The Tablet Wars--What's Next?

The Hewlett-Packard TouchPad (above), launched to much media fanfare and in many channels to compete with Apple's iPad, has been a monumental disappointment in its first weeks. After a surprisingly slow start, H-P cut the TouchPad's price. But even that move failed to ignite TouchPad sales, and the product has been axed.

In fact, Hewlett-Packard just announced its planned spinoff of the PC/tablet/smartphone division. The intense competition in PCs/tablets has driven prices down and shaved profit margins, making that business less desirable for long-term growth, in H-P's view. H-P will retain its printer business and is looking at software for future growth.

But what happens next in the tablet wars? Apple is, far and away, the undisputed market leader. Dell has tried smaller tablets (the Streak 5) but discontinued this in-between size, neither a smartphone nor a full-fledged tablet. Watch for Dell to upsize its tablets and iPad to intro ever more innovative, powerful, feature-rich iPads. With the rate of adoption so rapid, this product category is sure to be a market-share battleground for the next couple of years.