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  1.    #1  
  2. #2  
    From the article:

    "So, it wasn't really a product failure, it was a pricing failure."

    Ding ding ding!
    User of Android, Blackberry OS, WebOS and Windows Mobile (not necessarily in that order).
    sjjones likes this.
  3. ap3604's Avatar
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    #3  
    Cant wait to see Amazons tablet, hope they price it at $199 - $249 and make a big dent in the tablet market
  4. cashmonee's Avatar
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    #4  
    One question to the idea of lower pricing, how do you make money? App stores are not generating enough money to cover significant subsidizing. So if you are going to price under cost or even at cost, where is the profit coming from?

    The Touchpad is selling like crazy because at $99 it is underpriced. Add to that the "deal" aspect and scarcity, and voila, big sales numbers. Hp is writing off nearly $1 billion dollars for this firesale.
  5. #5  
    I'm sure Amazon has been making money hand over fist from microtransactions on the kindle. If anyone could monetize a tablet, they could. So could google, I'm sure, now that they are getting into hardware with the purchase of motorola.

    Welcome to the age of cheap, ad supported tablets.
  6. #6  
    perhaps the profit is not from the sale of the Touchpad, or the sale of apps. It introduces people to HP products, and showing them that HP do in fact make good products. So that in the future, when they are in the market to buy a computer, they will buy a HP.

    I used to work for Toyota. When looking at the Scion brand, there is very little profit to be made, but it introduces younger buyers to a Toyota product, and shows that that Toyota can make a "hip and cool" product. When the same buyers age, they will be more familiar and more interested in considering a Toyota, then hopefully a Lexus later on. This is the only reason that Scion even exists.
  7. #7  
    They could sell content. Kindle books, Amazon Mp3s plus streaming services for video plus downloads. Same strategy as the kindle + productivity of tablet
  8. #8  
    Quote Originally Posted by cashmonee View Post
    One question to the idea of lower pricing, how do you make money? App stores are not generating enough money to cover significant subsidizing. So if you are going to price under cost or even at cost, where is the profit coming from?

    The Touchpad is selling like crazy because at $99 it is underpriced. Add to that the "deal" aspect and scarcity, and voila, big sales numbers. Hp is writing off nearly $1 billion dollars for this firesale.
    There are a few solutions to this problem.

    1. HP could create a lower end webOS tablet that they sell for $100 which acts as the major pushing piece for webOS devices, but also releases a device that is of much higher quality (and Envy-quality tablet) that they sell at a premium. Very similar to how they've built multiple types of PC's, or how car companies make various types of cars using the exact same chassis, but charging different prices for them.

    2. Keep one device at a lower cost which will inevitably bring many more developers to the platform, which means more consumers, which means more developers, which means many more app sales. Even with a limited look on the future of webOS, people are still working on new apps to put in the catalog. Same goes for accessories, which HP would get some payment from.

    3. Bring in more game makers and create the ultimate mobile gaming platform. People will pay a lot of money for games like they do for PCs or gaming consoles. Even Microsoft sells the Xbox at a loss, but then makes up that loss on game sales.

    4. HP could tie in their own stores, enterprise solutions, cloud services, apps, etc... which all cost the consumer money if they choose to use it. They seemed to already be doing this, but my thought would go further than what we had already seen.

    There are more ways, but these are a few to start. Basically, if HP kept up with this trend, eventually they would turn a profit through any number of premium features that people will spend money on to go with their TouchPad. In fact, people will be much more likely to spend money on the extra stuff because they already saved so much money on the machine itself. Many will even think they are saving money while they spend it, because they bought an amazing device at $400 less than their friends who got the iPad.
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    NoICon and Sukiyaki like this.
  9. #9  
    Quote Originally Posted by SwiftTone View Post
    perhaps the profit is not from the sale of the Touchpad, or the sale of apps. It introduces people to HP products, and showing them that HP do in fact make good products. So that in the future, when they are in the market to buy a computer, they will buy a HP.

    I used to work for Toyota. When looking at the Scion brand, there is very little profit to be made, but it introduces younger buyers to a Toyota product, and shows that that Toyota can make a "hip and cool" product. When the same buyers age, they will be more familiar and more interested in considering a Toyota, then hopefully a Lexus later on. This is the only reason that Scion even exists.
    Unfortunately that logic backfired in the auto industry. You have had a lot of 40 year old men buying those boxy cheap cars at a far greater rate than the target demographic.
  10. #10  
    If you want a good laugh, read the comments. People who've never used it are bashing the TouchPad, claiming that it's a single-core tablet, that there are only 50 apps, etc.. The amount of dis-information out there is amazing. But I bet the commenters bashing the TouchPad are still out there trying to get their hands on one just like the rest of us!!!
  11. #11  
    Quote Originally Posted by SwiftTone View Post
    perhaps the profit is not from the sale of the Touchpad, or the sale of apps. It introduces people to HP products, and showing them that HP do in fact make good products. So that in the future, when they are in the market to buy a computer, they will buy a HP.

