Forbes’ “Brian Caufield asks the question if Apple has any future with the iPad given the potential for $99 tablets,” Horace Dediu writes for asymco.
“The question is indeed why not introduce an ultra-cheap tablet, for example from Amazon, which makes up for the low price with an innovative business model like selling content or user behavior data. After all, game consoles are sold this way. This is the classic razor/razor-blade business model,” Dediu writes.
The answer to ‘why not’ is actually not simply that the economics don’t work. They might work some day even if they really don’t today.”
“The answer to ‘why not’ is that the iPad is not good enough,” Dediu writes. “People will yearn and beg for more functionality and will drop the last generation for the next without hesitation. This pattern of breathless upgrades is symptomatic of a product racing up a trajectory of improvements which are relevant to buyers. So until buyers find the n+1 version of the iPad to be superfluous and over-specced, having too much battery life, too big a screen, too much storage and with more speed and bandwidth than needed, the iPad need not fear the low end.”
Read more in the full article – recommended – here.
[Thanks to MacDailyNews Reader “DAN K.” for the heads up.]
Related articles:
HP’s $99 TouchPad fire-sale burns Apple’s iPad foes – August 31, 2011
Why the undead $99 TouchPad might portend iPad’s doom – August 31, 2011
