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I'm thinking the demand for Android-based devices will depend on 3rd-party software. If Android can have something like the iPhone AppStore with software that is 100% free/open-source, that should appeal very well to the public. One of the main hurdles of moving to a new platform is to learn what software is available and if Android fails to make this an easy task - it will not succeed because the public just doesn't have time to learn an entirely foreign platform, regardless of hardware quality.
It would be really cool if they can combine the interface of Apple's AppStore, coupled with the functionality of a Linux-based package manager (thinking something like apt or portage). Having a central location to download/install/update/remove software with only a few button presses will definitely be an advantage.
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