Hugh Pickens writes writes "James Kendrick writes that after Apple introduced the iPad, companies shifted gears to go after this undiscovered new tablet market but in spite of the number of players in tablets, no company has discovered the magic bullet to knock the iPad off the top of the tablet heap. 'What's happening to the 7-inch tablet market is what happened to the PC market several times. Big name desktop PC OEMs, realizing that consumers didn't care about megahertz and megabytes — yes, that long ago — turned to a price war in order to keep sales buoyant,' writes Adrian Kingsley-Hughes. 'Price becomes the differentiating factor, and this in turns competition into a race to the bottom.' Historically, when a race to the bottom is dictated by the market, it's more a sign of a lack of a market in general. If enough buyers aren't willing to pay enough for a product to make producers a profit, the market is just not sufficient. Price is a metric that most people know and understand because it's nowhere as ethereal or complicated as CPU power or screen resolution. Given a $199 tablet next to another for $299, the $100 difference in the price tag will catch the eye before anything else. But if price is such an important metric, why is the iPad — with its premium price tag — so popular? Simple, it was the first tablet to go mass market, and cumulative sales of around 85 million gives the iPad credibility in the eye on potential buyers. 'So the problem with the Kindle Fire — and the Nexus 7 — is the same problem that's plagued the PC industry. Deep and extreme price cuts give the makers no wriggle room to innovate,' writes Kingsley-Hughes. 'By driving prices down to this level so rapidly, both Amazon and Google have irrevocably harmed the tablet market by creating unrealistic price expectations.'"
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