Acer, Asus to Introduce Lower-Cost Tablets

Acer's Iconia Tab W500 will run on Windows 7 and features a 10.0-inch display, 2-gigabytes of memory, Radeon HD graphics, and a front and rear cameras. The tablet comes with a detachable keyboard, allowing people to use it as a laptop.

Meanwhile, Asus' Eee Pad Transformer comes in two versions, the 16-gigabyte for $400 and a 32-gigabyte for $100 more. It runs on Android's Honeycomb 3.0, and also boasts a 10.1 inch touch-screen display, 1-gigabyte of memory, Tegra 2 graphics, and a 1.2-megapixel webcam with microphone. Furthermore, the Eee Pad lets users connect to their desktops with Windows 7 remote capabilities.

Acer's tablet, the Iconia Tab W500, will sell for $450 at Best Buy starting April 24, with Asus' Eee Pad Transformer tablet set to arrive two days later at $400.

Besides competing against each other, the tablets must contend with the reigning king of the tablet market, Apple's iPad, which starts at $500. But although Windows 7 OS and Android still lack the smoothness of Apple's tablet OS, lower prices could boost demand for devices that run on these platforms.

The combination of high specs with competitive prices may help Android increase its presence on tablets, much in the same way that it has grown in the smartphone market. While budget Android tablets are already on the market, they've often been on older, less-optimized versions of the OS or featured lesser-quality specs.

Higher-quality Android tablets have rolled out, but often with surprisingly higher prices than expected -- Motorola's CEO had to defend the pricing on its premium Xoom tablet when it was first announced. These models' lower prices may bring Android tablets closer to market expectations and offer consumers a lower-priced alternative.

Whether the new tablets can compete against Apple's iPad remains to be seen. Apple took about 90 percent of the tablet market share last year and is still going strong with 4.7 million iPads sold in the second quarter of this year. While analysts predict the company's lead could eventually slip to Android-based tablets, but either way it will take a while for Apple to slow down.

Motorola's Xoom also runs on Android, but costs a hefty $800 and $700 for the Wi-Fi-only model. This leaves Acer and Asus to compete for customers who want lower-cost tablets.