A good article, but I think it misses one important point: the eventual commoditization of devices like this. Apple's entire touch screen platform does look compelling for non-techs, but there will be a raft of very inexpensive similar devices hitting the market, and I still think that lower cost will win the most market share (eventually).
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In the same way the iPod range has been crushed by generic MP3 players?
Interesting, but the MP3 player market seems to be somewhat of a fluke in terms of resisting commoditization. Perhaps it's due to the iTunes marketplace keeping Apple's product line superior, in which case the iPad + App Store combo could end up doing the same. Then again, the iPhone doesn't have the market share that the iPod does, and I think iPhone market share will peak and then drop as Android and other mobile handsets come online that are truly competitive.
On the other hand, businesses generally buy PCs because they're far cheaper, but the market for MP3 players in a business context is basically non-existent, whereas it's potentially huge for the tablet market, so that's another mark against Apple.
It'll be interesting to see how it all turns out.
But market share does not equate with revenue.
As highlighted in the iPad launch, Apple introduced the modern laptop with the first ever PowerBook. The laptop market is now definitely commoditized but that doesn't stop Apple from making a lot of money selling fewer highly profitable laptops.
They have something under 10% of the total laptop market but 90% or more of the segment > $1,000 per computer.
At that point, just release an iPad app into the wild like they've done with iTunes and Safari. You'll still have iTunes and the App Store, and they'll still be able to dominate the high-end high-margin part of the market.
Actually, they'd probably wind up selling more of their kit by doing this!
I wrote about this at my blog (http://www.pchristensen.com/blog/articles/a-closed-apple-pla...) but here's a quick recap.
Since technology advances faster than consumer demand, the differentiating factor for purchases changes over time. First it's possibility, then power/flexibility, then price, then convenience/usability. iPods and mp3 players got cheap enough that the usability of th iPod/iTunes Music Store became the deciding factor and there was no demand for undercutting it on price.
Also, the music use case is so well defined that there wasn't much room to compete on flexibility. PCs have miles and miles of flexibility, but by defining the role of the iPad as music, movies, books, and games (basically media consumption), it might be staking out a territory where it can outperform everyone rather than compete with commodity devices.