Google's 7-inch Android tablet should be $149, not $199

Price trumps specification, and this is why I think that Google should shave the spec in order to bring the price down to a more competitive $149.

Rumors are circulating that Google, in association with ASUS, is preparing to unveil a 7-inch Android-powered tablet called the Nexus 7 at this week's Google I/O Conference. If this tablet is to be a success, Google needs to get the price right.

According to the rumors, the tablet will be powered by a 1.3Ghz quad-core Nvidia Tegra 3 processor, with a 12-core Nvidia GeForce graphics processor unit powering a 1280×800 IPS display and 1GB of RAM. The rumored tablet will come in two storage options at two price points, 8GB for $199 and 16GB for $249. The operating system is rumored to be Android 4.1 'Jelly Bean,' about which we know very little.

On paper, the Nexus 7 spec -- assuming they are correct -- look good and gives it a significant advantage over other tablets in a similar price bracket, such as Amazon's Kindle Fire and Barnes & Noble's NOOK tablet.

But the problem is the price puts the tablet in the same category as the Amazon Kindle Fire, currently the bestselling Android tablet by a significant margin, owning over 54 percent of the market. Given that the Kindle Fire isn't the only Android tablet with a $199 price tag, Amazon clearly has the secret sauce required to essentially annihilate the competition. Part of that secret sauce is undoubtedly the price, but the Amazon brand, combined with the popularity of the Kindle platform, has undoubtly played a significant part in the success of this tablet.

One factor that doesn't seems to play much of a part in the success or failure of tablets seems to be the hardware specification. I've seen high-spec tablets vanish into obscurity while other, not-so-high-speced tablets have flourished.

Price trumps specification, and this is why I believe that Google needs to shave the spec in order to bring the price down from $199 to a more competitive $149.

Could Google do this? Of course it could.

Drop the Tegra 3 silicon in favor of a dual-core OMAP4470 ARM Cortex processor, and then replace the 1280×800 IPS display for a 1024x600 Pixel Qi panel and we're already well on the way to making a cheaper tablet. Throw in a Google subsidy -- and why not, given that last year Google was pulled in some $2.5 billion in ad revenue from the platform -- and we have a price-point that puts significant pressure on Amazon's Kindle Fire.

One question remains -- can Google make 7-inch tablets suck less in the usability department than the current crop of tablets do?

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