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Can the $599 Motorola Xoom Wi-Fi compete with the iPad 2?

Mar 17 2011, 8:04am CDT | by , in News | Tablets

Can the $599 Motorola Xoom Wi-Fi compete with the iPad 2?
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$599 Motorola Xoom Tablet ships on March 27th.

Motorola made the Wi-Fi Xoom Android Tablet official this week. The $599 Xoom will start shipping on March 27th. You can pre-order the Wi-Fi Xoom now on Amazon.

The Motorola Xoom has a 10.1-inch screen and a 1GHz dual-core NVIDIA Tegra processor. It offers 1GB of RAM and 32GB of storage. Other features of the Xoom include HDMI out, microSD card, 2MP camera, 5MP camera, Wireless-N and 10 hours of battery life. The Xoom is the first Tablet that runs Android 3.0 (Honeycomb).

With the iPad 2 out of stock the Xoom has a chance to find some buyers, or does it? The Wi-Fi Xoom is considered the entry-model. The 3G/4G version is $200 more expensive. Motorola argued that the Xoom is more expensive because it has faster download speeds with the 4G upgrade. This argument does not work for the Wi-Fi Xoom. Motorola is matching the price of the 32GB iPad with the Wi-Fi Xoom that has the same amount of storage. Why is Motorola not offering a 16GB Wi-Fi model. Or even better, selling the 32GB Xoom for $499. We are talking about attacking a dominating market leader here, just matching prices will not do much. Offering more for less money will start to get consumers considering a Xoom purchase. Especially when an iPad 2 is hard to find.

In my opinion the only path for Android Tablets to compete with the Apple iPad is over price. The analyst's predicting that Android tablets will have the biggest marketshare in two or 3 years time assume that things will play out like they did in the smartphone market. A major driver for the success of Android phones is the low price. You do not find Free iPhone deals with a contract in the United States, but you get plenty Android phones for $0 with a new contract.

As long as iPad competitors cost the same as the iPad or even more, Apple will continue to dominate. Apple managed to make it really hard to compete on price with the iPad. That is why we have not seen a $399 Tablet with specs comparable to the iPad. This is very different when comparing it to the PC and Laptop market where Apple competitors are able to offer the same performance for considerable less money.

I actually see the iPad future more aligned with how the iPod dominates the portable media player market. Carriers play a lesser role in selling tablets as Wi-Fi Tablets are a reasonable alternative. Especially with personal hotspot features becoming more common on smartphones. Paying more and having to get another contract for a tablet prevents the 3G tablet from being a choice for many.

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