Researchers: Google’s tablet can beat the Kindle Fire

by Doug Drinkwater

June 27 2012

Google's first own-brand tablet is expected to sell for between $199 and $249
Google's first own-brand tablet is expected to sell for between $199 and $249

Google looks set to announce its own-brand Nexus tablet at the I/O developer conference in San Francisco later today, so with that in mind, TabTimes sought the views of research analysts on what the Nexus 7 could mean for the search giant, the tablet market and for Apple.

Google’s tablet can beat the Kindle Fire

“The key thing about the Google tablet is the pricing”, said Informa’s principal analyst, Dave McQueen, when speaking to TabTimes. “If they price it far enough away from the iPad and get the user experience right, then I think it can be better than the Kindle Fire.”

TabTimes asked McQueen on what Google’s strategy will be for the tablet, and the Informa analyst believes that Google may be using the device simply as another tool to ‘get more eyes’ on Google and its services.

“Amazon has its own content and online store, but Google doesn’t have that, it has search and advertising. I think the Google tablet will be another way to get more eyes on its assets”.

But the price is irrelevant and questions remain over Google’s strategy

Not everyone is convinced by a $199 Google tablet however, with ABI Research analyst Jeff Orr adamant that pricing is currently irrelevant in a nascent tablet market, and further bemused as to why Google is even taking the decision to launch its own hardware.

“I am challenged by seeing a value for Google offering hardware platforms. If there was a lack of device OEMs adopting its OS and content ecosystems, I could see the value to the market as a form of stimulus and leading by example, like Amazon.

“But having the OS supplier also in the hardware business while trying to nurture a vendor/partner ecosystem often results in confusion if the supply chain is a friend of foe”.

Orr also believes that the Nexus 7’s price point of $199 is irrelevant, and says that price is not a barrier to tablet adoption.

“A $199 price point for a tablet is still early for the market. The total available market (TAM – those willing and able to buy now) has yet to move beyond early adopters, and this can observed with the 7-inch Asus Transformer at $249. Asus and Nvidia worked hard to come out with that price for a quad-core tablet in January and the fallacy there was a belief that price was the major barrier to adoption.

“When ABI Research surveys consumers in different countries, the leading hesitation is justifying an additional device. Tablets will be incremental, helper devices for the foreseeable future.”

A cheap Google tablet could make Apple’s iPad more attractive

Context mobile analyst Salman Chaudhry thinks Google will face a tough fight against the Kindle Fire, and even suggests that the Nexus 7 faces little chance of being able to eat into the Kindle Fire’s market share.

“If Google is looking to take a bite out of Amazon’s share, it will find that it’s competing against a much more well-developed entertainment orientated platform with a huge, well organized catalogues of books and media content.”

In fact, the Context analyst argues that the budget nature of the Nexus tablet might even play right into Apple’s hands, by making the iPad look more attractive.

“From a brand perspective, a launch into the sub-$199 demographic would suggest that the tablet is not top-end/ cutting edge technology”, stated Chaudhry.

“This might make the iPad even more desirable in the consumer's eyes.”

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