Quarter 4 Tablet Wars

1. Two new Amazon tablets: By the holiday season, Amazon will have two new Kindle Fires on the market. It will have a new 7-inch version and one in the 10-inch range. Like the current , it will be based on a homegrown version of Android. I am hearing, however, that there may be a twist coming with its 7-inch model. Amazon is very fond of its Prime service, but its recent financials suggest that it had overestimated the number of people buying into the Prime. The company therefore may want to find ways to boost Prime subscribers.

Today, Amazon sells the Kindle Fire at a loss but makes up for it through media purchased or rented. Amazon feels that Prime is a strategic product and I imagine that it may want to get more creative and aggressive in attracting new Prime subscribers. So, I would not be surprised if it perhaps discounts the Kindle Fire and sells it at a very reduced rate to entice customers to sign up for Prime. For example, Prime is $79 a year, but it could offer customers who buy a Prime subscription a Kindle Fire for $129 or $149, reduced from the regular $199. This could be a quite successful tactic and could really boost overall sales of its tablets.

2. A 7-inch iPad: Rumors are also flying that Apple will release a 7-inch iPad in time for the holidays. What's more, Samsung Securities gives credence to this rumor in one of its analyst reports. (This is odd since Samsung is one of Apple's suppliers and while Samsung Securities is not tied to the Samsung supplier group, its comments on this are interesting at best and bad form at worst.)

Now, I have no clue if Apple is in fact making a 7-inch version of the iPad. Given Steve Jobs' past aversion to a tablet of this nature, it would be quite fascinating if Apple did do something in this size. However, Jobs did things that he had previously said he would not do, so you can't count it out. Imagine if Apple decides to rollout something around 7.8 inches; it would be larger than a Kindle Fire yet feasible to manufacture more inexpensively than the new iPad. Even if Amazon drops the price of a Kindle Fire when packaged with a Prime subscription, its combined price (if the Fire is priced at, say, $149) would be $228. I would expect that Apple would price a 7.9-inch iPad between $299 and $329. It could easily entice potential Kindle Fire buyers to purchase an iPad mini instead and increase its market share this fall significantly. Now, this is pure speculation on my part, but it would not surprise me.

3. The awaited Windows 8 tablet: I hear Windows 8 on tablets will be announced at an event in New York City on October 22 and come to the market by Q4. But given the fact that there may not be a lot of Windows 8 Metro-tweaked apps available at launch, it's unclear how much a Windows 8 tablet will impact this holiday season. Still, a lot of IT directors are anxious to get early models to test in their shops because these Windows 8 tablets can run in both Metro mode and traditional mode—an important feature for businesses that want to run current Windows apps.

However, if you look closely at Windows 8, you'll see that it's really is a consumer tablet OS. While it may not have a big impact in Q4, it could become a serious tablet aimed at consumers in 2013.

4. A Chrome-based tablet: Don't forget that Google Chairman Eric Schmidt said a few months ago that the search superpower is also for release sometime this summer. Interestingly, many believe that it would be a Google-branded Android tablet, but I am not too sure I agree. It could be Android-based, but it seems to me that this would put Google in direct competition with its customers—not a brilliant way to woo them. Instead, it would make a lot of sense for its new tablet to be Chrome-based. It could launch Chrome tablets into the market. But regardless of what OS it uses, you can expect Google to be a tablet player in its own right this holiday season.