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Okay, there’s lots to love about the recently announced iPad.  It is pretty close to the “innovative notebook” I wished for back in 2008 when the MacBook Air was announced (read the post).  But since I now know His Steve-ness reads my blog here’s some more advice: It’s the cloud stupid.

People in the tech sector get the “always connected internet” and the iPad is a nice manifestation of this understanding.  However, I think most of the folks in Redmond and Cupertino haven’t internalized the concept in deeper ways; in the way internet startups or mobile phone players think about it.

What to rule (more of) the world and make even a ton more money?

Sell the low-end iPad for $99.  How so? Take a cue from the US mobile phone market and require a two-year contract for MobileMe.  This pretty cool cloud-sync tool would be the standard way to get content from your computer to the iPad.  You could sell it to the public as live backups and if the iPad had a camera (only miss in my book) you could tie iChat to the subscription of internet phone and video conferencing

Today MobileMe is $99/yr and I have to imagine the take rate for iPhone users is low.  If you required it at $19.95/month you would be awash in incremental subscriptions and it wouldn’t be hard to share some of that cash with a few newspapers to sweeten the deal for consumers.  Here’s the deal: you could easily subsidize the hardware price with a subscription plan like this.  And by the way, US consumers totally whiff on the math.  Apple, you come out WAY ahead on this deal.

But wait, there’s more.  The best part?  I haven’t dug through Apple’s financials but I have to believe the iTunes Music Store and the App Store are eye-poppingly profitable.  Selling one more digital copy of a song or app is virtually 100% profit.  So what would a $99 iPad get you here?  Simple.  Thousands and thousands more people buying stuff from your store.  This is the measure internet startups use so often – monitize the eyeballs.

By focusing on the cloud and adding a subscription model to a hardware device you strengthen the solution, broaden the adoption, deepen the grip, and accelerate the success of your closed online store.  Holy cow, Steve, you’ll not only get richer but you’ll rule our digital world.