Apple (AAPL): Processor Power May Be Key To Tablet Sales

Nokia (NOK) is launching its netbook, a 10″ screen model which weighs 2.75 pounds and runs Windows. It comes into a remarkably crowded market. But, launching a product for the segment is nearly irresistible. NPD says global netbook sales will double this year to 32.7 million.

Nokia has had a habit of being late recently, particularly in the smartphone business. It has cost the company sales and its shareholders a great deal of money. The firm may have trouble competing against Acer, Asus, Samsung, and HP (HPQ) which have had products in the netbook  market for months.

Apple’s product for the segment, the new tablet, may be ill-suited to do well when it is compared to $300 netbook PCs, but its processor may be the key to being competitive. Piper Jaffray expects the Apple hardware to be priced at $600. The will put it beyond the reach of many consumers who simply want a basic machine for checking e-mail and using the internet.

The speculation about the Apple tablet is that it will have a 10.1″ screen. That is not advantage over current products in the category. Its WiFi capacity is also not special.

The Apple name may sell several million tablets, but once that novelty wears off, two features may be critical to the firm’s ability to get a premium price. The first is the processor which may be an Intel (INTC) Core 2 Duo @ 2.13GHz. Netbooks are remarkably slow compared to laptops. Apple appears to be ready to solve the problem for customers. Battery life should be another winning point for Apple. Many netbooks only hold a charge for two hours. Battery life for the tablet is rumored to be between six and twelve hours.

Apple’s sales may be limited by the fact that tablet will run the Mac OS X 10.6. Most consumers are still used to Windows. Some may simply stay away from the Apple product because of their concerns about the software.

Apple will offer features that netbooks don’t, features that will draw users the way that the iPhone did, but the key to sales may simply be that the tablet is not underpowered.

Douglas A. McIntyre

For more information on Apple visit applefinancianews.com