There's been some interesting developments in the field of tablets over the last couple of weeks. It started with HP's decision to pull their TouchPad tablet only weeks after releasing it. After deciding to remove it from sale they authorised sellers to slash the prices and it caused a buying frenzy, to the point there were websites/pages set up just to monitor where still had stock. In the UK, where it went on sale a bit later, there were stories of people buying 100s at £89 (from an RRP of £399-£559) and reselling them on eBay at £150 a time and still selling out in hours if not minutes.
Many bloggers and news sources stated it as evidence that there is massive demand for a cheap tablet. Everyone said that if a manufacturer could get a tablet to market at cost, or even below cost and subsidise it in some way, they'd have a runaway hit. I'm not sure that's strictly the case. There are already plenty of tablets on the market for £50-£200 but they haven't been selling in large quantities. The thought is this is because they don't come from a known brand.
I suspect that, if you looked at who was buying the defunct TouchPad, you would overwhelmingly find it was people in the tech industry, not your average consumer. Maybe that doesn't matter, but I don't think the market as a whole can be predicted by what happened with the TouchPad. It does, perhaps, show that cost is certainly a big factor and that there is demand for a dead simple tablet in the $200/£200 range, something like what TechCrunch originally proposed.
In steps Amazon with a rumoured tablet that everyone is starting to pin their hopes on. Turns out we were probably wrong to do so, because while we've been calling it a tablet, Amazon simple call it a Kindle. Reading that article, which describes their upcoming (if you believe the article) 7" tablet, it becomes obvious this isn't something designed as a general-purpose tablet like the iPad. This seems to be aimed at providing a platform for Amazon's media offerings, ebooks included, but in the US they also offer services like their cloud music player and streaming videos (not in the UK as yet, though they have bought Lovefilm). They're also launching their own app store, which Apple can tell you is a profit stream not to be sniffed at. I suspect this Kindle will be US-only at launch.
When you start to look at the device though, it disappoints. It runs a custom version of Android, good for Amazon, but it means no future upgrades (not necessarily a bad thing); it's 7" where the most popular size is 10" (like the iPad); it supposedly runs a single-core chip, making it slow compared to other tablets and while it's referred to as a Kindle, Amazon has made a point of differentiating the existing Kindle by pointing out the e-ink screen is better for reading, its battery life is substantial and it's lighter than an iPad. Not to mention it's cheaper.
The new Kindle (I'm guessing a name like Kindle+ or Kindle Media) has an LCD screen, which isn't great for reading (resolution too low, reflections) and adds weight (being 7" will help) and reduces battery life. If the rumoured price ($250) is somewhere near accurate then they've kept the price down, but they can make it up by selling media for the devices, the old razors and razor blades approach.
The disappointment comes from the fact that Amazon is one of the few companies who could threaten Apple. They're one of the few with the size, branding and existing media channels to supply content to a tablet. What I wanted to see was a 10" stripped down tablet at a rock bottom price that integrated with their online stores, including the app store, and could offer the first serious contender to the iPad. I've said before that other tablet makers should get onboard with Amazon to deliver content and with Amazon releasing their own devices I thought they may make some inroads on Apple (they may still, rumour is a 10" may come in 2012). I'm not the only one either. The contender everyone seems to have forgotten is Microsoft (see below).
The fact that Apple are suing Samsung left, right and centre to stop the Galaxy Tab suggests the device might be the first real contender to their throne. Obviously it won't make a major dent, but it may be enough for it to claim second place as we start to see the runners and riders fall into place in the tablet market.
Late for the party again they may be, but this is not the time to count them out. Windows 8 looks like it might have some potential as a tablet OS (jury's still out) and with Xbox Live they have a content delivery network to support tablets (Sony has much of this in place too, but they screw the pooch so often when it comes to consumers I don't think they'll do well, they'll be too busy trying to protect Blu-ray to commit in force). I suspect Microsoft will start a slow renaming process with Windows 8's launch, to lose the Xbox part of Xbox Live.
I also wonder if, for the first time, Microsoft start dictating the hardware specs to OEMs when it comes to tablets. The last thing they want is a buggy experience. They're already late, they may only get the one chance. Though the devices will look vastly different, I wonder if they'll all feature the same chipsets in an effort to make it stable. An Xbox is basically a PC with fixed hardware that enables developers to write for it knowing they won't have to worry about incompatible graphics cards, drivers or conflicts. Why not do the same with tablets to ensure a stable, fast experience for the end user? That's basically how Apple ensure it.
So, there are still plenty of dice to be thrown in the tablet games, but I don't think Apple will feel threatened. They'll sit on the iPad 3 for a while until they're competitors look like they're gaining ground (early next year, they'll probably announce around the time Windows 8 starts to appear) and then, boom, out of sight again and everyone else gets to play catch-up.