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Originally Posted by ppw
First the market for the audiences mentioned in your message is small. Even B&N can be successful here, I am not sure how much it can contribute to its bottom line.
Second, once Nook goes Color and LCD, it's drawing additional competitors: iPad and Android pads. The windows for success is very small. Once the price of Android pads goes down to $200-$300 range in two years, single function LCD device will have no market.
If the rumor is true, I feel B&N is fighting two uphill battles. One losing one to Kindle on the e-ink front. One "no long term victory" one on the color front.
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When aimed at children, students, and casual readers, a Nook Color doesn't have to be a full fledged tablet.
Likewise, when tablet prices drop, Nook Color will also drop. Additionally, B&N isn't locked into a color reader. They could just as easily improve the specs and successfully compete with other tablets.
B&N is starting to get aggressive in markets very few others are doing - students and kids (Nook Study and Nook Kids). By focusing on both content and hardware, they're priming themselves to be a dominate and driving force in the future of eEducation.
Also, not everyone needs a full spec'd color tablet. One aimed at content consumption (casual reading, textbooks, children's interactive books, magazines, newspapers, email, music, video, and casual web browsing) at half the price can sell quite well if marketed correctly.