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  1.    #1  
    Someone stated in one of the other threads that HP lost $100 million in the firesale on Touchpad hardware. If that was true, I say they should order at least four more batches of them from Foxconn. Think about it. They only spend 1/2 billion dollars to put webOS squarely in the #2 position for tablets. If they keep the app store open, develops will make money off providing tablet apps to the millions of new customers and HP will be in a strong position to license the OS. They would eventually recoop the money in app sales and licensing. I hate that they killed the Touchpad but it's death could breath life into webOS. For all those that think people are just buying them to put Android on them, think again. Most of the folks who were buying them at my local Best Buy didn't even know what an operating system was. I watched as one guy tried to explain to some folks in line about putting Android on it and they pretty much ignored him.
  2. #2  
    lose a little on every one, and make it up on volume.
    Premium1 likes this.
  3. cgk
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    #3  
    Quote Originally Posted by Cantaffordit View Post
    lose a little on every one, and make it up on volume.

    The size of the loss?

    Sounds like the old gag -

    "how do you make a small fortune?"

    "Start with a large fortune and buy a football team".
    fxspec06 likes this.
  4. #4  
    I hope they burn themselves down in this fire sale. Screw HP.
    thtu likes this.
  5. emuneee's Avatar
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    #5  
    They are Not going to make up the difference with app sales and licensing. For every additional TouchPad they make and sell they lose hundreds of dollars. If HP is thinking of spinning off a division (Personal Systems Group) with positive but thin margins then i don't think they want to lose hundreds of millions making and selling additional tablets.
  6. #6  
    Wasn't it the popular argument with all the locals around here a few weeks back that HP should absolutely sell the TP for the same price as the ipad because selling them for less would set everyone's expectations that webs devices were cheap, while the people suggesting they should sell at lower than iPad prices (but still at a profit) were chastised as being trolls?

    Now conventional wisdom has done a 180 to argue that HP should dump these things at half cost or so to flood the market?

    A lot has changed in a few short weeks.

    -Suntan
    wynand32, fwinst and bbycrts like this.
  7. #7  
    I believe it's called a "loss leader." Sony did this with the PS3 and Microsoft with the XBox. Once people have the hardware, they are locked on that ecosystem and consume the more profitable software.

    The problem with your theory is that it assumes that executives at HP had any business sense whatsoever. They don't.

    My guess is that Leo thought:
    1) Software is more profitable than hardware, so kill hardware (without thinking that hardware is necessary for software to run on)
    2) Tablets OSes are as interchangeable as software - you can just install webOS on a Galaxy Tab
    3) "I get paid for performance benchmarks. Oh crap, Palm GBU is going to miss those benchmarks, and people are going to ask me tough questions on the earnings call. I'll preempt them by saying I'm going to kill it."

    or something along those lines. As everyone has said, even if they were going to kill hardware, there were 10 other ways they could have done this without shooting themselves in the foot. The market cap they lost was 40x the loss on Palm GBU. FORTY TIMES!

    If they had just done a $3 billion securities offering, they might have lost some market cap, but at least they could do a massive loss leader push AND still have money leftover.

    When people <mess> up this bad, they don't usually salvage themselves with better moves later. I don't think Leo is Mitch Kupchak (sending Shaq packing, but getting Pau for a song).
    Last edited by HelloNNNewman; 08/22/2011 at 12:53 PM. Reason: language
    C_McGuire and mysterfix like this.
  8.    #8  
    emuneee, a month ago folks were saying that HP should drastically drop the price on the Touchpad to compete with Apple. They did that. They could have dumped the remaining Touchpads in a landfill. Instead they sold them and people bought them. Most of the original owners like myself who were going to give them up decided to keep them (at the discounted price). HP has said that they would retain the OS and catalog store. Although I don't trust them as far as I could throw them, $150 is not a large price to take a chance on them. If they don't deliver I can always move to Android on the same device. I will dual boot anyway if the option is available.
  9. Kujila's Avatar
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    #9  
    "We thought consumer interest in WebOS was dead, until we destroyed all our profits by selling these for $99.99 ... now consumer interest in WebOS skyrocketed! Woops, now what?"
  10. #10  
    Quote Originally Posted by Suntan View Post
    Wasn't it the popular argument with all the locals around here a few weeks back that HP should absolutely sell the TP for the same price as the ipad because selling them for less would set everyone's expectations that webs devices were cheap, while the people suggesting they should sell at lower than iPad prices (but still at a profit) were chastised as being trolls?

    Now conventional wisdom has done a 180 to argue that HP should dump these things at half cost or so to flood the market?

    A lot has changed in a few short weeks.

