If Apple had any doubt when it launched the iPad, it seems clear by this point that competition in the tablet arena will be fierce. Apple will not enjoy the same two year head start it had in smartphones with the iPhone, as upcoming tablets are already raising the bar on the standard set by the iPad.
I don't expect that Apple is necessarily watching what competing tablets are doing and altering its development efforts based on that. For one thing, I assume that Apple already had a vision for the iPad 2 when it launched the original iPad and that development on the next-generation tablet has been chugging along since then. Besides, Apple strikes me as too confident--or arrogant--to consider rival tablets a threat or change its strategy based on what competitors are doing.
That said, competing tablets like the Samsung Galaxy Tab and the BlackBerry PlayBook have the kinds of features that many had hoped would be in the original iPad, and will offer formidable competition for the iPad once they hit the street. In order for the iPad 2 to maintain its edge, or even just remain relevant, here are some key elements it should have.
1. Camera(s). Arguably the most anticipated non-feature of the original iPad was a camera...or two. Not that tablet users want to replace their Nikon DSLR, or even their Sony pocket point-and-shoot with an iPad, but cameras have a variety of useful functions for the tablet. Cameras are a de facto feature of other tablets--both front and rear facing, so Apple needs to add them just to keep up.
2. FaceTime. Video chat is perhaps finally maturing into what it was expected to be 15 years ago. The main problem with video chat now is that there is no standard. One person may use Skype, while the next is using Windows Live Messenger, and another is connected to Google video chat. FaceTime is already present on iPhone 4 and iPod Touch 4 devices, and Apple has set it up as an open standard so that other platforms might use it as well. Adding the millions of iPads to the FaceTime family is an imperative.
3. Processor. ARM recently announced that it has developed a 2.5GHz quad core processor. That isn't expected to be available in mobile devices until 2012, but it definitely signals that single core is yesterday's technology. The BlackBerry PlayBook uses a dual-core processor, and Apple should at least match the processing horsepower of the RIM tablet.
4. Memory. The iPad seems to function quite well on its 256Mb of RAM, but even the iPhone 4 has 512Mb. The iPad has quickly been eclipsed by competing devices with the Galaxy Tab having 512Mb or RAM, and the BlackBerry Playbook raising the bar to 1Gb. Again, Apple's goal should be to set the bar and keep its edge, but it essentially needs to have 1Gb of RAM at this point just to keep up.
5. Weight. With a 9.7-inch display and weighing in at a pound and a half, the iPad is a behemoth compared with the svelte 7-inch competitors coming to market. There are rumors of a possible 7-inch iPad, but hopefully that will be in addition to--rather than in place of--the larger model. Competing tablets use plastic casing rather than metal to shave weight. I don't think Apple should sacrifice construction quality, but it would be nice to shave off a few ounces and come in around a pound.
Those are the must-haves just for the iPad to keep up with where the bar has been set by tablet competitors. Since the pricing details of rival tablets are not yet known, these elements alone might be enough for the iPad to maintain an edge among consumers.
As for the business arena, though, Apple needs to be watching RIM, or maybe even Cisco. While the iPad is very useful as a mobile business computing tool, it's still a little like fitting a square peg into the round hole. RIM has the backend infrastructure for IT admins to manage and protect BlackBerry smartphones and PlayBook tablets, and functions like being able to tether the tablet as a larger display for the smartphone are innovative and useful.
Apple managed to use its leverage as a consumer smartphone to infiltrate the business market with the iPhone, but with tablets it may be the platform that wins the business battle that eventually becomes the default consumer tablet similar to PCs. Users are not going to spend money to buy an iPad if their employer has already given them a PlayBook.