The iPad is about to get some legitimate competition. In an interview with Bloomberg, David Schmoock, head of Lenovo’s North American operations, said that tablets running Windows RT will be $200 to $300 less expensive than their full Windows 8 counterparts. And since he states Windows 8 tabs will be between $600-$700, that puts the RT models well below the iPad.
It should be noted that Schmoock is likely only speaking for Lenovo. The highly anticipated Microsoft Surface will likely follow the same pricing scheme. Microsoft has so far been very quiet about its target price. Still, the iPad might finally have some real competition if the Windows tablets are priced as competitively as noted here.
Consumers have shown that they want a tablet. That market segment is growing rapidly and should continue as more models are available at different price points. As John noted yesterday, some companies are racing to the bottom, offering stripped-down Android tablets at low prices. But Windows tablets might have to go the other way.
Microsoft is reportedly charging OEMs a pretty penny for Windows RT; Windows 8 likely costs even more. Several reports indicate that Microsoft is asking $85 per Windows RT licence. And such it’s not likely that Windows tablet, being of the RT or Win 8 variety, will hit at Nexus 7-ish price point. OEMs will likely swing, at least initially, Windows tablets upmarket, where the air is a little less crowded and the margins a little easier to see.
“RT will play in consumer and retail at very aggressive price points,” said David Schmoock, head of Lenovo’s North America operations. “It will do well but it’s going to be more of a consumer price point play to begin with,” he said, in an interview with Bloomberg yesterday.
Right now there are essentially two tablets on the market: the $499 iPad and the $199 Nexus 7, which replaced the $199 Kindle Fire. And such, the price points in between are wide open. It’s safe to expect Windows RT tablets to undercut the base iPad’s price while offering a similar screen size and local storage. Then, for a few dollars more than an iPad, or so will a PC maker like Lenovo will brag, a Windows 8 tablet is available, but offer a full desktop environment built around a touch interface. But the tablet market might soon get another player.
If internet rumors are believed, Apple is about to launch an iPad mini with a price between $250-$350 — slightly undercutting Windows RT tablets, but doing so by offering a smaller screen.
The iPad is running the tablet world but there is plenty of room in the growing market for more leaders. Windows tablets are set to offer a different experience than the iPad’s. Even if the pricing is similar, the capabilities and use cases should be different enough that Windows RT/8 tablets might have a chance to succeed at the reported price points. If not, they can always join the race to the bottom and sell gimped versions to compete against the cheap Nexus 7.