A lot of the focus in the increasingly competitive tablet space has been on the iPad, dominates category sales, and newcomer Kindle Fire, which is expected to sell a significant number of devices at the low end of the market this holiday season. However, Barnes & Noble, which recently made some significant upgrades to its low-priced Nook Color and also offers the more powerful Nook tablet, should not be overlooked.

By adding Netflix video streaming to the $199 Nook Color, Barnes & Noble is more directly taking on Amazon?s similarly priced Kindle Fire. Barnes & Noble could get a boost from reports that Kindle Fire having significant usability issues.

?I have always said that Barnes and Noble is a contender in tablets,? said Sarah Rotman Epps, senior analyst at Forrester Research, Cambridge, MA.

?While the Nook Tablet has better hardware specs, the recent software upgrade is a great improvement to the Nook Color,? she said.

?Having video on it is a key consumer use case, with 58 percent of U.S. consumers that own a tablet using them to watch video. As a result, services like Netflix are a must have.?

Wi-Fi access grows
Consumers love tablets, with many planning to buy them this holiday season. Despite the strong consumer interest, several manufacturers who have introduced tablets have not found success, mostly because their products were too expensive or did not provide a strong customer experience.

Hewlett-Packard is one of these, with the company first saying it would exit the tablet space on its WebOS operating system then later saying it was not sure how it would proceed in the tablet space.

The most recent news from HP is that it will offer WebOS as an open source platform going forward and is considering introducing another WebOS tablet.

However, in the few months that HP has been trying to decide how to proceed in tablets, competition has heated up with both Amazon and Barnes & Noble introducing lower-priced tablets that are primarily used for media consumption, a category of tablets that consumers are embracing.

The growth in lower priced media tablets such as the Amazon Kindle Fire and Barnes & Noble?s Nook Color and Nook tablet is even impacting how tablet users access services, with NPD recently reporting that more tablet owners are relying on Wi-Fi-connections.

Cellular connections are not keeping pace with the growth in tablet penetration as tablets such as the Kindle Fire ? which does not provide cellular connectivity ? hit the market as mainstream consumers choose a lower price over the promise of constant connectivity, according to NPD.

In its latest software upgrade, Barnes & Noble is introducing more than 100 feature enhancements, including access to Netflix streaming video services.

Other enhancements include support for social movie site Flixster and faster and easier access to Barnes & Noble?s digital catalog.

While Barnes & Noble offers a strong product, its success could be hampered by the company?s size in comparison to Amazon.

?There are fewer Barnes & Noble customers, and it does not have as deep pockets but it still put out an excellent product and will sell a lot,? Ms. Rotman Epps said.

Is Fire getting dimmer?
However, the company has some advantages over the Kindle Fire, such as its retail stores.

?While Barnes & Noble has a smaller footprint than Amazon, it has some important assets," Ms. Rotman Epps said. "The bricks-and-mortar store is a great venue to sell Nooks to existing customers.?

Forrester predicts Barnes & Noble will sell between 1.5 million and 2 million Nook tablets this year. In comparison, Amazon is expected to sell 4 million Kindle Fires this year.

The Nook Tablet, which sells for $249, offers an enhanced video viewing experience and better battery life with less weight than the Kindle Fire.

The software upgrade as well as Barnes & Noble?s advantages could boost the Nook?s competitiveness especially as complaints being to surface about the usability of the Kindle Fire.

According to reports, consumers have complained about the lack of an external volume control on the Kindle Fire, an off switch that is easy to hit by accident, an inconsistent touch screen, slow load time for Web pages and the ability easily view what others have been doing on the device.

While Amazon is promising a software upgrade for Kindle Fire in the next few weeks that will address some of these issues, some have suggested that the issues could undermine Amazon?s success in tablets.

Ms. Rotman Epps is not so sure.

?Mainstream customers are quite happy with the device and will continue to be when Amazon upgrades it soon,? Ms. Rotman Epps said. ?It is important to not overweight the importance of the tech press ? they are pickier than consumers.?

Final Take
Chantal Tode is associate editor on Mobile Marketer, New York