Are you seriously comparing an iPad to a Nook Color?
Nook color full specs:
Processor: ARM Cortex A8-based Ti OMAP 3621 @ 800 MHz (same processor as Droid 2 and Droid X) GPU Processor: PowerVR SGX530 Graphics Rendering: Open GLES1.1/2.0 Hardware Scaling: 854x480 scaled to 1024x600 Video Formats: .3GP, .MP4, .3G2 Video Codecs: H.263, H.264, MPEG-4, ON2 VP7 Image Formats: JPEG, GIF, PNG, BMP (same GPU as Droid 2 and Droid X) RAM: 512MB Hynix H8MBX00U0MER-0EM MCM (Stacked Chips 2x256MB each die mDDR) Internal Flash: 8GB Sandisk SDIN4C1-8g Removable Flash: 32GB via microSDHC Connectivity: 802.11b/g/n Security: WEP/WPA/WPA2/802.1x Mode: Infrastructure Display: 7" 1024x600 IPS Display w\VividView Cypress Semiconductor TTSP Gen 3 (TMA340) Touchscreen , kernel driver , reference LG Display LD070WS1 (SL)(02) LED Backlight Pixels per Inch: 169 Aspect Ratio: 16:9 Colors: 16 Million Viewing Angle: 178° (same as HTC 7 Surround and HTC 7 Mozart) battery Battery Life: ~8 hours Micro-B USB 2.0 High-Speed Accelerometer
So B&N is able to deliver a device with matching specs minus smaller display for $250 less than iPad. I am not counting magic or experience anywhere - we are talking about concrete stuff like hardware components here - with Honeycomb we could argue that it is possible to ship a iPad alternative with better hardware and equal or better software for $499.
But there's a larger point to be made in that I think your comments reflect a common attitude among many nerds - this obsession with specs. Most consumers don't make purchasing decisions based on a giant list of specs. Maybe you feel they should and they're stupid for not doing so, but that just isn't the reality of the market. And many manufactures, as well as Google, are starting to realize they simple can't put a faster processor and more memory in their products and expect to compete with Apple. Google in particular is putting a lot more effort in to the "polish" and overall "experience" of using Android devices. I know these are dirty words for some, but they reflect the market realities of how consumers make purchasing decisions. And I think it's a good move that will help Android increase it's market share even further.
What I am pointing out is that it is possible to produce and sell a device that can compete with the iPad on specs and experience - the original article said nobody else could sell a device matching the specs of the iPad at $500. It clearly is possible and with Honeycomb improving the experience the software part is also covered - mostly for free to Android tablet device makers.