14 DAY TRIAL // I have just reported on the high odds of a tough price competition sparking on the 7-inch tablet market later this year.
Now, I think it would have been more accurate to say price war, since there is already a tight enough competition for profits to be damaged.
Indeed, sources from distribution channels have revealed that 7-inch tablets are already cheap enough that tablet makers, but especially Acer and ASUS, have been suffering in terms of profits because they have been selling them for as little as $170 / €170.
Then again, the situation is quite justified. Lower prices lead to higher sales, and even if the extra orders don't make up for the price cuts, they do raise awareness of the brands, which was the whole point of dropping prices in the first place.
On the flip side, the price competition to get any harsher would mean bad things for brand value, since consumers still want guarantees, quality and maintenance services.