I can't figure this out, mostly for one reason: With a device like this, since it's not a phone, and it doesn't have SMS capability, why can't it have expandable memory?
There's no way I'd pay $100 for 16 more gigs of memory, or $200 for 48 gigs. That's just a rip-off. Since you can't easily type on it, forget using it for anything but large-size iPhone on the internet. The iPhone does well for clicking-based stuff, but really doesn't work for typing, unless it's a last resort.
So I'd really find it useful for a few things: A media device, naturally. Mostly for videos. Except it's actually very expensive compared to laptops that could do the same but have more memory. Then there's apps. There's an app for everything, I know... Except more often than not, apps do about the same thing as a decent internet browser with few bookmarks do, don't they? While apps are a selling point, they're really not that great of one.
The last idea is books, right? Use it as an e-reader, if I understand. But how long does the power last with that? I suppose that's a non-issue, though, it's big enough you might just get used to treating it like a normal laptop, and just not use it like people use cellphones or other e-readers.
Truthfully, I can see people using it in a way that isn't intended. By design, though not cost, wouldn't it make an awesome all-in-one remote? You'd have to figure out how to make everything work with wi-fi, but imagine it controlling your house's lights, fans, televisions, dvd players/multimedia devices, and so on.
But as a stand-alone device? It seems a bit lame and expensive.