With no new Nexus 10, iPad has few rivals in high-end tablets

The competition from the Android side appears content to cluster at the low end. So yes, there is a reason Apple can keep its tablet prices high.

Roger Cheng Former Executive Editor / Head of News
Roger Cheng (he/him/his) was the executive editor in charge of CNET News, managing everything from daily breaking news to in-depth investigative packages. Prior to this, he was on the telecommunications beat and wrote for Dow Jones Newswires and The Wall Street Journal for nearly a decade and got his start writing and laying out pages at a local paper in Southern California. He's a devoted Trojan alum and thinks sleep is the perfect -- if unattainable -- hobby for a parent.
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Roger Cheng
3 min read
Google's Nexus 10 tablet.
Google's Nexus 10 tablet. Josh Miller/CNET

Apple may be seeing an army of rivals jumping into the tablet business, but the iPad is still largely standing by itself when it comes to the category of large premium products.

Last week's debut of the Nexus 5 smartphone -- and not a new Nexus 10 tablet -- suggests that Google is ceding the market for high-end tablets to Apple as it focuses on budget-friendly mobile devices. If nothing else, it knocks out the iPad's biggest competitor.

The Nexus 10 was supposed to take on the larger iPad with updated software, super-crisp display, and faster processor. CNET editor Eric Franklin called the Samsung-made device the best iPad alternative in the market, lauding its sharp screen and high-end specs. Despite the critical praise it received, the Nexus 10 didn't take off as quickly as its smaller brother, the Nexus 7 (which did get an update earlier this year).

"I think the lack of a Nexus 10 refresh (at least to date) reflects the fact that the market for a premium Android tablet is still pretty small," said Tom Mainelli, an analyst at IDC.

For Apple, the high-end tablet business is more critical than ever as the company faces an assault on a tablet market as a whole that it once dominated. In the third quarter, the company saw its share fall to just under 30 percent from 40 percent a year ago, according to IDC.

The market share losses, however, have largely been from the lower end of the business, an area Apple hasn't been too keen on moving into. By preserving its premium brand and reputation, Apple is able to generate higher profits and revenue from its iPad line.

Just look at the pricing of the iPad line. The 10-inch iPad Air starts at $500, above most tablets of that size, and even the smaller iPad Mini with Retina Display got a price bump and starts at $400. Apple's only concession to the penny-pinching crowd is the year-old iPad Mini, now at $300, and the three-generations-old iPad 2 priced at $400.

Those pricing levels suggest that Apple doesn't really care about consumers looking for a deal. Yes, there are some lower-priced options, but a year-old iPad Mini and a much older iPad 2 can't compare to today's current slate of affordable tablets.

Avi Greengart of Current Analysis, who covers consumer devices, said he was surprised that Google opted not to update its Nexus 10. As it stands, the current model will have a tough time competing against the iPad Air, he said, adding that it would need "to go on a diet" and get a speed boost to remain competitive.

While Apple may have made only minor specification improvements and trimmed down the body in the iPad Air, which went on sale Friday, the changes are enough to keep it on top of the tablet market and justify its premium reputation.

Apple's iPad gets light as Air (pictures)

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Google, meanwhile, sees its tablets as tools to get developers on board with Android tablet apps.

"As such, they really only needed one tablet and they've really focused on Nexus 7 as the solution for that category," said Jan Dawson, an analyst at Ovum.

Even other full-sized tablets, such as the larger Amazon Kindle Fire HDX, are positioned a bargain relative to the iPad.

The biggest source of competition on the high end comes from Samsung, which continues to push a large number of tablets in different sizes and configurations. The company captured more than 20 percent of the tablet market in the third quarter, according to IDC.

But as much as Samsung has improved its own tablets, including the Galaxy Note and Tab lines, few of its products enjoy the buzz of Apple's iPad, or even Samsung's Galaxy S4 smartphone.

The Nexus 10, with the backing of Google, could have been that marquee larger Android tablet.

But for now, it appears that Apple has a lock on that segment.