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  1. gbp
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    #81  
    Quote Originally Posted by SnotBoogie View Post
    you're the exception.

    i have none of those. & again you're the exception. The touchpad cost $318 to build. even if you bought $100 in apps and $30 in music it still doesn't make $99 profitable. And Most people are not spending that much. I've bought no music and 1 app in two years. I don't own a touchstone or single accessory. My mother, brother, his two kids, His wife have bought two phone cases between them. Total. They only use free apps. Apps are great buy they are unlikely to make up the shortfall you're talking about with $99 or even $200 devices.
    I would say you might be correct on recouping 200 dollars, but you are missing the point about accessories. While you don't own any touchstone, there are many who spent 40 dollars on a touchstone. And about 90% of the existing owners purchased a case. You are talking $ 60 dollar additional revenue of which $30 will be profit. My point is that HP can find ways to make money elsewhere rather than saying "we give up".

    Further more I would dispute the BOM number on TP is $ 300. The bozos who calculate these numbers have no clue about how much HP pays in bulk. The price changes for product / product , customer/customer and based on the quantity of order. Talk to anyone in the supply chain at Apple. They will tell you the stories about how Apple uses its scale to lower the price of components. I would go out on a limb and say the BOM number can be 10-20 % low. Which will result in a TP for $ 240.00 - $270.00 range.
  2. #82  
    Quote Originally Posted by CGK View Post
    With the way cycle times are increasing, it is not likely to be that longer maybe 3-4 years. The big question left this generation is who will be 3rd or 4th - WebOS isn't a bright new prospect anymore it's been around for three years now with very limited impact and currently has no hardware base - can't see how it can come back at this stage especially given the current vagueness about its future. Lots harder the second time around to convince premium developers and partners to give your sales bomb another chance.


    Sent from my touchdroid using Tapatalk
    That's better.

    I totally agree with you on webOS' outlook. If HP keeps it, they got to throw some considerable muscle behind it and not let up. Developers may still be in this. We keep getting good big name apps every other week now. Way more than we got under Palm. HP can turn this around if they start producing good hardware again.

    Your last sentence is what makes the subject of this thread ridiculous to understand. Microsoft has failed miserably in the mobile sales market from the beginning and still fails to this day. Their only bright spot was Windows Mobile 6, but it was short lived. Why do developers and partners still trust them in the mobile space, especially after the whole Kin fiasco? Their power has always been on the desktop. They are toothless in the mobile arena, unless you use Android, where they make more money off Android devices than some of the hardware makers.
  3. #83  
    Quote Originally Posted by gbp View Post
    I would say you might be correct on recouping 200 dollars, but you are missing the point about accessories. While you don't own any touchstone, there are many who spent 40 dollars on a touchstone. And about 90% of the existing owners purchased a case. You are talking $ 60 dollar additional revenue of which $30 will be profit. My point is that HP can find ways to make money elsewhere rather than saying "we give up".

    Further more I would dispute the BOM number on TP is $ 300. The bozos who calculate these numbers have no clue about how much HP pays in bulk. The price changes for product / product , customer/customer and based on the quantity of order. Talk to anyone in the supply chain at Apple. They will tell you the stories about how Apple uses its scale to lower the price of components. I would go out on a limb and say the BOM number can be 10-20 % low. Which will result in a TP for $ 240.00 - $270.00 range.
    Thank you!
  4. #84  
    Quote Originally Posted by safeguard3 View Post
    Even by your calculations, HP still loses a ton on each TP at the firesale price and can only perhaps aspire to break even at a $250 price not including advertising, etc.
    Yes! This is what gets me when people claim that HP would "only" lose $200 per TP at a $99 price point -- they assume that the parts are the only expense, as if they are built for free, packaged for free, stored for free, shipped for free. As if the R&D was free, advertising is free, tech support is free, warranty repairs/replacements are free, and the highly skilled, highly paid people who develop and maintain the OS work for free. Mix this with the fact that, compared to Apple, the number of tablets produced and sold is small (around 500,000-750,000 versus god-knows-how-many iPads), and you have a world in which HP could never ever sell a $99 tablet that wasn't made of paper-mache and macaroni.
  5. #85  
    You can't compare what Microsoft did with the Xbox to the mobile space. The video game market resets itself every 5 years, then spends the next 5 years doing little more than shrinking down the process.
  6. gbp
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    #86  
    I guess we are all losing it here with $99.00 touchpad which is history. Don't expect HP to keep selling them at $99.00.
    The question really is Should HP come back to market with a TP2 for higher price or keep trusting Microsoft to deliver their next tablet.

