The Monday introduction of another low-priced rival to the iPad won’t keep anyone at Apple’s California HQ up nights, analysts said.
On Monday, Barnes & Noble unveiled its $249 Nook Tablet , following rival bookseller Amazon into the 7-in. Android-powered tablet market. The Nook is to go on sale at the end of next week, several days after Amazon’s $199 Kindle Fire tablet begins shipping.
Neither the Kindle Fire or the Nook Tablet menace Apple’s dominance of the tablet market, said analysts.
“I wouldn’t think Apple would be losing a lot of sleep about either,” said Tom Mainelli of IDC. “The Nook and the Fire are throwing the [tablet] market open to a larger group of consumers who would not have spent the $500 for an iPad. It further legimizes the category.”
Sarah Rotman Epps, an analyst with Forrester Research, agreed that the two Android tablets, even though they’re priced hundreds less than the lowest-priced iPad, don’t pressure Apple’s position as the tablet leader.
“The Nook, like the Fire, expands the market,” said Epps. “All three can be successful.”
While the new entries may make inroads of sorts on the iPad, Epps added, the impact will be minor, what with Apple’s iPad sales being an order of magnitude larger than these rivals. Epps estimates that Barnes & Noble will sell 1.5 to 2 million Nook Tablets in the fourth quarter, and Amazon will sell 3 million to 5 million Kindle Fires.
“But if Apple keeps selling iPads at its current rate, it could sell 20 million worldwide in the fourth quarter,” she said.
In third quarter, Apple sold a record 11.1 million iPads .
Mainelli doesn’t believe Apple’s sales will suffer either at the hands of Amazon or Barnes & Noble. “Apple will continue to sell as many iPads as they can make,” he said.
Both Mainelli and Epps noted that while Barnes & Noble faces a battle, the bookseller has one advantage over Amazon: its brick-and-mortar stores.
“The Nook Tablet will sell to people who not only would not have purchased an iPad, but it will appeal to people who walk into the Barnes & Noble stores,” said Mainelli, talking about the floor space Barnes & Noble now dedicates to its Nook line and plans to create Nook-specific stores within its stores. “There are people who would not set foot in an Apple store or a Best Buy, but who will spend time at a Barnes & Noble.”
Epps also cited the ability to try a Nook Tablet before buying, and the available in-store service and assistance, as a way to “take a page right from Apple’s book” and differentiate its device from the less-expensive Fire.
One thing the experts disagreed on was whether the introductions of the Kindle Fire and Nook Tablet—both priced under $250—prove that there’s really no room for devices that cost more than that but less than Apple’s iPad.
“The Fire can do well at the low-end, while the iPad will dominate on the mid- to high- end,” said Brian White, an analyst with Ticonderoga Securities, in an email reply to questions. “But there’s not much room in between for a real tablet.”
Epps echoed White, but Mainelli wasn’t as certain.
“I do think we’ll find a market in between these two prices,” said Mainelli. “There’s definititely a place for a 9- or 10-in. tablet priced at $300 or $350.”