$100 Tablet – lose lose

 

 

 

 

 

  • The notion of a tablet that costs $100 may sound exciting but those that rush out to purchase the device are likely to quickly discover that you get what you pay for. (i.e. not much)
  • Details of a Nexus tablet from Google at $99 have continually surfaced from Asia which combined with Google’s event scheduled for October 29th makes it seem likely that this device just may be on the shelves in November.
  • In this age of austerity and empty pockets its sounds ideal but then what use is a tablet that doesn’t really do what you want it to?
  • In order to make this price point (and not lose a fortune) one has to cut corners everywhere.
  • The screen will have to be low resolution in order to keep it cheap as well as not place too many demands on a low-end processor that will already be stretched to the limit.
  • The rumour mill has the processor as a WonderMedia PRIZM 8950 delivering a relatively puny (for this day and age) 800Mhz tied with a Mali GPU.
  • This is going to seriously hamper performance and you can bet that there will be grumpy faces as the angry birds fly jerkily towards the targets at a glacial pace.
  • So what is a $100 tablet all about?
  • Probably the same as the $49 Android phone that I heard about the other day.
  • It is about getting a device in the hand of an anxious user at a price that he can afford.
  • I suspect that these first time buyers care more about being able to put their hunk of plastic, glass and metal on the table to ensure that all and sundry can see that they have the means to join the post PC world.
  • This is an important factor particularly in many emerging markets.
  • It is not so much about being able to that much with the device but when they try there is risk.
  • I can see users becoming negatively disposed towards Android as the hardware limits the user experience.
  • In 2 or 3 years’ time, the story is likely to be much different as usability will be a much bigger factor in the user’s purchase decision when they come to considering a replacement.
  • I think that this is the same for both tablets and handsets and is at this point that we may see the mid-range names such as HTC and LGE finally enjoy some recovery.
  • However, for now the outlook remains bleak I would not go near either of them.
  • For this tablet in itself, it runs the risk of negatively disposing users towards Android, taking sales from higher priced, better performing alternatives and damaging the Nexus brand.
  • Good for total volumes but bad for Android and long term bad for Google as users could seek alternatives after a rotten experience due to hardware, but blamed on software.
  • Apple won’t be losing any sleep over this.

 

RICHARD WINDSOR

Richard is founder, owner of research company, Radio Free Mobile. He has 16 years of experience working in sell side equity research. During his 11 year tenure at Nomura Securities, he focused on the equity coverage of the Global Technology sector.

Blog Comments

A $100 tablet might be OK for my 18 month old daughter. It would stop her demanding my wife’s iPhone so much.

Android has always been about a race to the bottom. The Android hardware vendors expect you to upgrade your OS by buying a new unit. Classic consumer electronics vendor behaviour.

how else are they going to make any money?…. kill the hardware upgrade game and you are out of business!

Exactly. A race to the bottom on declining margins.