Apple knows what the future holds, and that future makes Apple quiver in fear. Somewhere in Washington, a band of Amazonians are methodically piecing together the ultimate iKiller, a tablet that will become the first legitimate threat to Apple’s dominance atop the tablet heap.
Amazon’s long-rumored tablet is apparently in its final stages. If a report written by TechCrunch’s MG Siegler is true, Amazon is on the verge of releasing a 7-inch Android-based tablet just in time for the holiday season. The tablet apparently looks similar to the BlackBerry Playbook, runs a custom OS forked from Android 2.2, has a single-core processor and no cameras. From a spec standpoint, it’s definitely nothing to get excited about. But within the context of a robust ecosystem an insanely undercut price, specifications begin to lose their luster.
Some may scoff at the single core processor and the lack of cameras and easily dismiss the tablet as a fail, a marketing ploy, an attempt to capitalize on retail. That would be incredibly shortsighted. We could digress into a lengthy discussion, debating the virtues of dual cores and cameras, but it would detract from one of the main things that gives Apple reason to shiver: Amazon’s wonderfully fully-featured ecosystem.
Apple’s approach holds several key advantages over other tablet manufacturers. Vertically integrated, Apple designs the tablets, the OS, curates the store and provides the services. This approach solidifies the iPad experience and warmly insulates users from the cold, cold world of fragmentation. Samsung isn’t so lucky. They design the tablet, but have to rely on Google for the OS and the store, and various other third parties for services. In at least one respect, Amazon will be learning from Apple’s strengths in order to slay the beast. Amazon’s Tablet will distinguish itself from other Android tablets in the sense that it will also pursue a walled-garden approach. The various services already offered by Amazon are fantastic, and they’ll only become better once they are optimized for their feature product. Case in point, If you navigate to Amazon’s home page and glance to the left, you’ll see the department heading. The first five departments might as well have TABLET written all over them: Unlimited Instant Videos, MP3s & Cloud Player, Amazon Cloud Drive, Kindle, and Appstore for Android. Within these departments, Amazon already has their answer to iTunes, iCloud and the App Store.
The option to stream music is going to be great, but the ability to stream video is going to be even better. Amazon Prime, included with the purchase of the tablet, allows access to streaming content*. With Prime, Amazon has a built-in, free service that allows customers to circumvent any superfluous Netflix charges.
Obviously, the key for Amazon will be sewing these services seamlessly into their tablet experience, and continuing to build out the ecosystem. Currently, Netflix has a larger catalog than Prime, and iCloud will have more functionality at launch than the Amazon cloud service. Amazon will need to work hard to make these competitive and compelling alternatives to Apple’s analogues.
A differentiated and well-rounded ecosystem is a necessity, but the knockout punch will be delivered by pricing. We’ve been conditioned to believe that $500 is a very reasonable price to spend on a tablet. If $500 is affordable, then $250 is a downright impulse buy for gadgeteers, and an attractive option for the general consumer. This will translate favorably to sales, sales that will serve as a detriment to the iPad. Still, some would argue that the iPad and the Amazon tablet are in two separate categories, that 7-inch doesn’t necessarily compete with 9.7-inch. The truth, however, is that if the average consumer buys a 7-inch tablet, they aren’t going to spring for a 9.7-inch tablet as well.
Perhaps the best indicator of the Tablet’s future lies in the Kindle’s present. Amazon has marketed it vigorously. They attacked the iPad in advertisements and pushed hard to establish it as the world’s most popular e-reader. Go to the Amazon.com home page and see what occupies the pedestal. King Kindle, front and center. It’s their best selling product, not because it’s the only product of its category, or because it does something magical, but because Amazon put their weight behind it, promoted it, developed its ecosystem and sold it. And they’re going to do the same with the forthcoming tablet. Apple, this might be the time to consider building a more affordable tweener.
And by the way, the name of the new tablet? The Kindle.
*As well as free 2-Day shipping on all orders.