iPad To Face Stiff Competition From Android Tablets

Apple’s newly launched iPad tablet could be facing some stiff competition, after an analyst predicted that a quarter of all the tablet devices that ship this year will run Google’s Android operating system.

Google is already seeing a healthy increase in market share for Android-based smartphone handsets and its Chrome web browser. However, a new report from IMS Research estimates that Android will be installed on 24 percent of the tablet devices that ship in 2010. At the CES event in January, Dell exhibited its first tablet prototype running Android, and company representatives said they were looking at other screen sizes for the tablet beyond the five-inch version shown.

“The user interface and content that a tablet supplier brings to the table will likely influence purchase decisions just as much as hardware requirements,” said Anna Hunt, report author and principal analyst at IMS Research.

“Suppliers are realising the importance of content and service and many are turning to the Android ecosystem to be able to offer the complete user experience and compete with Apple’s offering,” Hunt said.

Rival tablets in the works

But it seems that tablet builders are not just looking at Android, as a number are also planning on using Microsoft’s Windows 7. Indeed, IMS Research estimates that Windows 7 will account for 10 percent of tablet shipments in 2010.

And IMS Research is concerned that Apple is pricing the cost of apps for the iPad at too high a level.

“Right now many of the applications specifically designed for the iPad platform, which are starting to hit the iTunes App Store, are actually more expensive than apps for the iPhone OS platform. This leaves an opportunity for suppliers that can offer a tablet solution that is overall more price competitive, both for the hardware and the content,” said Hunt.

And Apple should expect some tough competition on the actual cost of the iPad device itself. At the moment, Apple is selling the iPad in the United States for around $499 (£316) to $829 (£525), depending on the model. However IMS Research thinks users will be able to get a much cheaper alternative.

“Over the next couple of years, we can expect a variety of tablet models that may not be able to run word processing software, but will offer a variety of web-based and multimedia applications for under $200 (£132) to the end user,” Hunt said.

IMS Research is also forecasting that from 2012, over half of the tablets sold each year will be distributed via mobile and fixed carriers, as they offer “increasingly competitive service plans and up-front equipment subsidies to attract tablet purchasers and increase subscription revenues.”