The last time a name-brand tablet cost $99, it was the 16 GB HP TouchPad during HP's fire sale. The company had abandoned the tablet market, and was liquidating its stock of webOS tablets as fast as it could sell them, by dropping them to an almost unbelievably low price.
The closest the Android world has gotten to that price point so far, if you don't count the $159 non-HD Kindle Fire, is the Nexus 7. It may be the best-selling Android tablet ever which doesn't carry Nook or Kindle branding. And its Nexus brand means it gets frequent feature updates, and offers a "pure Google" Android experience.
At $199 for the 8 GB model, its pricing was already aggressive. But according to Zach Epstein of BGR News, Digitimes is now reporting that a redesigned Nexus 7 may be in the works, starting at a price point of just $99. Keeping in mind that Digitimes isn't always the most reliable source of information, and that no $99 Nexus tablet may actually be forthcoming, what would it be like if it actually shipped?
Low-quality components
The first, most obvious way to get to a $99 sale price is to cut corners. The Nexus 7 packs a modern gaming-class Tegra 3 processor, and Google has emphasized how fast and responsive it is in advertisements. But its chassis and build quality are already inferior to the iPad's, and the popularity of the (extremely slow and laggy) Kindle Fire has shown that many tablet shoppers don't put as much importance on quality. A lower-quality processor or lower-resolution screen might help cut down on costs.
Built-in advertisements
One surprise when Amazon's Kindle Fire line was refreshed was that the whole lineup had built-in ads, which appear on the home screen and lock screen. You can pay $15 to have them removed, but Amazon apparently doesn't believe that many people will.
Google's specialty has always been advertising, as the sidebar ads on Google search and Gmail can attest. Right now Google's first-party Android apps are mostly ad-free, but showing similar advertisements might knock a few dollars off of the bill of materials, even if it would probably be less than Amazon's $15 fee.
Tiered pricing
According to iSuppli's teardown, the difference in cost between the 8 GB and 16 GB Nexus 7 models is only about $8. But the higher-end model costs $50 more, giving Google a "modest profit" compared to the "break even" price on the 8 GB model.
That "break even" price suggests a $99 tablet is probably still a ways off, despite falling component costs. If it ever appeared, though, it might exist mostly to draw attention to a higher-end model. Buyers would be lured by the low price tag, then note that the tablet's not very full-featured and look at the next most expensive model. This already happened when the Nexus 7 launched this year; the more expensive 16 GB model quickly sold out, because the Nexus 7's memory is not expandable and people wanted to make sure they wouldn't run out of space.
Google may have learned from this lesson. Although given that another reason the Nexus 7 may have sold so well is because of its high performance and high quality, putting it nearly on par with the iPad, the "$99 Google Nexus tablet" may either be a completely different class of device (like a touchscreen e-reader) or may simply be a far-fetched rumor for now.
Jared Spurbeck is an open-source software enthusiast, who uses an Android phone and an Ubuntu laptop PC. He has been writing about technology and electronics since 2008.