    Its crystal clear that improvising the webOS is less risky than going with unknown i.e. Win8.
  7. gbp
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    #87  
    Quote Originally Posted by jrstinkfish View Post
    Yes! This is what gets me when people claim that HP would "only" lose $200 per TP at a $99 price point -- they assume that the parts are the only expense, as if they are built for free, packaged for free, stored for free, shipped for free. As if the R&D was free, advertising is free, tech support is free, warranty repairs/replacements are free, and the highly skilled, highly paid people who develop and maintain the OS work for free. Mix this with the fact that, compared to Apple, the number of tablets produced and sold is small (around 500,000-750,000 versus god-knows-how-many iPads), and you have a world in which HP could never ever sell a $99 tablet that wasn't made of paper-mache and macaroni.
    First of all the price is not $ 300 , it will be $ 250 range ( probably). The inside details of the supply chain are not known to outsider. The analysts are close to predicting , but not 100%. Your point on warranty is valid in a way its additional cost. The rest can be scaled with their PC group. Advertising, tech support, shipping, packaging can be saved with the PC business.

    HP can bring back a new tablet i.e. thinner faster TP 2 at $ 299.00 yet break even.

    Read how Apple squeezes suppliers here.
  8. #88  
    Quote Originally Posted by jrstinkfish View Post
    Yes! This is what gets me when people claim that HP would "only" lose $200 per TP at a $99 price point -- they assume that the parts are the only expense, as if they are built for free, packaged for free, stored for free, shipped for free. As if the R&D was free, advertising is free, tech support is free, warranty repairs/replacements are free, and the highly skilled, highly paid people who develop and maintain the OS work for free. Mix this with the fact that, compared to Apple, the number of tablets produced and sold is small (around 500,000-750,000 versus god-knows-how-many iPads), and you have a world in which HP could never ever sell a $99 tablet that wasn't made of paper-mache and macaroni.
    I thought when I read the report that the manufacturing costs were included in the price. Those highly skilled people who develop the OS were suppose to develop and maintain it for several devices (TouchPad, Pre3, Veer, Toasters, Printers, etc.). You are going to lose money up front having those folks on staff since HP was essentially starting from scratch with their device portfolio. You can't (or shouldn't) look at your first device in the product line and decide that since it is not doing well, give up. You will never recoup those costs with that strategy. Do you think that Samsung became the #1 smartphone maker with just one phone?

    The advertising folks don't just advertise for the TouchPad. There is no shipping fleet at HP dedicated to just shipping the TouchPad on it's (the TouchPad's) on trucks. The revenue that drives these sections are taken from all HP sales, not just TouchPad sales.

    Bottom line HP should have known how much this stuff was going to cost at the beginning. Still the loss was a lot less than what happen to their stock and a lot less than the Autonomy buy. BTW, it was HP's dumb and brilliant idea to dump the TouchPad at $99-150. They could have dropped the price to $250-300. BestBuy also decided not to offer the rebates for the TouchPad to their customers, which sank their sales and gave Leo the excuse (yes, excuse) to dump the whole hardware division. The TouchPad was just a scapegoat for the Autonomy deal that backfired.
  9. #89  
    Oh, and before anyone says you can't sell the TouchPad at $250, my family has two $250 TouchPads (my wife and my mom's). My wife wanted one for $150, but everyone sold out so quickly I couldn't get one. After searching for 4 days my wife, who is a level headed non-tech junkie, told me to get her one from Ebay. Luckily Amazon was still selling them for $250 so I bought it there. I took mine to my parent's house on a visit. My mom like it so much she wanted me to get her one. I tried to talk her into getting a Kindle Fire, but she didn't want that. My dad ordered her one on Amazon also. Way better deal than the Fire on paper, but I am concerned about future support like everyone else. None of us would have $700 for the Slate 2.
  10. cgk
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    #90  
    Quote Originally Posted by gbp View Post
    First of all the price is not $ 300 , it will be $ 250 range ( probably). The inside details of the supply chain are not known to outsider. The analysts are close to predicting , but not 100%. Your point on warranty is valid in a way its additional cost. The rest can be scaled with their PC group. Advertising, tech support, shipping, packaging can be saved with the PC business.

