The Amazon tablet, expected to arrive Wednesday, doesn't have anyone at Apple scared, and it shouldn't. It's Barnes & Noble, Samsung, and Acer who should be quaking in their boots. That's because Amazon's tablet aims to be to the 7-inch tablet market what the iPad is to the 10-inch market. Those two categories can coexist just fine, but Amazon's competitors are going to have to pedal hard to keep Amazon from sucking all of the air out of the 7-inch room.
The tablet market is embryonic. It looks like everyone has an iPad, but that's nowhere near true. I'm not going to get into the details of analysts' predictions, because they're all just guesses, but everyone is at least guessing in the same direction: in the next few years, the tablet market will be several times the size it is now.
As markets get larger, they segment. We've seen this in every product category, and we'll see it in tablets, too. The 7-inch tablet segment is the most obvious, and various manufacturers have been hammering at it for a while. The first "real iPad competitor," after all, was seven inches: the Samsung Galaxy Tab. Seven-inch tablets can be used one-handed, making them qualitatively different from 10-inch tablets. They're also, often, cheaper.
Why 7-Inch Tablets Have Failed
But 7-inch tablets haven't taken off, not because the size isn't appealing, but because they haven't gotten their experience in order. Android Gingerbread-based tablets have an unappealing interface. Honeycomb-based tablets have relatively few great apps. The most successful model so far has been Barnes & Noble's Nook Color, which holds the user's hand and explains what you're supposed to do with the thing (read books.)
Apple does the same thing. Its iPad ad campaign is brilliant, because it's largely 30-second how-tos: here's the tablet, here's exactly what you do with it. Samsung never communicated so clearly with the Galaxy Tab, and have you even seen an Acer tablet ad? The Acer A100 is a great little device, but it has zero consumer visibility.
This is Amazon's opportunity. Like Apple, Amazon understands that you have to sell the full experience. That understanding has been missing from Android tablets so far, which sell the experience up until you turn the darn thing on, and then leave the rest to Google. Google then drops the ball while trying to pass it to third-party developers.
Of course, the Amazon tablet's success rides on Amazon delivering a great experience, but all this speculation is boring if Amazon puts out, say, a rebranded Pandigital Novel. It's best to imagine that Amazon's product won't suck.
At $250, a 7-inch Amazon tablet scratches an itch that the $500-$850 iPad can't reach. It's a better size and cost for kids. It's a better size and cost for reading while standing up. Heck, it's a better size and cost for these recessionary times in which we live. I actually see the Amazon tablet leading to two-tablet households. The iPad, after all, isn't actually all that portable. It's the perfect around-the-house tablet. The Amazon tablet will be the perfect tablet to take out.
Yes, You'll Own Two Tablets
Can Americans afford two tablets? Come on. Plenty can afford two TVs, two PCs, and two smartphones - or more! - per household. While Amazon's tablet will cannibalize some existing markets, it will be part of a domino effect killing low-end laptops, it'll displace some iPod touches, and it'll aid in the continuing iPad-fueled demise of small secondary TVs. The better question is, will Amazon's tablet bring unique value that existing tablets don't fulfill, helping the 7-inch, low-cost tablet category to break through?
I think so. I think the Nook Color has shown so. Amazon's tablet could be a Nook Color with much better content - more apps through Amazon's app store, music, video, and such. Like Barnes & Noble, Amazon is holding users' hands and not leaving them to the whims of the poorly designed Android Market, but Amazon has a lot more content than Barnes & Noble does. The tablet will still fit well in one hand, be affordable and offer a terrific reading experience, all things that will differentiate it from the iPad.
This could make Amazon's tablet a killer. Just not an iPad killer.
For more, see "12 Big Questions About the Amazon Tablet" and the "What the Amazon Tablet Needs to Succeed" slideshow below.