This whole frenzy over a $100 tablet is really a lesson for the whole industry and don’t think that Google (plus Motorola) aren’t watching this and plotting their next move. Fundamentally, the ability to get a $100 tablet based web browser is a huge draw. Call it what it is because no one is buying a TouchPad for its extensive app catalogue. There’s really a single draw to it (aside from the tinkerer/techies out there) and that’s a simple tablet with HTML5 plus Flash for freaking $100. And that’s why I’m two deep, hopefully going on three. I expect nothing more or less from it than the ability to browse the web, play a few videos and the like and I’m ok that it’s just a polished Chromiun tablet.
But I’m not alone here. Google gets this too and by having Motorola under its wing they can do something really significant and game changing here. They can release a tablet with mediocre specs that at least hit the TouchPad expectations and unlike anyone else in the industry they don’t need to make a dime off the hardware. In fact, if they break even or even lose a few bucks they’d be fine with that. Never lose site of the fact that Google is looking to serve you ads and if they break even on the hardware but gain on ads that’s a net win for them so game on. And that means that if they can put together a tablet where the components hit this $100 mark then expect it to hit the market seriously hard. So hard it will market itself just like this Touchpad frenzy. At $100 it’s such a small investment and people expect so little that it’s hard to not meet those expectations. And that’s a net win. The end result is that Google perpetuates its ad services and end users get a tablet web browser – not a replacement PC but everyone knows that going into it. In fact, if it runs Android instead of Chromium and has fancy apps and all then it’s just a cherry on top.
Jimski made a great analogy to the razor industry noting that Gillette has no problem giving away razors in exchange for blades that have 300% markups on them. Same thing here.
So my prediction – within one year Motogoo will release a low end tablet with a $100 price point (I’m calling it the Toggle – tablet+Google but I’m willing to negotiate that) and that tablet will become the top selling tablet. Don’t confuse that with the best tablet out. They’re totally different metrics. But it will sell like a mother…uhm sell like TouchPads on a fire sale. Don’t worry iPad users- these things aren’t going after the same base and it’s still an inferior product but a single device at such a low price point will impact the market so be prepared.