    HP can bring back a new tablet i.e. thinner faster TP 2 at $ 299.00 yet break even.

    Read how Apple squeezes suppliers here.
    Apple squeezes suppliers because it is willing and able to put down billions of dollars on the table when negotiating contracts, they also do other things like spend billions of dollars on data centres years in advance of actually needing them (they started building icloud data centres in 2008) - they have $50 billion in cash for a reason, for all its scale HP is unwilling and more importantly unable to do the same. Largely because it cannot shake the mindset it developed as a bottom dollar grey box shifter which is based on high volumes, low margins and investing as little as possible. In 2011 going into 2012, the OS and the devices are in some respects the cheapest bits of the business, it is the infrastructure that is where the real money is being spent. Take one aspect of iOS, that of siri, from all accounts, apple is spending serious amounts of money on the backend for data centres.

    I don't see what has changed at HP to say that they are willing to invest those amounts of money on a risky prospect like bringing WebOS back as a consumer OS. Same problem exists for any licensing partners.

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  11. #91  
    Quote Originally Posted by passlogix View Post
    Customer already decided not to buy webOS device. They failed on Veer and TouchPad. Windows product, they know it will sell.
    That's a stretch.. in reality what customers did was refuse to buy the over priced touch pad on release, not a hardware or OS thing.. but it simply didn't have a large mature app market. Most consumers felt if they were paying that much why not get the ipad? HP needed to use a little common sense here. If HP invested some money and had a good (multi-year) strategy they would have sold the equipment at a loss grow the base and made money on the software and in other areas (funny enough the fire sale accomplished this). The best thing is HP is soo ignorant they still can't figure out how to make money and keep webos hardware/software going and they actually have the second largest user base of any tablet now. There really is a large hole for these devices at a 200-250 price point (watch amazon fire sales) but going head to head with the ipad? LOL, What ****** in HP made this concious choice..
    Last edited by stumblinh; 11/05/2011 at 08:38 AM.
  12. #92  
    Quote Originally Posted by k4ever View Post
    @SnotBoogie
    I suggested in a thread I started at the beginning of the fire sale that HP produce at least 4 more runs of TouchPads at the reduced price and take a $500 million dollar lose. It would take a long time (over several product lines) to recoup those loses, but it would be worth it in the long run to produce a solid user base and grow the webOS brand.

    My bottom line with this is that HP's losses on the TouchPad to gain market share would be way less than Microsoft's loses on the Xbox to gain market share, yet everyone sees Microsoft's move as a more viable business option? I don't understand that at all.

    The Autonomy buy was completely stupid. They thought it was more viable to spend $10 billion in cash up front to compete in a market with more established players that doesn't threaten their core business than spend another $1-2 billion to gain a foothold in a market (mobile) that does threatens their core business? How long would it have taken to return to profitability on that $10 billion buy plus the cost of establishing the HP brand in that market? Still longer than it would have taken to absorb the cost of making webOS a major player in the mobile market.

    The Windows Tablet move is stupid in that it doesn't help HP as much as it helps Microsoft.
    Microsoft could lose 7 billion dollars when it has 50 billion sitting in cash. HP has around 2 billion in cash.

    You want HP to take a 500 million dollar loss on touchpads? They were about to take that much every quarter. HP makes like 6 billion in profits a year. But if they take a 500 million loss per quarter how do you think the shareholders will react? Eating up like 1/3 of the yearly profit? That would never fly and there is currently zero indication that your 500 million dollar loss would translate into more users that will pay a profitable price down the line. You'd be expecting people that bought a cut price tablet to, for the next year's model, fork over for a full price updated version of something they largely only wanted at a cut price. Not gonna happen.

    4 more runs? They did one run of a million and said they lost $332 million and that number was going up? So you want 4 more runs at losing $500 million dollars each just to try and seed 4 million touchpads to people many of which are gonna buy it to put android on it or just cause it's cheap? That strikes me as a recipe for financial ruin.

    Regardless you can parse it anyway you want but phones and video game markets do not work the same no matter how much you want to make it. Microsoft isn't losing money on every console now. And they have vastly more revenue streams then HP has with phones not to mention they had an enormous cash position to fund losses. HP does not.

