I'll get right on it Rick. I think it is about differentiation, especially when all other things are equal. Why has the Samsung Galaxy S4 outsold the HTC One? Brand is important, but differentiation is critical not only to sway the consumer purchasing decision to ones products, but also to convince consumers that they should upgrade to a new device. I guess I have a few more blogs to write over the weekend.
I'm not sure why my previous post is not in chain, but let me repeat some of it.
First, Intel did announce $99 tablets, but they will not have the Bay Trail processor. They will likely feature the older Clover Trail SoC. The tablets with the Bay Trail SoC will begin at the same $199 price point. While the Intel solutions are impressive, I thought the Android version, which will not be in the initial wave of Bay Trail tablets, was the most impressive. However, the OEMs introducing Bay Trail seem focused on differentiating around Win8.1, which still falls short of the Android tablets.
Second, there is the issue of competing against customers, but this exists throughout the entire electronics value chain today because of the vertical integration model that Apple has pioneered so successfully. As a result, competing against ones customers is almost inevitable in today's electronics market. But, it is imperative that all companies continue to explore all business models. Only time will tell which companies and business models will survive. For the Tegra Note, NVIDIA is partnering with smaller local partners including EVGA and PNY Technologies in North America; EVGA, Oyster, and ZOTAC in Europe; Colorful, Shenzhen Homecare Technology and ZOTAC in Asia; and XOLO in India.
In regard to the broader segment, I think that the $199 tablet area is going to be highly competitive this holiday season. If price is relatively the same, the brand and the user experience are likely to be the key factors driving the purchasing decision of consumers. And in regard to the user experience, especially for younger consumers, it is all about what you can do that you couldn't do before. In this respect, UIs and applications like computational photography are likely to be important features.
However, I look forward to all the new product coming out this holiday season because rather than being the same device in a similar package, we are seeing the value chain from the technology vendors through the OEMs focus on differentiation through features and applications. Just as in PCs, raw performance will only get you to the table; it typically won't make the purchasing decision.
So, I'll just speculate here that Nvidia isn't getting the killer tablet designs it wants and is really unhappy with the kinds of designs its tablet OEMs are making. Why else would it want to take a hit on the margins of its chips to make lower margin systems?
I note Qualcomm's Snapdragon was used in the Nexus 7 made by Asus and sold by Google.
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