Google’s Nexus 7 is the Gamebreaker in the Tablet Wars
Harsh is a member of The Motley Fool Blog Network -- entries represent the personal opinion of the blogger and are not formally edited.
Whenever any of the tech biggies release a new tablet, the first question that does the rounds is – “Will this be an iPad killer?” We saw this with Amazon’s (NASDAQ: AMZN) Kindle Fire, and with Microsoft’s (NASDAQ: MSFT) yet to be released Surface more recently. Now when search and software giant Google (NASDAQ: GOOG) decided to put its hand into the hardware hat and pulled out a tablet, the same old news of taking away Apple’s (NASDAQ: AAPL) market share in the tablet universe came into the spotlight once more. But this time, Google’s foray into hardware not only mounts a challenge for Apple, but also for Amazon and Microsoft.
A Fire Engine for the Fire
Manufactured by Asus, with a resolution of 1280x800 pixels, 1.3 GHz dual core processor, 1 GB RAM, a 1.2 megapixel camera and a starting price of $200, the Jelly Bean powered Nexus 7 tablet by Google stands head and shoulders above Amazon’s Kindle Fire. A quick run through the spec sheet will make most potential tablet buyers opt for Google’s offering, which begins shipping next month.
One of the most pertinent questions at this point of time would be, “Will Google’s tablet douse Kindle’s Fire?” And as far as I think, the answer should be a resounding yes. Google’s Nexus 7 has the potential to dethrone the Fire. The reasons? Quite simple.
Amazon had launched the Kindle at a break-even price of $199, with the aim of generating online sales through the tablets. It runs a scaled down version of the Android OS and comes up short on many points on the spec sheet against the Nexus 7. As a result, Google’s tablet would probably be the tablet of choice for those with $200 to spend on a tablet. Moreover, as far as online shopping from Amazon is concerned, you don’t need a Kindle Fire to place your order.
Amazon had done well to slip in behind Apple in the tablet race, but has been overtaken by Samsung since. It burned on cash to give away tablets at break-even, hoping to make money from selling merchandise online and bringing the fire down on the cost curve. But Google’s latest adventure undoubtedly throws a monkey wrench into Amazon’s plans. Once the Nexus 7 starts shipping and its sales figures start coming out, I won’t be surprised to see it selling more than Amazon, which is yet to update its relatively old Fire.
Challenging the iPad? Quite Possibly
Now as far as the iPad is concerned, it is unmatched in terms of what it offers. But it has seen its market share shrink over time as more and more Android powered tablets, which are cheaper than the iPad, flooded the market. Research firm IDC expects that Android tablets will race ahead of the iPad by 2015. Android tablets will be fine tuned and improvised device after device, getting better in the process, and will probably continue selling at cheap prices. And the Nexus 7 might prove to be the beginning of the change in the market dynamics with its impressive specs and juicy pricing.
But Apple has an ace up its sleeve in the form of the highly anticipated iPad mini, the iPad’s little brother. The iPad mini is supposed to be launched later in the year in the $250-$300 range and its success will probably cement Apple’s place as the leading tablet seller. How this war will fan out will be an indicator of things to come in the budget tablets category, but it will certainly be a close one.
From Surface to Sea
And finally, I think Microsoft’s Surface should better get back under the water since the Nexus 7 might run it down. Fool analyst Evan Niu has already told us why the Surface looks like a failure already. A probable price of $599 with specs which aren’t superior when stacked against the equivalent iPad and an untried Windows 8 OS are significant headwinds which Microsoft will need to navigate. And need I mention the iPad mini’s threat over here? The Surface isn’t going to be around for long under such circumstances.
The Takeaway
The Nexus 7 has opened to rave reviews. It brings freshness in the tablet wars and will change a few equations. Analysts will now bake in the Nexus’ prospects into their projections, and might rank it ahead of the Kindle Fire and the Surface. Google has launched an impressive product in a cut-throat market which could probably see it leave an indelible mark in the tablet wars, and bring down a few others. So get ready for the Nexus 7.
TechJunk13 has no positions in the stocks mentioned above. The Motley Fool owns shares of Apple, Amazon.com, Google, and Microsoft. Motley Fool newsletter services recommend Amazon.com, Apple, Google, and Microsoft. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.If you have questions about this post or the Fool’s blog network, click here for information.
