input versus price

I was reading today Kevin Tofel's post on jkOnTheRun where he's totally dismayed by the fact that the Archos 9 net tablet runs Windows Starter Edition and thus doesn't have any of the functionality that is included in all of the other SKUs of Windows where there is built-in input mechanisms for pen (ink) and speech.  The result is that Archos had to bundle in a bunch of additional 3rd party tools to give some set of rudimentary functionality for things like a soft keyboard.  For those that don't know, all of the TabletPC functionality exists in EVERY version of Windows except the Starter Edition.  The TabletPC bits gives the end user a whole lot of functionality:

• Soft keyboard
• Text input panel (handwriting and single character)
• Natural speech input
• Gesture support 
• Touch input improvements
• Handwriting optimization tools (let's the system learn your handwriting!)
• Plus more...

So why would anyone who's building a PC-based tablet that is going to ship a version of Windows choose the Starter Edition?  One word ...  "Price".  Microsoft makes the Starter Edition extremely attractive to OEMs since this version is being used as a hedge against Linux -- e.g. Microsoft wants to make the Starter Edition as close to $0 as possible since that's the price an OEM would pay for a Linux distribution.  While this may make sense for those that are marketing a $250 or less netbook, to me this makes no sense at all for a device that's retails for over $500.  The additional cost of the upgraded license for the device is of so much more user benefit than trying to market at the lower price point.

Of course this is just my opinion, but I'm also willing to bet that the majority of practitioners out there who run focus groups or other marketing surveys of users would come to the conclusion that Archos should save the money and get a couple of 3rd party tools rather than paying for the more expensive license.  What?  After having spent a long time with the Tablet PC all the way from the beginning and looking at user value, usability, marketing, technology and the competitive features, the key issues facing adoption of the technology is around recognizing the long term value add.  While there is an initial "wow" around the technology, it's more the subtle things that over time actually provide the unique experiences that users appreciate.  The 3rd party tools also give a lot of the initial "wow" but are relatively superficial and don't have that much behind them.  Thus if I were to say give a demo of the Archos tablet with some 3rd party tools and a demo with the built-in tools from Microsoft, users probably wouldn't monetize the difference enough to justify the more capable version of Windows.  On the other hand, if I found key target users and let them both use the device for an extended period of time (maybe as few as 8 weeks), I'm willing to bet that the users who had Starter Edition would be significantly less satisfied.  I'd also be willing to bet that this wasn't in the research plan or budget of Archos :-) 

However I think this is all a moot point since I'm not relatively bullish on this or any particular UMPC, consumer Tablet, net-Tablet, MID or whatever you want to call them on taking off quite yet (soon, but not now).  I alluded to the reason in this post.  And in the near future I'll talk more about the problem in detail, but in short, it comes down to lacking the necessary services and infrastructure for content delivery and management to make this into a truly compelling consumer experience.  The solution here requires a lot of coordination, but its simplicity will not only benefit users, but make the device a hit.