Google's Nexus 7 is selling extremely well. According to the company's Google Play online store, the 16GB, $249 Nexus 7 is currently sold out. The cheaper $199 version is still on sale, but local retailers are saying that supply is not currently matching demand. It's a major issue. And it underscores the popularity of Google's tablet and resurgent growth of the 7-inch slate market in general.
Should Apple be concerned?
Despite the Nexus 7's success, the chances of it becoming dominant in the tablet market are slim. The device is certainly nice and consumers are obviously excited by it, but it has a number of shortcomings that can't be solved so soon. What's worse, there's a chance that Google might not even want to solve those problems. The company is simply too focused on advertising and Android to truly care about a single device's success.
1. The 7-inch display
The 7-inch display is obviously popular, given the Nexus 7's sales. However, no 7-inch tablet has come even close to matching Apple's iPad in terms of overall sales. The issue is that the display is too small for enterprise users and since it typically comes with less-powerful components, it doesn't appeal to many consumers.
2. Long-term hype
The Nexus 7 has all the hype it can hope for at this point. But over time, the chances of it maintaining market momentum seem to be very low. Since it is competing in a market niche that appeals to only a subset of buyers, its growth potential is limited from the start.
3. The new iPad
If the iPad didn't exist, there would be a good chance of that Nexus 7 could build up a significant market. But, unfortunately, for Google, the iPad poses an insurmountable barrier to that goal. Even a popular Nexus 7 isn't enough to hurt Apple's tablet sales.
4. The iPad Mini, too
According to several reports, Apple plans to launch a new iPad later this year, called the iPad Mini. The device would come in at a much lower price than the current slate and deliver a 7.85-inch screen. In other words, it'll be a direct competitor to the Nexus 7. And that's bad news for Google.