    I used to work for Toyota. When looking at the Scion brand, there is very little profit to be made, but it introduces younger buyers to a Toyota product, and shows that that Toyota can make a "hip and cool" product. When the same buyers age, they will be more familiar and more interested in considering a Toyota, then hopefully a Lexus later on. This is the only reason that Scion even exists.
    Lexus is Toyota.
  12. mikeyvt1's Avatar
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    #12  
    Quote Originally Posted by Macflyer View Post
    Lexus is Toyota.
    I'm sure he knows that especially working at Toyota. I believe he meant that they would buy a Scion (low end) to a Toyota (Mid grade) then to a Lexus (premium grade)
  13.    #13  
    Quote Originally Posted by untitled View Post
    From the article:

    "So, it wasn't really a product failure, it was a pricing failure."

    Ding ding ding!
    Or the other way to look at it is crack dealers have better business sense then the MBA's at HP.
  14. mikesus's Avatar
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    #14  
    I will probably take a lot of heat for this, but I don't agree.

    First, let me say I own both. The main reason for getting an iPad was to use it to access my work using Cisco Anyconnect and Citrix. Now before you say "But WebOS has that!" Try it. VPN does connect nicely. Then, thats it. Citrix is broke. No RDP. So for corporate users, we are left hanging.

    Secondly, because of life cycle, it just isn't as polished. There are many times I need to tap double tap and triple tap to get the keyboard to come up in the browser. I really haven't seen that in the IOS.

    Thirdly, if it wasn't for the hacks. Touchpad would be a DOG! Out of the box the experience was less than stellar. I enjoy tinkering so with tweaks, it is on par with IOS now. But that is the point, shouldn't have to tweak it to be a contender.

    If these things were addressed before bringing it to market, I don't think we would have seen the firesale...
    TechFan#WN and sinsin07 like this.
  15. #15  
    the issue with the sell it below cost strategy for HP is that they would run the risk of cannibalizing netbook and low end laptops. They are a market leader of both, and actually make a little money on
  16. #16  
    Quote Originally Posted by freeoscar View Post
    the issue with the sell it below cost strategy for HP is that they would run the risk of cannibalizing netbook and low end laptops. They are a market leader of both, and actually make a little money on
    But the iPad is already eating into that market for them. Better to get users into THEIR ecosystem rather than Apple's.

    I think a good long-term strategy would have been to sell at a very slight loss, and plan on doing something to make money off the large number of users (either app or other content sales or advertising). Alas, what could have been.

    But hey, if HP can cancel webOS hardware within 49 days, can't they restart too?
  17. #17  
    Problem with that is that no one is going to buy a TouchPad that isn't under $150 now, $200 max. The TouchPad name has been completely devalued after this firesale. App and accessory sales would likely not make up for the millions they'd lose, so it's just not worth it.
    sinsin07 likes this.
  18. #18  
    Quote Originally Posted by deesugar View Post
    I mentioned the same thing in a thread I started and some of you guys thought I was nuts:

    http://forums.precentral.net/hp-touc...touchpads.html

    Nice to see some tech journalists agreeing with me.
    Jigo likes this.
  19. #19  
    Quote Originally Posted by jrstinkfish View Post
    Problem with that is that no one is going to buy a TouchPad that isn't under $150 now, $200 max. The TouchPad name has been completely devalued after this firesale. App and accessory sales would likely not make up for the millions they'd lose, so it's just not worth it.
    They spend millions on advertisement. Cut that budget and use it to pay to subsidize sells. HP should also use their leverage in the market to drive the cost of the hardware down. Apple does this all the time. Their initial cost are usually 3x higher than what the demand drives the price down to. Sony does this also. It takes them close to a year to drive the cost down on their PlayStation hardware.
  20. #20  
    No tto mention that whoever is buying a touchpad more probably he will also buy a pre 3 or a veer at full price in order to test the functionalities at maximum. And when webOS pc's were about to come out everyone with a touchpad would want to buy one.

    Apple doesn't have this. No everyone with an iphone wants ot buy a Mac because Apple's ecosystem is not based on the synergy between the devices but on the brand. Neither google has this.
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