Why Google Should Stay Out of the Tablet Game
Google's hardware expansion plans into tablet world, like its social expansion plans into Facebook world, will probably fail. The plan, according to myserious unnamed sources quoted by The Wall Street Journal's Amir Efrati is that the company will sell Google-branded Android tablets. Lots of big, ginormous, red flags here. The search company hasn't done well in the gadget department, putting out a failed phone and a failed computer. This tablet thing feels like another one of those projects Google has taken on because it thinks it has to "get into the hardware business." It had this same mentality with the social game. And we've see how well that's worked out for them. Google, unless you've got some kickass tablet back there, don't do it.
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The problem isn't the actual device, really. We don't get much info about it anyway from this anonymously-sourced report, other than the fact that Google will work with Motorola to manufacture the devices, co-brand them and sell them in their own Google store. But, it's the motivation that sounds suspect. "By selling tablets directly to consumers, Google is upping the ante against Apple, which debuted its market-leading iPad two years ago," writes Efrati. Google's getting into this tablet biz because it has to compete with Apple, not because it has some awesome life-changing product. It took that strategy with Google+."It turns out that there was one place where the Google innovation machine faltered and that one place mattered a lot: competing with Facebook," explained former Google engineer and current Microsoft employee James Whittaker after quitting the 'plex. The result of that strategy, so far, has been alienation.
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The innovation machine has actually faltered in another place: hardware. "Google went this route with Android-powered smartphones in 2010 when it offered a device called the Nexus One made by HTC Corp. But the effort was scrapped after several months amid better sales of other Android-powered smartphones," explains Efrati. It has also experimented in the laptop department. It took a more Google-ish (ie. innovative) approach to the Chromebook, however, developing a cloud-reliant machine -- something never done before. But even those haven't done too well, with price reductions after the first six months of slow sales. Hardware isn't Google's game.
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And it probably won't change with the tablet because of the way that market already works. "To really make an impact in the tablet market, though, Google will likely have to either drastically undercut the iPad on price (which it would if its sells them for $199) or build tablets that are close to being as good as the iPad," notes Business Insider's Henry Blodget. But would that even work? The Kindle Fire already did the cheap thing. And while Amazon claims high sales, Apple CEO Tim Cook doesn't sound too worried. "In terms of the competetive ecosystem, the iPad is in a class all by itself," he said during an investor Q and A. "They'll [Amazon] sell a fair number of units...but I don't think people who want an iPad will settle," he continued. And, those big sales -- 3 million in one weekend -- justify that attitude.
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Google could also win this market by building "tablet[s] that are close to being as good as the iPad," says Blodget. Really, though, Google would have to create something better. And, since Google isn't a hardware company, that doesn't look likely.
