CrunchGear’s Matt Burns last week created a stir when he asked whether Apple “preemptively killed” the U.S. tablet market with its iPad. His argument goes something like this: While iPads are flying off the shelves, no competing device has emerged, leaving Apple to sew up the market before it can mature. “Are manufacturers really going to invest millions upon millions of dollars in R&D and marketing when consumers are buying the iPad by the millions?” he asks.

Sure, it’s a thought-provoking question. But numbers aside, all Apple has really done is create a tablet market that simply didn’t exist a few months ago — one in which there’s still plenty of opportunity for those who can make a better — or cheaper — mousetrap.

The iPad is primarily a complementary gadget. In other words, it isn’t functional enough to replace a laptop, and it obviously won’t replace your smartphone. So the demand for such a device should be relatively small, especially given the starting price point of $500. The iPad’s enormous popularity is more due to the fact that it can do so many things well: It’s an impressive gaming device that can replace consoles for simple games, and ideal for individual video consumption. Its touchscreen and Safari browser make surfing the web easy and it can serve as the hub of a home music system.

But none of those qualities are unique to the iPad — any similarly sized tablet could offer the same ones easily. Effectively, all Apple has done is create the tablet market and then, through an effective marketing campaign, shown users exactly what that particular device can do. A new tablet running a competing operating system could actually outsell the iPad if it could address a few of the following shortcomings:

• Flash support. Adobe’s technology is everywhere on the web; that’s painfully obvious to iPad users. While the Internet is unquestionably moving toward HTML5, surfing on the iPad means accessing only part of the web. Full support for Flash would be a huge competitive advantage for a competing device.
• A lower price point. There’s no question that the iPad’s price of $500 and up has kept it out of the hands of many would-be purchasers in this brutal economy. A recent study from Boston Consulting Group found that while 49 percent of respondents worldwide planned to buy a tablet or e-reader in the next year, Americans overwhelmingly said they wouldn’t spend more than $200 for such a gadget. There will be plenty of low-hanging fruit for vendors who can bring a device to market in that range.
• Better integration with Microsoft Office. The $15 app Documents to Go works fairly well in enabling users to create and edit Microsoft Word, Excel and PowerPoint documents on the iPad, but a lack of support for email attachments and other shortcomings can be a pain. Microsoft has a real opportunity here to deliver an iPad-like tablet running its Windows Phone 7 that would give business users full access to Office functionality.
• More hardware bells and whistles. The iPad lacks any sort of camera — video or still — as well as removable memory, and its optional keyboards can be awkward to use. A messaging-centric tablet with a webcam and attached keyboard could find a sizable audience as video chat gains traction, especially among younger users. And a more traditional setup could be a comfortable format for users unaccustomed to using a touchscreen interface.

Just as it did with its iPhone, Apple has done a remarkable job of creating demand for devices and services users may not have even known they wanted previously. Now it’s up to Cupertino’s competitors to improve on the iPad and prevent Apple from owning a space that didn’t exist just a few short months ago.

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