preacherman
Explorer
which sells for $99. It was $699 less than two years ago!
with a 2 yr contract and a $30 A month data package.
One of the reasons it's $99 is because apple and ATT have a deal that gives each a piece of the pie. I would assume the tablet will not be subsided by anyone and will therefore remain at a slightly higher cost. (Just like their laptops have not gone down even though more people are buying them and there is more software) When I got my first Mac laptop in 1994 everyone kept telling me "the price will go down when more people start making software for it" I'm still waiting.
My only point is you could make a computer that does everything every small device ever made can do and a large portion of the population will still buy the smaller devices individually. A big reason will be because they can afford a $99 GPS and cannot afford a $2000 super computer. Of course the markets for the small devices will be effected (just look at Palm) but they will never completely go away. A large population of people will buy several sub $150 gadgets from a local Wal-Mart before they will buy a pricey computer from a Apple store that functions better than all the gadgets combined.
If you doubt this show the guy sweeping the floors at McDonald's your iphone compared to his phone and then ask him why he has not yet bought one.