...they have to be cheap.* (And WiMax has to be available, of course - obviously Taiwan must be planning a push, but s/WiMax/EVDO or GSM_equivalent anywhere else). They also have to be able to bridge - serve as a pocket/portable AP for all your "legacy" devices that support 802.11 that you don't want to buy a dozen individual WAN cards or bridges for.

Slap a screen on it and let it do some basic browsing, why not? Stick a microphone and speaker in it and let it be a phone, why not? That's... not much more in component cost, and your chipset probably already has the pins for both anyway (or you aren't saving any money if you design for one that doesn't).

Nice astroturf on the Zii (srlsly - I hadn't heard of it); it has just about the right form-factor, if they can get the price down to $199 retail it'd be worth considering, and at <$150 it would be a no-brainer.

*There are a couple different niches here. There's "grandma" / etc. who just wants an appliance, probably with a bigger-than-pocket screen. There's "you," who generally either wants something in phone-shape or with full-laptop grunt, but would probably keep a couple it-does-the-web tablets around if they cost $50 and worked anywhere. Then there's "Business," which can have its own goofy and unique needs in the field - most tablets are being used like portable 3270s, y'know?

The problem is positioning, and nearly everyone has sucked at it except for Apple [because they're Apple, and people naturally Wanted to Believe the iPhone], and Amazon, who somehow convinced enough dead-tree reviewers that they were hip and with it if they got a Kindle [and knew they'd reach their target market through those reviewers - little old ladies who tear through five mystery novels a week, and other book reviewers obliged to keep reading and turning in book reports to get their pay].

Palm screwed it up a couple years ago when they came up with the idea of pairing an underpowered laptop with an underpowered smartphone [but couldn't make the laptop come out cheap enough compared to an actual_laptop that it felt like just adding a big display and keyboard to your phone]. Others keep making similar mistakes. I suspect that Intel is keeping the MID around to be sure commodity "tablet-like" hardware will be available to undercut single-source providers when corporates go shopping [and keep them on x86, as opposed to MIPS or whatever]... and to have lots of "shovel-ready" hardware on the shelf when electronic medical records get mandated. (Never mind that those customers are already buying Intel-powered tablet PCs anyway... As the past decade of personal computing has shown, it always helps to have the same-damn-thing packaged as the next-big-thing, lest someone else do it first.)

Does anyone really want these? I mean netbooks are currently the new hot thing but normal laptop keyboards are bad enough given their flat design and netbooks are even worse unless you have the hands of a 8 yr old. Now imagine how horrible these are gonna be given they're about halfway between a netbook and smartphone. In otherwords the keyboards, if they even have them, are a little too big for thumbs but not large enough for anyone over the age of 3.

Beyond the issue with usage there is the question of focusing on WiMax. I don't doubt that WiMax will eventually be widely used but as it stands now it's even less standardized then the 802.11n draft which is several years beyond it's originally planned standardization date. Proof of point I personally know of atleast 6 different signal ranges that WiMax works on so there is no guarantee your hardware will work on all the networks. Honestly it's kinda like gsm cell service, great if you have a quad band phone but if you only have a tri-band or even worse a dual-band phone you're might be without service on half the planet.

Anyway if it was me given the wide availability of unsecured wi-fi you can leech off of to check your e-mail on the go I would rather spend less on a Zii Egg once they are past the beta dev only phase and in the process get a camera, gps and mp3 player. Not to mention the Zii Egg is pocket size while these aren't.