Forrester Research published a report asserting that the iPad challengers that have been announced so far?Google?s Android Honeycomb tablets from Motorola, Toshiba and others, as well as Research In Motion?s BlackBerry PlayBook and the HP TouchPad?are solid products with fatally flawed product strategies.

Competing tablets are too expensive, and cannot match the bricks-and-mortar Apple Store as a channel, according to Forrester Research. Forrester?s research shows that consumers attribute more value to Apple products because of the in-store service.

?Miscalculations in pricing and distribution spell trouble for Android tablets,? said Sarah Rotman Epps, senior analyst at Forrester Research, Cambridge, MA, in the report. ?Compare the experience of walking into an Apple Store, where the iPad is front and center, to walking into a Verizon store where the Samsung Galaxy Tab is collecting dust at the back of the store and the sales reps don?t quite know what to make of it.

?Or walking into a Best Buy store, whose shelves will soon be lined with similar-looking tablets with similar functionality,? she said. ?Competing tablets to the iPad are poised to fail, which is why we?re forecasting that Apple will have at least 80 percent share of the U.S. consumer tablet market in 2011.?

Consumers are not only comparing feeds and speeds?there is also a human factor.

The employees working in the Apple Store will have a huge impact teaching consumers about the iPad and how to use it.

Challenging the iPad
Apple?s iPad 2 is the premier tablet on the market, and with each of its competitors having certain drawbacks, it could present an opportunity for a major player in the ebook reader space such as Amazon to shake up the tablet game.

Opinions around the industry on the various tablet alternatives vary widely.

?The release of the iPad 2 is pivotal in the evolution of the tablet market, as Apple continues to drive innovation in this space,? said Krishna Subramanian, cofounder of Mobclix and vice president of marketing at Velti, San Francisco.

?New entrants such as Samsung, Motorola and BlackBerry are also doing their part to help propel the industry forward as they each seek to address varying consumer needs ? from ereading to gaming,? he said. ?Moreover, the rapid growth of this market also signals an increase in user demand as tablets are becoming more and more a fixture in people?s everyday lives.

?With the development of the tablet market, we?re also very excited to see the next wave of mobile apps and the various ways publishers are going to package up their content to further engage their desired market based on the increase in device diversity.?

But what comes next?
Forrester's Ms. Rotman Epps said that Amazon could be best positioned to meet the iPad challenge. She sees a market that is ripe for disruption by Amazon in particular.

Amazon could create a compelling Android- or Linux-based tablet offering easy access to The Amazon.com storefront, including its forthcoming Android app store, and unique Amazon features such as one-click purchasing, Amazon Prime service and its recommendations engine.

Amazon has the motivation to counter Apple?s threat to its business model.

By implementing onerous rules for ebook sellers and other content providers that require in-application payments, Apple may have created its own worst enemy, per Ms. Rotman Epps. 

Now Amazon has the motivation to launch its own device, where it will have more control over payments and customer data.

Amazon also has a pricing model that could work.

The mass market of consumers wants cheap tablets. But the carrier-subsidy model that Motorola, Samsung, Dell and others are offering to bring down the price of their tablets will not appeal to consumers: Forrester?s data shows that consumers want flexibility with their mobile broadband contracts on tablets.

Amazon could offer a different model?selling a tablet at or below cost and making up for it by selling content, as it does with the Kindle.

Unlike the Kindle, however, consumers would need to foot the bill for 3G/4G service, as they would be using far more data than ebooks alone require.

Amazon also has the brand, content and channel to pull it off, per Ms. Rotman Epps.

According to Forrester, more consumers that are considering buying a tablet say that they would consider Amazon?24 percent?than Motorola?18 percent.

Amazon?s content assets include not only media?Kindle ebooks, MP3s, videos and games?but also ecommerce goods?50 percent of current tablet owners say they use them to research and purchase products?and services such as Amazon Prime.

Ms. Rotman Epps said that Amazon.com is also a channel in which a sizable segment of consumers feel comfortable purchasing electronics: 28 percent of consumers considering buying a tablet say they would prefer to buy it from an online retailer such as Amazon, compared with 11 percent that say they would prefer to buy a tablet from a carrier.

?Amazon isn?t the only potential disruptor to the still-forming tablet market,? Ms. Rotman Epps said. ?We outline ways in which Sony, Microsoft and Vizio could disrupt the tablet market too?all this disruption leads to some surprising conclusions.

