But it barely creates a ripple – the real push is on XBox Natal

Steve Ballmer palming Microsoft slate

Despite speculation in the media that Microsoft would announce an Apple-beater, the announcement by CEO Steve Ballmer of a Microsoft tablet computer was almost off-handed at Wednesday’s keynote speech. The real excitement was in the XBox Natal announcements with its 3D interactive input mode.

Yes Microsoft would have a tablet or keyboard-less computer. Yes it would run Windows 7 and HP would be their partner. Actually. Ballmer presented three units one from HP, and two others from Archos and Pegatron

Balmer did talk up their success with Windows 7 – fastest growing OS sales by year end.

Tablet or slate computers have been out for more than a decade and seen little success except in specialized applications like medical and logistics where an application is built around the hardware. I saw nurses entering data with tablets yesterday at the day surgery but what for? We still filled out at least 8 forms to get me in and out in 2 hours.

The real action is in moving more people onto the X-Box Natal platform. Microsoft aims to make computing as simple and as fun as possible and expand their markets to the billions of people who are not yet computerized. Here Microsoft has traction through product acceptance, pricing and marketing to the consumer.

The tablet market is not going to be a big hit is our prediction. First, Apple’s $1,000 price tag is so close to a real laptop that people will go for the laptop. More for less is always a good formula for consumers. Sure Mac-heads will want one to show off but that’s not a big market like iPhone which has appeal across old market boundaries.

Those tablets from Microsoft look like demonstration products. Microsoft will ship them with their partners and maybe sell $100 million in a few years. In the meantime, they will sell $10 billion+ of the XBox Natals.

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