In the slate/tablet and reader world there are essentially three major competitors: iPad, Kindle and Android. However, in the "waiting in the wings" category we have HP, which has promised to release one or more tablets based on WebOS and perhaps Windows.

RIM is also about to bring out a tablet and Microsoft has vowed not to lose out in burgeoning market either.

A year from now we'll know more, after all these various devices show up and there are a dozen or so modestly priced Android tablets in the market. I predict that "pure" eReaders will fade or entirely disappear unless they're priced very aggressively or seriously upgraded.

Kindle's price is now down to $189 and Kindle DX recently upgraded and the price dropped to $379. Still at $379, DX has very little chance of gaining traction in the market unless it morphs into a more full-functioning tablet. 

But even the original, six inch Kindle won't be able to survive unless it too dramatically upgrades or re-prices itself. That's because there will be a slew of $199 or just over $200 Android tablets. The $199 Cruz Reader is just one among many coming. 

After the dust settles, the iPad is likely to occupy the "premium" segment as Apple does with laptops and desktops. Android tablets will come from many hardware OEMs but they probably won't be able to charge more than about $350 (and maybe even $250). At the bottom of the pyramid will be the eReaders, which won't be able to charge more than about $150. I'm going to speculate, however, that the price ceiling for eReaders will drop to about $100.

(I'm also going to predict that Amazon will eventually build or release its own Android tablet under the Kindle brand.)

It remains to be seen what comes from RIM and HP/Palm. But what Microsoft should do, with its partners, is develop with a fully functioning PC in a thin and light form factor. It would need a full keyboard that can be detached and/or fits nicely into a case. The iPad, while a great device, can't totally replace a notebook for "content creators." 

With the right form factor and capabilities Microsoft (and partners) could probably get up to about $500. And if such a device were to come into being it could be a big hit and also put pressure on the iPad to lower its prices. 

Despite early skepticism, the iPad has "made" the market for tablets just as the iPhone opened the door for the current generation of smartphones. Now, just as they did and are doing with the iPhone, Apple's competitors will be compelled to react and define themselves against the Apple tablet in terms of features and price.