Price vs. Value
Here's the deal: Any sort of e-reader or tablet device tends to live in this weird no-man's land. A tablet doesn't have the core workhorse power of a laptop form factor, and it might not even be as practical for work as a netbook. Yet it's also not an iPhone, nor is it even a companion fit-in-your-pocket iPod touch.
If we were talking basketball, an Apple tablet seems like it could be dangerously analogous to a jump shot made with one foot standing on the three-point line. It's still a relatively high-risk shot, but it doesn't come with the benefits of three points. Why not get your feet outside the line? Or drive closer and nail an easier bucket?
So how would Apple price a tablet? Again, we're talking rumors here, and they're all over the map, but knowing Apple, it's going to be higher than the competition by a good margin. I'd guess less than the US$999 entry-level MacBook and higher than $500. A 64 GB iPod touch is already $399.
As for e-readers, the Barnes & Noble (NYSE: BKS) Nook is just $259, but the new Amazon (Nasdaq: AMZN) Kindle DX is $489, set to be released on Jan. 19. Samsung's CES-announced E6 and E101 come in at $399 and $699, respectively, and two new Plastic Logic's Que proReader units will go for about $649 (4 GB) and $799 (8 GB).
As for tablets announced at CES, there's the HP (NYSE: HPQ) tablet that will run Windows 7, support multitouch, and sport an accelerometer. It won't be out until summertime -- but it'll reportedly sell for less than $500. Meanwhile, come June 1, Lenovo should release its Ideapad U1 for less than $1,000.
What do all of these devices have in common? Big money.
As a consumer, I could buy a limited e-reader for a few hundred bucks or get something more useful for hundreds more. And it's this hundreds more that makes me pause.
How Can an Apple Tablet Be Worth the Cash?
My MacBook is an essential item. I need it to work, and it's fantastic for personal productivity and lifestyle applications -- movies, email, calendar, Web, television, photos, etc. No matter what, I need a MacBook.
My iPhone is also an essential item. I need it to work and play. Mobile action, always ready to go (except in New York and San Francisco). Gotta have a smartphone.
An iPod touch -- I've got one, as well as an iPod nano, and an iPod shuffle. They are all handy, but essential? Sort of. It's very nice to be able to load up an iPod touch with media and not have it connected to your phone. But if it broke, would I buy a new one? Probably not. Same goes for the handy workout-friendly nano and shuffle.
You can see where this is going.
At a low price, an e-reader or an "iPod slate" offers some nice functionality without a choke-on-it price. However, once the cost ramps up on the near side of four figures, I have a hard time imagining what will make me part with the dollars.
Perhaps it'll sport a webcam, as Orange France's Stephane Richard seemed to reply in an affirmation to a reporter's question. Perhaps it'll sport 3G access, as he also reportedly implied. Ubiquitous 3G access is great, but do I really need to be packing around an iPhone and a big tablet? Do I really need to video conference with anyone on the go?
Sure, I can see the need for bigger screen access to email and productivity applications if I traveled a lot for business, but I don't. And I can see a need for a bigger screen for gaming, but I can't see too many kids (or myself) getting an Apple tablet for gaming. Watching movies? I could use a bigger screen there, but again, pack a tablet and my iPhone?
Use it with a dock as a quasi-Apple TV? Or media extender device? Maybe. Sure. But why not just hook up a $599 Mac mini as a home theater PC and go that route?
What if it's an auto GPS unit, too? Cool, but still, between the desk and mobility, a tablet falls into non-essential land for me, and I suspect it will for many consumers, too.
Newspapers, Magazines, Texbooks and TV
There is one area that gets my attention, and it comes back to changing the "game," so to speak. What if the rumors that Apple has been talking to publishers are on track? What if Apple is trying to find a way to deliver newspaper and magazine content? What if Apple is trying to find a way to deliver TV as a subscription rather than its usual $1.99-per-episode method? What if Apple is looking to undercut the expensive textbook market and bundle tablets as part of a tuition/textbook deal at universities?
What if Apple found a way to subsidize the price of entry on a new tablet device by including some sort of subscription model? What if Apple takes a lesson from cellular service companies and offers something valuable with a two-year contract?
Might I subscribe to my local paper for two years rather go with a paper delivery? Might I tell my cable or satellite service provider to keep all their stupid channels I don't want and buy an a la carte subscription to shows I really want via a new Apple service?
Maybe.
What if it had a dock and a separate keyboard?
Maybe.
What if it is a svelte and glorious artifact of industrial design?
Nah.
But we'll see. Apple CEO Steve Jobs knows how to make a damn good pitch.
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