For many people, it's a safe bet that the iPad will not replace or preclude the purchase of a Netbook. A quick look at the specifications and it's pretty obvious why.
As this tweet succinctly put it: "What has no webcam, no multitasking, no HDMI port, and (possibly) no Flash, and costs $500? Hint: Not a netbook." This tweet, of course, is referring to the Apple iPad. And, by the way, you can eliminate the parenthetical; the iPad definitely does not support Adobe Flash video. (Also see this post at Gizmodo.)
But specifications aside, here's the most fundamental difference. The iPad is what analysts call a purpose-built device. It does certain things very well (e.g., video, Web browsing, e-reading) and other things (most notably office productivity apps) not so well or not at all.
The Netbook--though not as fast as a standard laptop and handicapped by a relatively small screen--is still a PC and is capable of doing pretty much everything a standard PC does. In other words, it's a general-purpose device.
Then there's the physical difference. Consumers who make the leap from a notebook or Netbook to a tablet will immediately recognize the ergonomic limitations of a tablet. In short, the inconvenience of not having a physical keyboard: the keyboard on a laptop also acts as a ballast--or stand--for the screen. Needless to say, that's why laptops decorate Starbucks tables and airplane trays. (Yes, Apple will sell an iPad case that serves as a stand but that does not make it a laptop.)
That said, preemptively panning the device is foolhardy. Consumers will undoubtedly find novel ways to use the iPad. And I will likely be rubbing elbows with an iPad user at Starbucks as soon as it hits stores.