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said Toshiba's Casper. "A Windows 7 tablet is a PC, right? And
you've got full access to all of the applications that are on a PC,
so having an app store isn't necessarily an issue."
3G vs. Wi-Fi
Last year when you walkedinto a carrier store, Best Buy or Radio
Shack, you probably saw at least one or two netbooks with built-
in mobile broadband being dangled for $99 or less. The catch?
A $59-per-month data plan and two-year contract, ballooning
the price tag of that "low-cost" mini-laptop above $1,500. As you
might expect, most consumers didn't bite, deciding instead to
stick with Wi-Fi-only netbooks that start at $299.
"Carriers have to realize that the world is changing,"
said Don McGuire, go to market lead, Dell Communications
Solutions Group. "People are not going to pay $60 per rate
plan for seven different devices. It's not going to happen."
McGuire says that Europe is much further along than the U.S.
when it comes to thinking outside of the traditional subsidy
AT&T took a risk with the Wi-Fi + 3G version of the iPad
by deciding not to discount the hardware. However, while the
tablet itself costs a relatively steep $629, the data plan is $25
for 2GB per month. Plus, you don't have to sign a contract; you
just turn the data on when you want to and pay for that month's
service. Still, that higher starting price didn't help sales; AT&T
reported that it sold a mere 500,000 3G iPads through the
end of the second quarter. Ultimately, carriers will have to be
even more flexible if they want tablet shoppers to pay for the
convenience of mobile broadband.
"All of us are trying to figure out what's the right price point,
what's the usage, and how often are users connecting," said
Sprint'sOwens, one of four carriers selling Samsung's Galaxy
Tab. This broadened menu of options will include session-
based pricing, including daily and weekly passes. You'll also
likely see bundling offers with mobile hotspots such as the
Overdrive, as well as with phones that have mobile hotspot
apps. "People will make the decision for that $30 per month,
Do I want to make that attachable where it can power my tablet,
my camcorder, and all the things that are Wi-Fi enabled? There
will be more of a mainstream need to have a mobile hotspot,"
As carriers and tablet makers continue to solve this puzzle,
Wi-Fi-only tablets will predominate in the short term. However,
slates with mobile broadband baked in should eventually take
off. "As the cost of the hardware starts coming down and next-
generation 4G networks start to expand, having that capability is
going to be more attractive over time," said Toshiba's Casper.
The Future of Computing
When you think about everything a tablet can do today, it's
no surprise that an increasing number of workers are leaving
their laptops behind. "People are now walking into meetings
with tablets. And the portability of tablets makes it a big op-
portunity," said Owens. "I see it being a prosumer tool. I can
use it for productivity, and I keep it with me for the entertain-
ment side of it. It's become a substitute for my phone as well
as my PC."
On the other hand, with their more powerful processors,
physical keyboards, and gobs of onboard storage, traditional
notebooks are much better for creating rather than consuming
content. In other words, the death of the PC has been greatly
exaggerated. "We see a rush of early adopters and the curious
buying an incremental device that they wouldn't have bought
otherwise, because it's cool," said Stephen Baker, vice president
of industry analysis for NPD.
The truth about tablets really lies somewhere in the middle.
The iPad isn't just cool. It has changed the way consumers
and other big consumer electronics players think about what
computers are and what they can do. And while they don't
pose an immediate threat to laptops, over time tablets will
gain capabilities that will cause some to think twice about
whether they need to tote that clamshell. Because the market
is still so new, there's plenty of opportunity for the category
to evolve in multiple directions. And that includes players
other than Apple.
"I think the opportunity that Microsoft and others still
have in the tablet market is that these devices that have been
so popular of late are really consumption devices," said Al-
exander. "I think there is still room for a lot of competition in
creation-focused devices. Tablet makers are coming out with
competitive products much more quickly."
HP'S BIG webOS GAMBLE
Just in case there was any confusion about where HP stood on
Android, this September the company launched its first tablet
based on Google's OS---as an accessory to a printer. Instead,
HP is putting its full weight behind webOS, a platform the
leading PC maker acquired along with Palm back in April. As of
press time, not much was known about this mystery slate---
expected to launch in the first quarter of next year---other than
the fact that PalmPad name is now trademarked.
Will the combination
of HP and Palm produce
get excited about or will it get a lukewarm reception like Palm's
webOS phones? Some analysts see serious potential. "Its ease
of development could help developers more quickly optimize
for the new device size, one of the key issues facing Android,"
said Ross Rubin, executive director of industry analysis at NPD.
He also believes that HP's brand and distribution are invalu-
Palm argues that many of webOS' strengths will translate
well from phones to tablets, especially multitasking. "You can
keep the different apps in the states that they are in and move
between them seamlessly. I think that is a huge thing to look
at," said Tim Pettit, Palm's senior product manager for smart
phones. Palm's upcoming webOS 2.0, which is hitting phones
first, could take multitasking to the next level. For example,
Stacks automatically sorts related active apps into groups.
Another cool feature, called Exhibition, will enable webOS
devices to display certain information (such as news and
weather) when a device is docked in the company's inductive
Although Palm knows that it still has a lot of work to do,
the company is confident that it can deliver the level of quality
shoppers are looking for. "Today when you go to Fandango, if
you buy a ticket we will put it into your calendar," said Pettit. "It
is that deep integration that I think a lot of people want."
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