    If people buy HP tablets it helps HP. The same as it helps HP if people buy Windows laptops or desktops.
    Last edited by SnotBoogie; 11/07/2011 at 03:53 AM.
    You come at the king. You best not miss.
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  13. #93  
    Quote Originally Posted by gbp View Post
    I would say you might be correct on recouping 200 dollars, but you are missing the point about accessories. While you don't own any touchstone, there are many who spent 40 dollars on a touchstone. And about 90% of the existing owners purchased a case. You are talking $ 60 dollar additional revenue of which $30 will be profit. My point is that HP can find ways to make money elsewhere rather than saying "we give up".

    Further more I would dispute the BOM number on TP is $ 300. The bozos who calculate these numbers have no clue about how much HP pays in bulk. The price changes for product / product , customer/customer and based on the quantity of order. Talk to anyone in the supply chain at Apple. They will tell you the stories about how Apple uses its scale to lower the price of components. I would go out on a limb and say the BOM number can be 10-20 % low. Which will result in a TP for $ 240.00 - $270.00 range.
    I trust their numbers more then your numbers. You're pulling stuff out of the air. They at least are using actual component prices.

    No matter what way you slice it. They are still losing money. That's the problem. You guys don't care in the slightest if they don't make money. But it's a business. It has employees with families to pay, it's got shareholders to satisfy. And it doesn't have a ton of cash. It's utterly unrealistic to think they can just take massive losses. Just cause you give a bunch of people a 99 buck touchpad doesn't mean they are gonna go fork over $200 on accessories. If most of the buyers had $200 to spend on accessories i doubt they'd really be buying a cut price tablet in the first place. There reason they are shopping at that price point is cause they don't want to spend more money.
    Last edited by SnotBoogie; 11/07/2011 at 03:43 AM.
    You come at the king. You best not miss.
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  14. #94  
    Quote Originally Posted by SnotBoogie View Post
    Microsoft could lose 7 billion dollars when it has 50 billion sitting in cash. HP has around 2 billion in cash.

    You want HP to take a 500 million dollar loss on touchpads? They were about to take that much every quarter. HP makes like 6 billion in profits a year. But if they take a 500 million loss per quarter how do you think the shareholders will react? Eating up like 1/3 of the yearly profit? That would never fly and there is currently zero indication that your 500 million dollar loss would translate into more users that will pay a profitable price down the line. You'd be expecting people that bought a cut price tablet to, for the next year's model, fork over for a full price updated version of something they largely only wanted at a cut price. Not gonna happen.

    4 more runs? They did one run of a million and said they lost $332 million and that number was going up? So you want 4 more runs at losing $500 million dollars each just to try and seed 4 million touchpads to people many of which are gonna buy it to put android on it or just cause it's cheap? That strikes me as a recipe for financial ruin.

    Regardless you can parse it anyway you want but phones and video game markets do not work the same no matter how much you want to make it. Microsoft isn't losing money on every console now. And they have vastly more revenue streams then HP has with phones not to mention they had an enormous cash position to fund losses. HP does not.

    If people buy HP tablets it helps HP. The same as it helps HP if people buy Windows laptops or desktops.
    Ok we are not reading the same reports and getting different numbers about how much HP is losing on the TouchPad, which isn't uncommon for this fiasco. What I read stated that HP lost only $100 million on the 800-900,000 TouchPads they were selling at the firesale price.

    HP's $99 ultra low price the TouchPad, loss of $100 million - NewsO/Trade

    I also read that HP had $12.9 billion in cash reserves prior to the Autonomy deal. According to the reports HP spent over $10 billion of that to buy Autonomy:

