Plastic Logic has once again postponed the release of its e-reader device, QUE proReader, originally due for launch in April 2010. The company’s management cited reasons of product enhancement for the delay. We believe Plastic Logic will have to improve the feature set of the QUE or lower pricing to be competitive with Apple’s iPad.
The iPad has an upper hand over the QUE based on its wider feature set, lower pricing and higher memory. Below we explain why we think Apple’s (NASDAQ:AAPL) iPad may kill the QUE e-reader.
iPad Has Many More Features Than QUE
The QUE proReader, with an 8.5 x 11-inch touchscreen display, has the ability to handle a variety of document formats: Microsoft Word files, PowerPoint presentations, Excel spreadsheets, digital books, PDFs, magazines and newspapers. It can also synchronize with Microsoft Outlook to display e-mail and calendar.
The iPad shares many of the features offered by the QUE but also makes it easy to surf the web, play video games, view photos, watch videos and download apps from the iTunes App Store. Apple’s iPad also features a color screen compared to the black and white QUE screen.
The QUE is targeted primarily at professionals and businesses compared to the wider consumer audience targeted by the iPad. We believe that over time, business customers will find the iPad’s features and price point compelling, and are likely to adopt the iPad for business use. Such a trend has emerged with the iPhone as businesses professionals were initially reluctant to give up their BlackBerries but are increasingly finding the iPhone a useful business device.
Based on the attractiveness of the iPad we estimate that Apple will be able to sell 4 million units in 2010. You can see additional rationale for our iPad unit forecast here. You can also modify our iPad forecast below to see how it impacts the $267 Trefis price estimate for Apple’s stock.
iPad is Cheaper and Has Higher Memory Than QUE
Plastic Logic offers two QUE models: (1) a regular model with 4 GB Memory, Wi-Fi and Bluetooth connectivity priced at $649, (2) a premium model with 8 GB Memory and AT&T’s 3G connectivity for $799.
In comparison, iPad models with Wi-Fi will be available at different price points of $499, $599 and $699 for 16 GB, 32 GB and 64 GB memory, respectively. Premium iPads with 3G connectivity will be priced at $629, $729 and $829.
We estimate that Plastic Logic’s average price is close to $700, while iPad’s average pricing is expected to be about $600.
We believe that additional features, lower price point and higher memory will make iPad a more attractive device to own than a QUE.
For additional analysis and forecasts, here is our complete model for Apple’s stock.
