Intel Is Taking on Apple's iPad: Here's How They Can Win

Apple's (NASDAQ: AAPL  ) iPad Air is the gold standard in tablet computing today and has been positively flying off the shelves since its launch, reviving Apple's iPad sales. The latest and greatest iPad Air, which sports an Apple A7 processor, 1 GB of LPDDR3, and a 2048x1536 Retina display starts at $499 for the 16 gigabyte version, going up $100 for each storage tier (32, 64, and 128 gigabytes) thereafter. Expensive, but Apple's sales figures don't lie -- many believe they're worth the cost.

How about this disruptive beauty?
Intel (NASDAQ: INTC  ) , the chipmaker well known for being late to phones and tablets, has been very aggressively trying to gain share in the tablet market. Thanks to full Windows 8.1 compatibility, Intel's Bay Trail processors have done very well on Windows. Better late than never, Intel appears to be aggressively pushing on the Android side of things with Bay Trail-T and a cheaper version known as Bay Trail-Entry. This shows Intel is taking on Apple and is looking to win the tablet wars.

One of the first designs based on Bay Trail on Android is the Teclast X98. In the following table, specifications for the iPad Air and Teclast X98 are juxtaposed below: 

The Teclast X98 is an affordable Android-powered alternative to the iPad Air in Asia. Source: Teclast.

 

Apple iPad Air

Teclast X98

Display

9.7" 2048x1536 IPS

9.7" 2048x1536 IPS

Apps processor

Apple A7

Intel Atom Z3740D

Memory

1GB LPDDR3

2GB DDR3L

Flash

16/32/64/128GB

32GB

Connectivity

802.11n 2x2 MIMO Wi-Fi, GPS, Bluetooth, LTE option

Wi-Fi (unspecified), GPS, Bluetooth, 3G option

Battery size

8827 mAh

8500 mAh

OS

iOS 7.1

Android 4.x

Price

$499/$599/$699/$799

$209

Of course, astute readers will note that the iPad Air has a bigger battery, larger storage options, more power-efficient LPDDR memory, iOS, and likely better Wi-Fi. For buyers with deep pockets, the iPad Air is probably in many ways the "better" choice, especially from a brand cachet and ecosystem standpoint. However, mainstream buyers -- the ones for whom value is probably the overarching concern – will likely find the Teclast tablet a very suitable iPad Air substitute. And from Intel's perspective, the more chips it can move, the better.

This is just the first of many
The idea here isn't about this particular Intel-powered tablet; it's nice, and it'll probably do well in China, but Intel is a component vendor that needs many designs to truly succeed. Intel has been very aggressive about engaging the China technology ecosystem (in addition to the Taiwan ODMs) and will likely continue to rack up partners to rally around its platforms as they continue to improve dramatically.

Intel's Bay Trail-Entry (left) lowers platform cost over the original Bay Trail-T (right) for tablets. Source: Intel.

More interestingly, it is in Intel's best interests to have multiple, limited-strength customers than it is to be dependent on a major brand vendor like Samsung or Apple. Would it be nice for Intel to land a Galaxy Tab/Note? Yes! In short, Intel wins the tablet wars by being in as many tablets as possible. However, it is in Intel's best interests for a player like Samsung to not be as strong as it is now -- just as it is in Samsung's best interests for Intel to be weaker -- so if Intel can achieve very high volumes with a horde of smaller players, this is preferable to concentration at a single powerful player.

Foolish bottom line
At the end of the day, it seems that Intel's path to victory in tablets is to enable a broad ecosystem of tablet partners, all wanting any edge they can to differentiate themselves in a crowded market. The Intel brand, as you can see in the advertisement above, is powerful and can help sell through product. It's up to Intel to enable these partners to successfully grab a piece of Samsung's and Apple's tablet profit pie with hardware and software leadership and a strong brand behind them. 

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Comments from our Foolish Readers

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  • Report this Comment On April 06, 2014, at 8:31 PM, bobrobert wrote:

    Not completely on-topic. But, who is buying ipad-air? I have never seen one. Really, they are selling a lot these? Also, quite a few of my 15yo son's friends are switching from their macbooks (which they thought were "magical" a couple of years ago), to high end windows computers that run the games they want to play. Just wondering?

  • Report this Comment On April 07, 2014, at 1:18 PM, techy46 wrote:

    Many believe the iPad Air is worth the cost? Many bought overpriced houses during 2003-2007 too.

    I'll put my $379 Asus T100 Bay Trail-T with microSD, Windows 8.1 and Office 365 up against any overpriced iToy. Can't wait to see those $100-200 Baswell tablets.

  • Report this Comment On April 07, 2014, at 1:19 PM, MattZN wrote:

    This is like something someone would have pulled out 2 years ago. The bullet points are simply irrelevant to today's buyer. Even the price is not so relevant considering the one-off nature of this device, and that Apple has had no trouble maintaining their margins or their ultra-high customer retention numbers and Apple devices retain their resale value far longer than Android pads.

    Not to mention that Intel doesn't produce pads of any kind. They produce processors and the idea that Intel has even a remote chance of competing against Apple from their indirect position is absurd on its face. There's virtually nothing Intel can do from the processor manufacturing side to compete. At best they can push into the market and gain some market share verses ARM for Android devices, but there is nothing they can offer that will give Android device makers a leg-up on Apple.

    These days consumers care more about the experience, upgrade availability, and security. Android is severely lacking in all three departments.

    -Matt

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