iPad 2's Biggest Enemy May Be Apple's Subscription Plan

While every Apple fan waits with baited breath for Apple's iPad 2 event later this week, the bigger news already passed earlier this month--one that could have a much bigger impact on the iPad's future, analysts say.

We're talking about Apple's new in-app subscription service written in draconian terms:

Apple's service forces publishers to offer the lowest subscription price for content served up inside an iPad app. The service disallows app developers to send users outside the app to subscribe (although users can do this on their own). Apple takes a massive 30 percent cut of the subscription transaction.

Such a move will likely hurt Apple's image, open doors to the competition, and mortgage the iPad's future. Such stakes underscore the criticality of apps, not hardware, in the tablet wars.

[ Considering the iPad 2? Here are , reports CIO.com. ]

Even if the iPad 2 comes with all the bells and whistles as expected, such as two cameras, thinner and lighter weight, more processing power, more RAM and storage, and a killer price undercutting the new Motorola Xoom, it's still just a minor hardware upgrade. It'll move the iPad only a nose ahead of the competition, and they'll catch up soon enough, analysts say.