Here’s why:

AT&T as the only carrier
AT&T SUCKS!  Need I say more?  Those Verizon commercials about AT&T are all 100% correct.  AT&T’s 3G coverage is sad, Verizon’s is amazing.  Until AT&T is gone, the only version I’ll ever get is the WiFi only and use my MiFi 2200 on Verizon for data on the move.

No front-facing camera
ALL of Apple’s computers and monitors come with webcams these days, even the iPhone has a camera in the back.  Why did they not do this? AT&T probably had some say in it, because they SUCK so badly, and wouldn’t be able to handle video conference over 3G.

No Multitasking
They touted this device as something “better” than a netbook, yet it cannot even multitask like a netbook.  ANY netbook is better than this device for this one simple feature.  This feature is “crucial” for a multi-function device like this for it to have any kind of usability outside of basic apps.

The iPhone’ish Operating System
I would’ve preferred something more of a hybrid between the iPhone OS and Mac OS X, I know that would’ve probably required more power and therefore shortened the battery life, but add only 1-2mm thickness and a lot more battery could fit in if shaped correctly.  Having a “fuller” OS probably would’ve solved the multitasking issue and would allow people to run more apps therefore making it that much more of a “usable” device.  Even with this robustness, it would most likely NOT cut into the Laptop market since it doesn’t have a mouse and sometimes you just need a mouse.

No Removable Memory Options
Apple should have simply created 2 versions, a WiFi Only and a WiFi+3G, have some onboard memory, maybe 16 or 32GB, then allow us to expand with it SD cards.  SD Cards are getting bigger all the time and would allow much greater flexibility for expansion.   Of course that would cut into Apple’s profit margins when they want everyone to buy the 128GB version coming out next year.

More Codecs
As much of a “media company” as Apple is, they still need to support the needs of the public as a whole.  Everyone, or at least most, has DiVX AVI or MKV movies that they’ve downloaded or gotten from friends.  It would be really nice if these videos could be natively viewed on this device.

Overall, complaints aside, it is still a nice device.  For the price, it’s still, in my opinion, a much better value than the Amazon Kindle line.  The Kindle is too “plain jane” and black and white while the iPad is the Kindle’s hot younger sister that still has some growing up to do.

I will watch the iPad over the next year or so and if they do make some of these improvements, especially the carrier, multitasking and front-facing camera, I’ll buy 2-3 for me, the kids, and around the house.