Monday, 14 March 2011 09:06

As The Tablet Margin Crunching Parade Marches On, Consumers Benefit From The Cheapest Prices Of The Best Products

If BoomBustBloggers remember, I recommended that tablet purchases be held off for a quarter or two while the vendors slug it out in margin and technology battle to the near death. Well, Apple came out with its sleek, sexy (although incremental) iPad 2, with lines forming around the block in major urban area stores.

A quick note before you go through these videos. As I searched YouTube for videos to post, Apple made it very easy by creating an iPad 2 channel, complete with a whole portfolio of fully produced videos. It created quite the impression and was easy to use in an attractive interface to show the features of the new product. Of course, this does absolutely nothing to make the iPad 2 a better product but it does go to show how Apple easily outmarkets its competition. What I find incredible is that creating a YouTube channel is not only child's play, but is necessary in this age of social media, web video and viral marketing. Soooo... What the hell is wrong with everybody else? This is not Apple executing as a superior company, its a case of everybody conducting their marketing campaigns as dimwits thus allowing Apple to run away with the show.  Case in point, the new Samsung tab is quite slick. It is thicker than the iPad 2, but also more capable from a tech perspective and through the Google software suites, slick as hell from the soft side as well. Of course, very few will know this because Samsung doesn't seem to have a Tab channel on YouTube, but Apple does.  The Apple iPad2 channel has over 2 million views already! This is naught but a wasted opportunity for all of its competitors and the implementation of such is simply common sense. No wonder why Apple has such a lead...

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Here we have the Motorola Xoom, released a few weeks ago with beta software to steal mindshare from Apple's iPad 2 release. It is a very fast machine, overclockable to 1.5 Ghz. For non-techies, that means fast as hell for a handheld device - the fastest to date.

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Panasonic tablets with wireless media sharing via Panasonic flatscreens. Whoever is impressed by this, or Apple Airplay, or any similar tech should realize that that the vast majority of media sharing services are already available for free on most Windows, Apple, android and iOS UPnP™ and DLNA®-certified devices - which is most of them. Then again, nothing like reinventing the wheel and marketing it as a sportscar, right?. I must admit that Panasonic has extended this a little, though. I wrote in January, If You Need More Proof Of Apple’s Inability To Keep Up With Google’s Android & Over 100 Other Android Hardware Vendors…- explaining that the sheer technological weight and might of all of these companies innovating full steam, and in real time will rapidly overcome Apple. Well, check out the future of the TV remote control.

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And it finally looks like RIM is going to release the Blackberry Playbook. I have lost faith in this company's management in this new touchscreen era. They don't seem to get it, not does their stuff come across as sexy or capable as the new crop of iOS or Honeycomb products, but you never know.

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Samsung has admitted publicly that they will drop the pricing on their 10.1 inch tablet for they don't feel it is competitive enough with the iPad 2. Many took that as meaning the Tab would be inferior to the iPad 2, but after looking at the video below it becomes apparent that Samsung's goal is to absolutely outdo the iPad 2, not simply match it. Inadequate is definititely not an adhective to be used with this device.

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An interesting comparison of a (now, remember admonitions about margin compression) $190 Nook Color (or $290 customized as is) vs the $400 iPad 1. Guess which is faster?

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Keep in mind that most of these competing tablet products haven't been released yet, and they are just the JV team - not the heavy hitters. In a few months you will see even harder hitting tech at a fraction of the current prices, and these prices are actually dropping in real time.

On a side note, the Microsoft Kinnect has sold over 10 million units, making it by far the fastest selling retail consumer electronics device in the history of the industry. It is being hacked to perform all types of functions from replacing a mouse to creating CGI characters, ala Smeigel (from Lord of the Rings) style. Remember, don't count Microsoft out just yet.

More on this topic:

  1. The Tablet Pricing Wars Have Commenced, Targeting Apple’s iPad 2 Which Is Not Even For Sale Yet…
  2. Steve Jobs Calls End Of the PC, We Call The End Of The Fat Margin Tablet – Including The Pretty iPad, With Proof!
  3. The Potential Equity Investments Most Likely To Prosper From the Google/Apple/Microsoft Mobile Computing Battle
  4. One Reason Why Software Developers & Tech Firms Should Pay Close Attention To Research Boutiques Such As BoomBustBlog
  5. Comscore’s Latest Stats Show Android Wiping The Floor With Its Competition, Besting Apple & Everyone Else By Ever Greater Margins
  6. Microsoft Finally Making Smart Moves – Is It Too Little Too Late, Though? Here’s How To Make Money Regardless
  7. The Tablet Competition Gets Serious For Business: IBM Lenovo Full-powered Windows Tablet w/Keyboard & 24hr Battery Life
  8. The Nokia/Microsoft Alliance & Android’s Commoditization Of The Mobile Computing Platform…
  9. Apple Gears Up To Combat The Margin Compression That Apparently Only It, Google & Reggie Middleton Sees Coming
  10. The Best CEO Memo That I Have Ever Read…

Monetizing the Mobile Computing Race

We have a pretty firm idea of who is in the pole position as of now, but that position is both risky and volatile, not to mention medium to long term in nature – see Navigating BoomBustBlog Subscription Material To Find The Google Valuation Drilldown.

A more risk averse strategy is to go long on the component vendors who supply those battling for pole position. Last week we released the documentFile Icon Long candidate #1 – Hardware: The Mobile Computing Wars to subscribers that outlined who our number one pick was after an initial scan. This is not necessarily the absolute final say on the matter since we have yet to perform a full forensic analysis, but the company does look good in comparison to over 120 peers. Non-subscribers should reference The Potential Equity Investments Most Likely To Prosper From the Google/Apple/Microsoft Mobile Computing Battle.

I am releasing the draft of the full shortlist of prospective long candidates as of now (17 pages, 5 companies) to subscribers. Please be aware that is a draft document and work in progress, but it is quite informative nonetheless.  See File IconMobile Computing Vendor Long List Note WIP. Those who wish to subscribe should click here.

Click here to read up on all of Reggie Middleton’s Mobile Computing War opinion, analysis, and research.

Last modified on Monday, 14 March 2011 09:40


  • Comment Link apeakunderthehood Tuesday, 15 March 2011 00:03 posted by apeakunderthehood

    Europe Enters Unorganized Chaos

  • Comment Link Reggie Middleton Monday, 14 March 2011 12:08 posted by Reggie Middleton

    The link seems to be working fine. Email any error that you get to customer support.

    As for Samsung, we don't know if they are trading profitability for share, because Samsung is able to internally source most of its expensive components - CPU, screen, etc. In addition, they sell much of the same components to their competitors, namely Apple - see the Apple margin compression blog posts for who makes the A5 chip. Samsung can potentially use Apple's success to fund their underpriced foray into the Tablet market with superior components.

    Secondly, this is a paradigm shift and its a major one. Short term profitability is a small price to pay to become the next Microsoft, with the attending entrenched and nigh unmovable installed base.

  • Comment Link Rumi Monday, 14 March 2011 11:35 posted by Rumi


    The link to the "Mobile Computing Vendor Long List Note WIP" doesn't work.

    As for the Samsung--it looks sleek, but I don't see how trading market share for profitibility is a good strategy. Sure, it makes AAPL a better short, but I don't think this is sustainable.

    Having said that, I never really understood tech very well.

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