For consumers that can afford it, tablets may replace a lot of what a desktop computer does for those people, but there are many people who are lower income who will still depend on very inexpensive desktop computers, either ones the own individually or (more likely) ones that they can access at their local library. I think Ubuntu is heading in a direction where it will replace Windows for users that only need an office suite and a web browser but need to use a cheaper desktop machine.
I think it's much more likely lower income people will use a smartphone as their primary computer than a desktop machine. Cell phones already have incredible penetration, and the cell companies (not to mention Google) are going to push smartphones into that population in short order.
I agree. Everybody will have a smart phone because they're so useful and for a lot of people that will be all they need, particularly if money is tight. I'm in Vietnam now and most people here make next to nothing but they still have smart phones and I even see a lot of iPhones, even though they cost a fortune by Vietnamese standards.
I see a fair number of cheap desktop computers too but they're all running bootleg copies of Windows. People aren't paying for their software anyway so the price advantage of Linux is negated.
A second thought: Linux might be able to compete on the basis of security. Every single Windows machine I've used here has been riddled with trojans and viruses. I have a feeling this is common in a lot of the developing world.