Jun 272012
 

The new Google Nexus 7 tablet – on sale now from $199.

Google this morning announced it would start selling its own tablet, to be known as the Nexus 7.

This was the key highlight of a presentation to over 30,000 Android developers (and journalists) at the start of its annual developers’ conference in San Francisco.

Google also announced a new version of Android, to be released in mid July; this is a dot point upgrade in the numbering system, from 4.0 (colloquially known as ‘Ice Cream Sandwich’) up to 4.1 (Jelly Bean).

It also came out with a curious device called the Nexus Q, a type of media sharing device, but at $299 we think it will be massively unsuccessful.

The Nexus 7 is an impressive seeming device, and at a wonderful price point.  Google describes it as a product they developed in partnership with Asus – we see this as their way of slightly softening what is in part a direct competition between Google and the hardware manufacturers that use the Google Android OS in their tablets and phones.

The competition between Google and its hardware manufacturers is very different to the new competition between Microsoft and its hardware manufacturers.  Not only does Google spread its favors around with its own branded products, having different companies apparently take turn in making them, and also openly credit the actual manufacturer of the device, but Google gives Android away for free to manufacturers.

In Microsoft’s case, it is claiming full credit for the Surface hardware (of course it is not building the units itself, that is apparently being done in Taiwan), and it sells its Windows OS to hardware manufacturers, which – depending on your perspective – either gives Microsoft an advantage over its hardware partners, or puts its partners at a disadvantage compared to Microsoft itself.

The Opportunities for, and Appeal of, the Nexus 7

Will the Nexus 7 be an iPad killer?

Probably not.  The Nexus 7 has a 7″ ‘widescreen’ screen, unlike the iPad’s larger 9.7″ standard aspect ratio screen (4:3), and the difference in screen size seems to have split the still new tablet market in two – a fact that may even soon be recognized by Apple itself.

Although Steve Jobs had previously said Apple would never release an iPad with a smaller screen, unsubstantiated rumors are suggesting that Apple nowadays is finding itself increasingly interested in not only the part of the tablet market it totally dominates, but the smaller part of the tablet market it currently does not service (due to both size and price).

On the other hand, you can get at least two and a half Nexus 7 units for the price of one iPad.  And unlike the Amazon Kindle Fire, the Nexus 7 is a true full featured tablet, rather than an augmented clever eBook reader (as is the Kindle Fire).

Maybe some people will choose the extraordinary value of the Nexus 7 over the more expensive and bigger iPad.  So, current iPad sales may feel some effect from the Nexus 7.  It is interesting to ponder whether the Nexus 7 will accelerate Apple’s possible plans to release a competing 7″ sized iPad or not – clearly if Apple were to do so now, it would find the market more competitive and, at the $199 entry price, much less profitable, too.

What impact will the Nexus 7 have on Microsoft’s Surface tablet announcement last week?  It is hard to say, because the Microsoft Surface still remains an ill-defined concept, with uncertain specifications and price.  But it seems the cheapest Surface will probably cost $599 or more, and it is a heavy large screen (2 lb and 10.6″) rather than small screen device (12 oz and 7″), so it is fair to say the two products address totally different markets.  Indeed, it is unclear if the Surface will even be competing with the full size iPad, which is lighter and less expensive.

Now, for the most direct impact – what effect will the Nexus 7 have on the Kindle Fire and Barnes & Noble Nook?

The specifications for the Nexus 7 and Kindle Fire show the Nexus 7 to be completely, in every respect, massively better than the Kindle Fire (and it similarly vanquishes the Barnes & Noble Nook too).

The Nexus 7 vs Other Smart eReaders

The Nexus 7 completely redefines the marketplace for eBook readers.

Originally, eReaders were designed to read books and do almost nothing else.  Then two things occurred – firstly, Amazon and other sellers of eBooks released software to allow the eBooks they sell to be read on other devices as well as their own dedicated eReader devices.  This sort of blurred the former one to one relationship between eBooks and the eReaders you could use to read them on.

Secondly, some eReading devices became more multi-purpose.  Barnes & Noble first brought out an Android based Nook that combined normal tablet type functionality with its built-in eBook reader, and Amazon followed up with its Kindle Fire.  This in turn blurred the reciprocal relationship between buying an eReader and what you use it for.

But both the Nook and Kindle readers limit the ability of their owners to download other eReading software.  If you buy a Kindle Fire, you can’t then download the Nook software and buy/read Barnes & Noble ebooks.

Now, with the Nexus 7, you have a choice between buying a device that is physically very similar to a Fire (actually, the Nexus 7 is clearly superior) and which costs the same, or buying a Fire.  The key difference, apart from the better feature set on the Nexus 7, is that with the Nexus 7 you could download (at no extra cost) both the Kindle and Nook ereading software, then buy both Kindle and Nook books, however and whenever you wished.

In other words, the Nexus 7 gives you the best of both worlds, with no trade-offs or compromises.  Who would ever choose a Kindle or Nook now that the Nexus 7 offers you a chance to experience the best of both devices, at the same price, plus gives you additional features too?

