14 DAY TRIAL // More rumors about a Google tablet have surfaced. After chairman Eric Schmidt let it slip that the company is working on a "highest quality" tablet to come out within six months, a new report says that Google is working on a 7-inch tablet running Android 4.0.
That wouldn't be that surprising, even the fact that the tablet will be Google-branded, but the really interesting part is that the tablet could be priced to compete with the Amazon Kindle Fire, which sells for $199, €153.
It is very likely that Google is indeed working on a tablet of its own, the harder part to swallow is the price.
It's not hard to say that Android tablets have been a flop. Amazon has been able to sell as many Android tablets in less than two months than everyone else combined for the past year or so.
But the Kindle Fire doesn't run a pure Android, far from it, and one big reason why it's selling so well is the price.
Google needed an Android tablet to compete with the iPad, but now it really needs an Android tablet to compete with Amazon.
It's been pouring billions of dollars into the operating system for years now and a competitor simply grabbed it for free and has had more success with it.
And if its partners haven't been able to come up with something compelling, Google will have to do it itself.
The 7-inch factor seems like a favorite, it doesn't compete with the iPad and it's cheaper to make. On the other hand, people have tended to prefer 10-inch tablets.
But it is very unlikely that Google will be able to make anything it can sell for close to the price of the Kindle Fire and without it being of very poor quality or Google losing a lot of money on each sale.
Amazon can afford to lose money since it makes it up with sales from its store and of digital content. Google will have to make it up via ad revenue, but that only amounts to a few dollars per year per user, hardly enough to subsidize a tablet.