In terms of manufacturing, the age of tablets is different from the age of netbooks mostly because there is no way to make a cheap tablet. You only have a certain, finite amount of space inside a small tablet case and, more important, tablet PC parts are expensive and often custom-built. Touchscreens are expensive because mother-glass manufacturers see Apple buying up their stock and they hope to make a killing. Flash memory is expensive because, well, Apple bought it all. And the tablets themselves are expensive because Apple set the prices. If Motorola could have gotten the Xoom below $250 I’m sure they would have but, given that there is a more popular alternative out there that costs twice as much, playing a scorched-earth pricing game would leave money on the table.
But manufacturers can’t “beat” the iPad because they’re still playing by netbook rules. As Stephen Elop said, there will soon be “200 tablets” on the market and only one clear winner. But hardware manufacturers are like sharks – they can’t sit still. They need to produce products constantly, no matter the popularity, and as a result, on the aggregate, no one device they produce out of the other 199 can touch the reigning king. It may sound hyperbolic but it’s true. However, they’ve been surprisingly reticent to produce many tablets. I’ve heard it said over and over: “If RIM had released the Playbook a year earlier, they would have owned the space.” Instead they announced early and hemmed and hawed and then released a device that is potentially superior to the iPad but, in practice, little more than a smooshed out Blackberry smartphone.
Nice insight from the supply chain side.
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