Are they kidding?

OK, no, they aren’t. Apple’s new iPad has the potential to be at the center of the biggest business change ever, anywhere. And the way Apple announced the device yesterday is all the proof you need of that. So the question is: will it work?

Let me start as I sometimes do by tipping my hat to David Pogue of the New York Times. As usual (I’m so bummed that the phrase “as always” no longer applies), David spoke as the voice of reason: we really haven’t seen the Apple iPad in action or put it through its paces, and in some regard should withhold judgment. Fair enough. But it’s exactly that point on which the iPad needs to be judged.

So, technical reality: The iPad is nothing more than a giant-sized iPod Touch. Let me say as I have before that I think the iPod touch, though not my cup of tea, is an amazing device. But using an iPod Touch isn’t the same as using a computer for the simple reason that you have to back out of whatever task you are involved in whenever you wish to start another. It seems that the iPad will “save your place” in a way that the iPod Touch doesn’t, but the overall experience is . . . clumsy. This is no Macintosh. It’s not even as good as a Windows machine for getting serious work done. No matter what Apple tells us, the iPad is not a “real computer”.

Take that and reduce the issue to this: when you buy an iPad you are getting an iPod Touch at approximately twice the price. It has a big screen, so that may be worth it to you. The geek in me stops right there. Now let’s talk business change.

If you add $130 to the price of your iPad, it will also become a phone—or once again, a giant-size version of another Apple product, the iPhone. Now we’re getting somewhere. Forget about how you won’t be able to hold this thing up to your ear, and the became-ubiquitous-way-too-fast MaxiPad joke; add a Bluetooth headset, and you have an iPhone. I’m not sure many people will want to carry their iPad with them 24/7 the way we carry cell phones and SmartPhones, but time will show us the answer to that question. Here’s what’s amazing, and may represent real business change in a way that Google’s Nexus One fails to: there’s no contract.

That’s right. $130 buys you a phone, and if you choose to buy a GSM model you can—in theory, anyway—activate service with whatever carrier you want, pay as you go, deactivate service, and switch carriers whenever you wish. This is a big deal; it will makes business change for Apple, cell phone companies, and you, and the price is reasonable, if not great. In other words, you pay for the device up-front and add the phone instead of your phone carrier subsidizing the phone and owning you for two years.

Here’s that “how do we judge the iPad right now?” moment: Apple hasn’t quite figured out how any of this is going to work.

Notorious for never pre-announcing products, firing employees who leak information, and having new products on sale immediately after they are announced, with the iPad Apple has told us about its new baby months ahead of the device’s actual availability; best estimates are that the iPad will be available in March or April. That’s what’s huge about the iPad: you can’t have one.

In fact, Apple’s web site says they haven’t even received approval for the iPad from the FCC. They can’t sell you one yet. Technically, they can’t even do much testing. The iPad as it’s been described in the only version that (might) matter doesn’t exist!

The iPad with Phone isn't available and has no FCC approval

So there you have it: the Apple iPad is an expensive iPod Touch that you can’t have, and that may make for huge business change one day—but not in the ways Apple is talking about. To be frank, the iPad feels like not just a giany iPod Touch, but a giant scam.

I’ll be keeping my Droid.

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