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Just like every other "revolutionary" product that Apple (Nasdaq: AAPL ) has released, the iPad will have to face off against numerous imitators out to steal its thunder. As a slew of phones running Google's (Nasdaq: GOOG ) Android give Apple a tough fight in the smartphone space, it's understandable that some investors worry about how an upcoming flood of tablet releases featuring Android, Hewlett-Packard (NYSE: HPQ ) subsidiary Palm's webOS, or Research In Motion's (Nasdaq: RIMM ) Blackberry OS could dent iPad sales.
Nonetheless, the tablet market isn't the smartphone market. There are several big reasons why the iPad should continue to rule the roost in the near term.
Building a good tablet isn't easy
Apple went to great lengths to adapt its iOS operating system, and the core apps that come preinstalled with it, for a tablet's form factor. Chances are that it will take a while for Google to do the same with Android, or RIM with the Blackberry OS. In addition, Apple's hardware design accomplishments with the iPad were no mean feat. Rival manufacturers will have trouble matching the iPad's stellar battery life – especially if they want their tablets to deliver processing power that's competitive with Apple's proprietary A4 chip.
Apps, apps, apps
Thanks to the iPad's hype and early success, the App Store now carries more than 10,000 apps specifically written for the device. Android has recently made a lot of progress in narrowing the iPhone's lead when it comes to available smartphone apps, but it took a long time to do so. Now it looks like Android will be playing catch-up all over again in the world of tablets.
As for RIM and HP? Considering how badly their operating systems have fallen behind when it comes to smartphone app support, there's little reason to think that they'll be more successful in the world of tablet apps.
AT&T is less of a problem
I've gotten the crazy impression that the iPhone's reliance on AT&T's (NYSE: T ) shaky mobile network within the U.S. has cost it some sales, and given Android smartphones a leg up. While the iPad also relies on AT&T's network, I think this tie-up will do far less sales damage. First, many of the AT&T-related complaints for the iPhone involved dropped phone calls, which obviously isn't an issue for a tablet. Second, subscribing to a 3G data plan for the iPad doesn't require a user to sign up for any kind of mobile phone service contract. Thus, unlike with the iPhone, users who prefer to go with Verizon (NYSE: VZ ) , Sprint (NYSE: S ) , or T-Mobile as their mobile service provider have been able to snap up 3G iPads without any trouble.
Many of the iPad's competitors will have an edge over Apple in terms of pricing, especially after factoring in the carrier subsidies that will be attached to some of their 3G tablets. Perhaps this pricing edge will force Apple to rethink its tablet business model and offer subsidized versions of the iPad (in conjunction with 3G data service contracts).
But that's the only chink in the iPad's armor for now. If pricing isn't too much of an issue, the combination of the iPad's early lead and competitive strengths mean that Apple should remain the undisputed colossus of the tablet market for at least the next 12-18 months.
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