    Why HP is betting the farm on Autonomy — Tech News and Analysis

    Both markets that HP are trying to penetrate have risks associated with them. HP was/is a bit player in the mobile space vs. Apple, Samsung, Motorola, and HTC. HP was/is a bit player in the enterprise market vs Oracle and IBM. So you are telling me that it is more cost effective and less risky to lose $10 billion in cold hard cash to push yourself into a mature business vs established players than lose $500 million in cash upfront or spread out across a few quarters to establish yourself in an emerging business that is threaten your core business?
    Last edited by k4ever; 11/07/2011 at 09:09 AM. Reason: Clarity
  15. cgk
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    #95  
    So you are telling me that it is more cost effective and less risky to lose $10 billion in cold hard cash to push yourself into a mature business vs established players than lose $500 million in cash upfront or spread out across a few quarters to establish yourself in an emerging business that is threaten your core business?
    Does it matter? The cash is gone.
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  16. #96  
    Quote Originally Posted by CGK View Post
    Does it matter? The cash is gone.
    For this conversation it does. I would love to know why HP thought that spending $10.9 billion in cash on Autonomy was better than spending 1/20th of that amount on webOS? I would also love to know how building a Windows tablet is going to make them a major player in market that has no Windows penetration whatsoever?
  17. #97  
    Quote Originally Posted by k4ever View Post
    For this conversation it does. I would love to know why HP thought that spending $10.9 billion in cash on Autonomy was better than spending 1/20th of that amount on webOS? I would also love to know how building a Windows tablet is going to make them a major player in market that has no Windows penetration whatsoever?
    Yep MSFT lucky to have HP in the mobile space. Sounds like Bradley 100% committed to them. Perhaps part of the deal was to say HP would not make any tablets from any other operating systems or just not make any from webOS and in return, he gets a lower licensing fee or some other goodies from MSFT to help him make up for his razor thin margins.

    But with the increasing consumerization of IT as the buzzphrase goes, will the deal with MSFT prove to be short sighted? Will it be enough?

    At any rate, webOS is left out in the cold. Derek's plea for HP to sell it makes increasingly more sense. I'd like to know also what kind of innovation webOS can pull off now to keep it relevant as the other OS's increasingly adopt its best features.
  18. #98  
    Quote Originally Posted by SnotBoogie View Post
    I trust their numbers more then your numbers. You're pulling stuff out of the air. They at least are using actual component prices.
    I'm giving you the first links that are popping up in Google. Most of this stuff was reported on PreCentral. I will admit that anything on this must be taken with a grain of salt, but you should admit that also. I have not seen a number for the losses or a component cost posted by HP. Will you please provide a link for the entire group to digest? That will help me to understand your point. I have provide links to help you understand mine.

    Yes HP is losing money. Heck, they've lost money everyday Apotheker was CEO. I and others here care about the future of webOS. Right now nothing that HP has said or done makes any since business wise about webOS or tablets in general. Going forward, what is their strategy? Seems to me like they are flapping in the wind right now. They are too busy being a "me too" follower instead of a real leader.
  19. cgk
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    #99  
    Quote Originally Posted by bluenote View Post
    Yep MSFT lucky to have HP in the mobile space. Sounds like Bradley 100% committed to them. Perhaps part of the deal was to say HP would not make any tablets from any other operating systems or just not make any from webOS and in return, he gets a lower licensing fee or some other goodies from MSFT to help him make up for his razor thin margins.

    But with the increasing consumerization of IT as the buzzphrase goes, will the deal with MSFT prove to be short sighted? Will it be enough?

    At any rate, webOS is left out in the cold. Derek's plea for HP to sell it makes increasingly more sense. I'd like to know also what kind of innovation webOS can pull off now to keep it relevant as the other OS's increasingly adopt its best features.
    Why do we keep hearing this conspiracy theory? However we want to cut it - on the day that they pulled the plug on WebOS, it didn't sell, nobody was buying WebOS hardware - it's arguable but unknowable if they could turn it around but it's a fact that upto that point it was a sales flop - that's down to HP. Microsoft didn't kill it, lack of sales killed it.
  20. #100  
    Quote Originally Posted by CGK View Post
    Why do we keep hearing this conspiracy theory? However we want to cut it - on the day that they pulled the plug on WebOS, it didn't sell, nobody was buying WebOS hardware - it's arguable but unknowable if they could turn it around but it's a fact that upto that point it was a sales flop - that's down to HP. Microsoft didn't kill it, lack of sales killed it.
    Because they killed it a month after the initial sales launch and right after they changed their pricing strategy and after making it a star at their big enterprise conference just a month prior to launch. Didn't the Kardashian (sp?) marriage last longer and seem more consistent?
    Don't you have to roll out an electronics product and then take a little time at least to have it catch on instead of treating it like a network pilot? Should we have canceled the CD player, for eg. right after launch?

    Because Bradley seems 100% committed to MSFT tablets and why does he sound so final about no webOS tablets for the new lineup, especially as win8 is yet to come out? Why doesn't he commit to a diversified line that includes the webOS software that his company owns, especially as it got a lot more converts and positive publicity post-Leo debacle?

    edited for clarity
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