Google has just unveiled a mini tablet co-branded with Taiwan’s Asus and priced to compete with Amazon’s Kindle Fire device. Google has previously worked with hardware manufacturers HTC and Samsung to produce co-branded Android smartphones under the Nexus brand. The new Nexus 7 tablet would be its first such tablet device. Google only gave the Taiwan PC maker four months to build the product. The task is to build a high-end tablet that could sell for just only US$200. Asus Chairman Jonney Shih said the internet giant can be kind of demanding, their company’s engineers felt it’s like torture …
Shih said that he put his workers closer to Google, and also allowed his engineering team to have a 24-hour development cycle. Even then, he had to add another 20 people to the project. And then another 20 again. Nevertheless, the team have still learned a ton from working so closely with Google’s engineers. Both companies feel they have something that can serve as a full-fledged tablet computer while competing on price with the Kindle Fire. Despite its bargain-basement price, the device packs a high-end laminated display, quad-core chip and other high-end features.
One way the companies managed that is through razor-thin margins. Google is selling the device through its Google Play store, essentially at cost, and also absorbing the marketing costs associated with the device. While that kind of cost structure could make life challenging for any other hardware makers looking to sell cheap Android tablets, especially those low-end tablet that produce by second-tier brands from China. The actual assembling of the Nexus tablet is handled by Quanta Computer, the largest notebook computer ODM company in the world. It is estimated to ship about 3 million to 10 million units by the end of this year.
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