?Product strategists delivering content on tablets need to rethink their priorities?most companies we speak to are prioritizing Android apps after iPad, but it?s not a foregone conclusion that Android tablets are worth the investment this year,? she said.

?Product strategists on the device side have some reformulating to do?some may find it makes sense to wait until the market settles before launching a tablet that won?t sell in volume this year.?

Apple captures 83 percent tablet market share
According to the International Data Corp. Worldwide Quarterly Media Tablet and eReader Tracker, 10.1 million media tablets were shipped in the fourth quarter of 2010 ? more than double the 4.5 million shipped in the third quarter.

Apple's share came down from 93 percent in the third quarter to 73 percent in the fourth quarter, but still reflected Apple's strong leadership position.

Samsung's Galaxy Tab was the primary competitor in the holiday season, beating other players to market and capturing more than 17 percent share, while a number of smaller regional players also participated.

?Strong holiday sales of media tablets were in line with IDC projections and strong consumer interest in the category while device vendors scrambled to offer products competitive with Apple's iPad and now iPad 2,? said Loren Loverde, Ft. Lauderdale, FL-based vice president of consumer device trackers at  IDC, in the report.

Media tablets are on pace to reach shipments of roughly 50 million units in 2011, per IDC.

The tablet market evolution will be driven not only by product introductions from PC, consumer electronics, and mobile phone vendors, but also by expanded distribution channels?with wireless carriers playing a key role?and commercial adoption by businesses.

According to IDC, the United States, Western Europe and Asia/Pacific (excluding Japan) regions accounted for 89 percent of all media tablet shipments in the fourth quarter.

Although the United States remained the largest country market, Western Europe and Asia/Pacific (excluding Japan) grew almost twice as fast from the third quarter to the fourth quarter, and Western Europe saw a slightly larger jump in shipments in the fourth quarter.

In the fourth quarter, retailers were the channel with the highest share of shipments, followed by direct and telco sales.

A new channel for media tablets, the telco carriers, accounted for nearly 14 percent of all shipments of media tablets in the fourth quarter following just over 1 percent share in the third quarter, per IDC.

Apple is building on its strong 2010 first-generation iPad launch with the iPad 2, before most competitors come to market with first-generation media tablets.

Although more competing devices will be launched this year, IDC expects Apple to maintain a 70-80 percent share of the market this year.

Samsung started shipping its seven-inch Galaxy Tab media tablet in the fourth quarter.

Although its shipments into the channel were fairly aggressive, a lack of competitive pricing and ongoing competition from Apple stifled consumer demand, per IDC.

?Samsung is expected to follow with a 10.1-inch Galaxy Tab with Android 3.0 Honeycomb later this year, but the refresh will have a tough time maintaining share as more competitors enter the market,? Mr. Loverde said.

?The recently launched Motorola Xoom is a worthy competitor in function, although the relatively high price is expected to be a barrier to gaining significant share,? he said.

Other vendors and designs are expected to hit the market in earnest in the second half of 2011.

Many of these products will be more competitive in function, like the Xoom, but IDC expects only those from large vendors with significant marketing and channel structure in addition to a few technologically and price competitive devices to capture significant share.

?One differentiation path that some vendors are likely to take is to focus on specific market segments, such as commercial,? Mr. Loverde said.

?While benefitting from unique product positioning, they are likely to address a smaller overall market and will need to be competitive with devices from Apple and others,? he said.

Collectively, Android-based tablets are iPad's biggest competition and IDC expects them to represent about one-quarter of worldwide shipments this year.

But keep in mind that segment includes multiple tier-one vendors as well as tier-two and tier-three vendors.

Vendors that price their devices competitively against iPad will be best positioned to take on Apple in this market, but so far few have.

Amazon competitor Barnes and Noble introduced the Nook Color ereader last fall, and that device has many of the features of a media tablet.

Limited application accessibility prevents it from being considered a full-fledged media tablet.

Pandigital also offers color LCD-based devices marketed as ereaders with limited applications, but those products have the potential to evolve into media tablets with the next generation refresh, per IDC.

"For ereader vendors, it's an opportunity to cast a wider net outside of the narrow ereader/reading-optimized device market at the same time that it pits them against major competitors in the PC, CE and mobile space," said Susan Kevorkian, San Mateo, CA-based research director of mobile connected devices at IDC.

Final Take
Dan Butcher is associate editor on Mobile Marketer