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5 Stocks, 5 Competing Tablet Strategies

Tamara Rutter
July 10, 2012

Mobile devices are taking over the world. This digital frontier is being fueled by a growing demand for tablets of every shape and size. Apple (Nasdaq: AAPL  ) , the most valuable company on the planet, may have popularized tablet devices, but it's no longer the lone ranger in the space. Let's take a closer look at today's leaders in mobile computing and see which stocks are likely to come out on top in the second half of 2012.

The remainder of the year is shaping up to be one of next-generation products. Word on the street that Apple plans to release a smaller version of its popular iPad emphasizes its push to better compete with cheaper devices such as's (Nasdaq: AMZN  ) Kindle Fire and Barnes & Noble's (NYSE: BKS  ) Nook.

Mini-devices with massive appeal 
The release of a 7-inch iPad mini at around $299 is still speculation at this point. However, the move would help Apple broaden its customer base, since many consumers can't afford to spend between $499 and $699 for the 10-inch version. In fact, analyst Gene Munster of Piper Jaffray estimates that a smaller form iPad would boost Apple's revenue in the fourth-quarter by around 1%. He also thinks the mini version could steal as much as 30% market share from Android-based tablets.  

That's a bold assertion, considering Apple already claims 68% of the tablet market. If the rumors are true, the new iPad Mini will help Apple maintain its firm grip on the market. Still, Apple isn't the only one with next-generation products on the horizon.

Shiny and new
Amazon plans to launch an updated Kindle Fire before the holiday season this year. According to All Things D, the new model will feature a sharper resolution for improved viewing in addition to being a lighter and thinner version of its former self. Sounds great. But, I'm not sure it will be enough to safeguard against the possible arrival of a smaller, cheaper iPad.

True, at $199 apiece, Amazon's Fire would still be less expensive than the rumored $299 price tag of the iPad mini. However, I think people will be willing to pay an extra $100 for an iPad over a Kindle -- in part because of the way Apple markets the device as a multipurpose product rather than solely a media player or e-reader.

I suspect that with both Amazon and Apple releasing improved models of their popular devices, Barnes & Noble's Nook Color will be left in the dust. Meanwhile, two of technology's other biggest names, Google (Nasdaq: GOOG  ) and Microsoft (Nasdaq: MSFT  ) , have also entered the market with rival tablet products.

Crowding the market
Feeling left out, Google recently joined the party with its Nexus 7. The new Android-powered device is a duplicate of the Kindle Fire in terms of screen size and price. Microsoft is also building and selling its own integrated device. The software giant's new Surface PC tablet marks the company's official shift to include hardware.

The move is particularly important for Microsoft, as the company has struggled to gain a solid footing in the mobile market. Because of the strength of its Windo