We think the only thing that will see a continuation of the viability of the Kindle is Amazon’s massive marketing presence and its ability to promote its Kindle to everyone who visits their site.  Uninformed buyers may still choose to buy a Kindle, and people too technologically timid to do the extremely simple download of the Kindle software to the Nexus 7 may also choose the Kindle, but everyone who considers their choices will surely now choose a Nexus 7 over a Kindle Fire.

One cautionary note.  This is our analysis as of today.  The rumor mill is projecting a new Kindle Fire device to be announced in late July, probably with the same enhanced screen resolution as the Nexus 7, and possibly at the same time, Amazon may drop the price of its present Kindle Fire down to perhaps $149.  This $50 saving would appeal to bargain shoppers primarily wanting an ereader and nothing else.  But for people wanting a fully featured, unrestricted tablet, the Nexus 7 will surely always be the better choice.

The other remaining Kindle concept to remain viable is the bargain basement priced eInk screen type readers – the black and white only, 6″ sized Kindle ereaders, with long battery life and which sell for as little as $79.

It is amazing to compare the original release price of the first Kindle eInk reader, back in 2007, which first sold at $399, and the price of current eInk Kindles, which go down as low as $79.  Will these readers continue to drop in price – maybe to $49 – as a way for Amazon to keep people loyal to its eBooks?  Are eInk type readers becoming like the oft-cited concept of giving away razors so as to sell razor blades?

We wonder also whether Amazon (and particularly Barnes & Noble) will choose to continue to contest the intelligent combined eReader and tablet market much longer.  Does it make sense to struggle to sell devices at cost against the Google Nexus 7 (and, for sure, the oncoming wave of similar devices at similar prices from other tablet manufacturers)?  Or should they concentrate more on the content themselves, and become ‘platform neutral’?

Here is a comparison between the Nexus 7 and Kindle Fire to show the huge
technological lead the Nexus 7 has over the Kindle Fire.

Nexus 7 Kindle Fire
Screen size 7″ 7″
Resolution 1280 x 800 ie 216 ppi 1024 x 600 ie 169 ppi
External dimensions 7.8 x 4.7″ x 0.41″ 7.5″ x 4.7″ x 0.45″
Weight 12.0 oz 14.6 oz
In-device storage  8GB or 16GB (about 3.5GB used by system) 8GB (about 2GB used by system)
Micro-SD No No
USB Yes Yes, 2.0
Battery life   ‘Over’ 8 hrs of video, 10 hrs of web
browing or 10 hrs of reading’.  The battery has a 4325 mAh
capacity.
Up to 7.5 hrs of video, 8 hrs of reading, both with Wi-fi off
Wi-fi Yes 802.11 b/g/n Yes 802.11b/g/n
Bluetooth Yes No
Ext volume controls Yes No
Sensors Accelerometer, gyroscope, magnetometer Accelerometer, gyroscope
Phone data No No
GPS Yes None
Camera Front facing, 1.2 Megapixel None
Microphone Yes None
Processor 1.3 GHz Tegra 3 Quad core, 1GB RAM, plus 12
core graphics processor
1 GHz TI OMAP4 Dual core, 512MB RAM
Operating System Latest Android 4.1 Restricted version of Android 2.3
Near Field Comms Yes No
Kindle compatible Yes Yes
Nook compatible Yes No
Price $199 or $249 for 8 or 16 GB; includes $25
credit at the Google Play apps store
$199

 

Relative Price and Value

It is interesting to compare the price of the tablet ($199 or $249, in both cases with a $25 credit) with that of the strange Nexus Q media sharing device and also Google’s Nexus phone.

The Nexus Q does not have an expensive screen and neither does it have expensive batteries inside it, but it is being sold for $299.  The Galaxy Nexus phone, with a smaller screen, slower processor, 16 GB of memory, much smaller battery, and two cameras rather than one, sells for a newly lowered price of $349.

Why is the most expensive to create device the cheapest to buy?  Clearly Google is hoping to make it up in the ‘back end’ – by taking a share from the sale of apps, videos, and other content that it hopes you’ll be buying for your new Nexus 7.

Availability

The new Nexus 7 can be pre-ordered now from Google’s Play Store, and will ship in ‘2 – 3 weeks time’.

Note that shipping is an extra cost (second day seems the only option, at a $14 cost) and tax may be charged too (it was for our order; we’re in WA).

Summary

The Nexus 7 sets a new high point for performance, price and value in the 7″ tablet marketplace.

The Android range of tablets in general have been slow to catch up on Apple’s iPad series, but with a more closely equivalent range of apps, and massively improved operating system features, the Android products are now reasonably equivalent in overall user experience to the Apple iOS family.

If you are seeking a tablet with a smaller overall size and less weight than an iPad, the Nexus 7 is now clearly the best choice.  If you want an ‘intelligent’ eBook reader that is capable of other things too, the Nexus 7 is again your best choice.

This is a wonderful new device that should prove very popular indeed.  We have no hesitation you do the same thing we have already done, and pre-order one for mid July delivery.

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