    -Suntan
    I think you are misremembering things. People were saying that you shouldn't come out of the gates with a low price (unless you make it clear it is a loss leader). Then they could discount it heavily. Remember the $100+$100 off mini-frenzy? People said HP should learn from that and discount. Maybe not fire sale, but no one suspected at that point that HP had no long-term strategy.
  11. #11  
    Just look at Viewsonic when they dumped off the Gtablet. they sold something like 10,000 in a few days at woot.com and they made promises to support it. 2 months later they dropped there support. The Gtablet was the best selling tablet for a while at Amazon when they also dumped them for $270 . There were probally more users using Gtablets then Ipads for a time. Meant nothing. HP will not make anymore and a year from now most of these tablets will be sitting on a shelg collecting dust . Just my opinion.
  12. #12  
    I'd be willing to bet this topic as been thrown around the boardroom a few times prior Leo <peeing> on the WebOS users. Obviously, we know what they decided on doing.
    Last edited by HelloNNNewman; 08/22/2011 at 12:55 PM. Reason: language filter
  13.    #13  
    Quote Originally Posted by Suntan View Post
    Wasn't it the popular argument with all the locals around here a few weeks back that HP should absolutely sell the TP for the same price as the ipad because selling them for less would set everyone's expectations that webs devices were cheap, while the people suggesting they should sell at lower than iPad prices (but still at a profit) were chastised as being trolls?

    Now conventional wisdom has done a 180 to argue that HP should dump these things at half cost or so to flood the market?

    A lot has changed in a few short weeks.

    -Suntan
    Yes it was. I don't know what is going on at HP when it comes to anything anymore. They definitely did not run the marathon that they said they would. To do that they would have to accept that they wouldn't have deep market penetration in under 6 weeks against the tablet that leads the market. Xoom sales were not stellar and Motorola stuck it out. So did Samsung and HTC. The Touchpad had pulled to number 2 in mind share just like they wanted. If they would have stuck it out and offered a discount down to the hardware cost they could have moved more. Instead they decided to quit.

    Now they are practically giving them away. The same Best Buy employees that shunned the Touchpad to customer are telling everyone to buy them. The couple that was in line behind me were told to get one by their son who worked at Best Buy in another state. They have the momentum now and momentum is what they needed.

    But think about this, if they offered them at $99 before who would have taken them seriously? In order to do that there has to be less than $99 worth of hardware in them. It wouldn't even be the same product. This sale helps the consumer and webOS more than anything else. However, in order to temporarily salvage the damage that has been done and to make webOS a better candidate for developers and licensing, get more hardware out there.
  14.    #14  
    Quote Originally Posted by VaccPalm View Post
    Just look at Viewsonic when they dumped off the Gtablet. they sold something like 10,000 in a few days at woot.com and they made promises to support it. 2 months later they dropped there support. The Gtablet was the best selling tablet for a while at Amazon when they also dumped them for $270 . There were probally more users using Gtablets then Ipads for a time. Meant nothing. HP will not make anymore and a year from now most of these tablets will be sitting on a shelg collecting dust . Just my opinion.
    That is my only fear, that HP stops support for the software and hardware. I was told they are contractually obligated to support the hardware for one year, which is all I need. They mentioned keeping the OS and licensing it out. If they had thrown all of the remaining Touchpads in a ditch, which is what I thought they were going to do, the OS would have died with them. Instead they sold the remaining stock at a loss and now there are more webOS users than ever before. If the app catalog remains open, they will make money from the apps. The Touchpad can now serve as a lifeboat for webOS until another ship arrives.
  15. Loiter's Avatar
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    #15  
    It's like they killed webOS and they invited many people to the funeral. I don't see anything good coming from this, apart from many people using for the first time a beautiful OS like webOS.
    The homebrew community will thrive for a period, app sales will increase and then people will forget it and check out the new tablets and phones.
  16. #16  
    Where cid you hear that adage about a football team? I'm asking regarding a research project.
    Tia
  17. #17  
    definition of a firesale:

    What is fire sale? definition and meaning

    The fact that these are selling so well at 99 dollars is expected. The point was to get rid of the inventory so they wouldn't be taking up space in stores any more. Its not going to impress anyone at HP or probably at any of the other big electronics companies either. It amazes me that there are still people talking about this like it might be a good thing for WebOS.
  18.    #18  
    Quote Originally Posted by Loiter View Post
    It's like they killed webOS and they invited many people to the funeral. I don't see anything good coming from this, apart from many people using for the first time a beautiful OS like webOS.
    The homebrew community will thrive for a period, app sales will increase and then people will forget it and check out the new tablets and phones.
    They need to get another hardware partner quickly. I give webOS 1 year in it's current state before it completely disappears. That is about the time the manufacturer's warranty will run out on the Touchpads that are in the wild. They should not have announced killing their own hardware department until they had another hardware maker's signature on a contract.
  19. DrewT3's Avatar
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    #19  
    Quote Originally Posted by k4ever View Post
    They need to get another hardware partner quickly. I give webOS 1 year in it's current state before it completely disappears.
    I think you are being wildly optimistic. Any app sales bump from these tablets will be done in a few weeks. Most will end up running android, in the "gadget museum" or sitting on Grandma's desk collecting dust.

    Developers who want a last splash will be done by November. The rest have left already. If there is a licensee of WebOS, and they do a rush job to get a product to market in a year (hugely unlikely), they will find that they have to start from scratch with developers and carry the baggage of two previous WebOS launch failures.

    No, it's dead. Enjoy the cheap hardware.
  20. #20  
    Quote Originally Posted by Kujila View Post
    "We thought consumer interest in WebOS was dead, until we destroyed all our profits by selling these for $99.99 ... now consumer interest in WebOS skyrocketed! Woops, now what?"
    It sounds messed up to say it but this fire sale might just be the thing that saves WebOS from a slow painful death. Having this many people on webos is going to be a big incentive for developers and maybe even HP to stick with it and hopefully breath new life into it.
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