The market will be:
-All those people that can't read an Ipod.
-The elderly.
-First time computer buyers.
-Anyone needing a second machine in their home in order to prevent fighting over the primary machine. I would have bought an Ipad in a flash over the $500 laptop we have that is used only for surfing the net, email and pictures.
-Students.
-The techies.
-The homemaker - perfect for recipes and looking at pictures of beautiful flowers. Also a good solution for those who tend to lose small things.
-Forum junkies.
-Faceless Bookers.
My bet is these are a first generation machine that will be vastly improved upon. There is a bunch of improvements they could make to it such as flash, voice recognition and projection screens but I'm sure Apple wants to go through a few generations of Ipad too.