The apps are a bit lacking because there is only so much you can do on a small screen. Try using a large spreadsheet for example.
Bad example and so is word processing.
Tablets and even cell phones have more graphical real-estate than an Apple II or a TRS-80, both which ran Visicalc and we all ran MS Multi-Plan on terminals and Lotus 123 back on old CGA graphics adapters.
Most of these modern little devices easily exceed the old 640x480 or 80x24 text mode which was the minimum standard for productivity workstations for many years. Compare that to a Nexus 4 with 1280 x 768 4.7-inch display and I think it has sufficient display capabilities to be productive, esp. if it was attached to a bigger screen so it's easier to see.
The problem isn't whether these small machines can be used for productivity, it's whether we're too spoiled to use them and the lack of software which Win 8 solves quite nicely by making a common software platform for all sizes.
Anyone see MS Office running on Win 8 cell phone yet? ;)
Anyway, this is off topic as it has nothing to do with the internet which is primarily what people use computer for today and a tablet is a perfectly fine platform for surfing the web with plenty of screen space to be productive, especially with an external keyboard it's equivalent to a netbook.
The whole point of this thread should be not to ignore the changing trends as many websites currently fail to address mobile technology let alone multiple desktop screen sizes with outdated 800px wide fixed width websites. Eww.
What I'm failing to hear is any discussion of HTML5 and responsive design (preferred by Google for mobile sites BTW) which as webmasters is what should be important here to address these changing demographics.