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What HP's TouchPad Fire Sale Teaches iPad Rivals

samzenpus posted more than 2 years ago | from the flood-the-market dept.

Android 312

Hugh Pickens writes "Christopher Williams writes that the success of HP's fire sale in unloading hundreds of thousands of TouchPads at heavily discounted prices may provide clues to other Apple competitors hoping to loosen the iPad's stranglehold on the tablet computing market. The main Google Android tablets, made by Samsung and Motorola, are pitched at around the same price point as the iPad but, put together with all the other Android tablets, it's estimated the iPad outsells them eight to one so 'the problem becomes circular: the user base is too small for app developers to invest in,' writes Williams, 'so users buy an iPad because there are more apps and the user base gets even smaller relative to Apple's.' According to Williams, Android tablet makers must find a way of breaking the cycle to avoid the TouchPad's fate. 'No doubt acutely aware of this is Amazon, which is rumored to be preparing to release an Android tablet this autumn,' writes Williams, adding that Amazon must price their 'iPad killer' at break-even or a loss to succeed. 'Its online retail empire and the Kindle brand mean Amazon has the marketing clout to take on the iPad, but on the evidence of HP's successful TouchPad sell off, the question is whether it has the courage to put its money on the line. '"

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312 comments

$100 is an impulse buy, $500 is not (4, Insightful)

elrous0 (869638) | more than 2 years ago | (#37196814)

Do they really need an in-depth analysis for something that bloody simple?

Yeah sure, you can beat the iPad if you offer similar features and sell it for $100--no shit. How is that in ANY way analogous too offering your pad for $50-$100 cheaper than an iPad? Oooh, let's all run out an buy the Amazon maxiPad because it's $650 instead of the iPad's $700!! Unless you're prepared to absolutely bleed money on every maxiPad sale, you're not going to soak up even a single percentage point of the iPad's market dominance.

Re:$100 is an impulse buy, $500 is not (0)

Anonymous Coward | more than 2 years ago | (#37196874)

Do they really need an in-depth analysis for something that bloody simple?

Yeah sure, you can beat the iPad if you offer similar features and sell it for $100--no shit. How is that in ANY way analogous too offering your pad for $50-$100 cheaper than an iPad? Oooh, let's all run out an buy the Amazon maxiPad because it's $650 instead of the iPad's $700!! Unless you're prepared to absolutely bleed money on every maxiPad sale, you're not going to soak up even a single percentage point of the iPad's market dominance.

well said!

drop some gizmos like in netbooks (0)

peter303 (12292) | more than 2 years ago | (#37197004)

Touchscreen, size, color, wireless are important.

Audio, video, GPS, 3G, phone, camera, could be optional. Mobile devices have been evolving into "swiss army knives". But this may not be necessary.

Huh? (1)

dwightk (415372) | more than 2 years ago | (#37197068)

what would you do with a large colorful touchscreen that didn't do "video"?

Re:Huh? (1)

RingDev (879105) | more than 2 years ago | (#37197728)

I would hope he means that super high quality video isn't a requirement. Being able to watch 1080i is a nice to have, but watching 320p on those resolutions is really good enough.

-Rick

Re:Huh? (2)

jedidiah (1196) | more than 2 years ago | (#37197782)

A device that can't play your original files is a bother. Whatever is a bother for a geek, may be pretty impossible for a mundane consumer.

Anything that's a video player should "just work" for a wide range of media files.

Does anyone actually use tablets? (-1)

Anonymous Coward | more than 2 years ago | (#37197056)

I keep hearing how popular tablets are, but I never actually see anyone using them.

I work in industry at an office in the downtown core of a large American city, but I also get to travel as part of my job, and I lecture part-time at a local college. During a typical week, I'll see thousands upon thousands upon thousands of people, in all sorts of settings doing all sorts of activities. But I very rarely see anyone using an iPad, or any other tablet.

Sometimes I commute by public transit, and I never see people there using them there. I never see people using them when I'm flying to other cities, even across the country. I never see people sitting outdoors using them. I never see people using them while eating lunch or drinking coffee. I never see people using them at my workplace. I never see people using them at the offices of the other companies I visit.

I've only seen my students use them on two occasions before class, but both students put them away and used netbooks instead when the lecture started. The only other time I've seen people use them is at Apple stores.

Tablet users are something that I actively keep an eye out for, but they just don't seem to exist. For all the hype that tablets get, I'd expect to see them actually being used. I mean, I see people using their cell phones. I see people using netbooks. I've even seen more people writing in paper notebooks with pens in the past week than I've seen tablet users in total, over all time.

So I have to ask, does anyone actually use tablets?

Re:Does anyone actually use tablets? (1)

Jeng (926980) | more than 2 years ago | (#37197152)

I saw around three of them being used as E-readers on my last flight.

The actual E-readers outnumbered the tablets though.

Re:Does anyone actually use tablets? (2)

RandomFactor (22447) | more than 2 years ago | (#37197450)

Every single day. On the long trainride to/from work, in the can, as a quick and dirty hotspot when needed, as a backup for my home internet when the cable goes down, as a halfway decent game platform, watching netflix (until 3.1 broke it...mutter...) to IM back and forth with the wife and kids, handy camera, general internet browsing, reading mail, and reading books and magazines with Kindle and Nook software etc.etc.

  It is a form factor that (unlike a laptop) is actually viable to haul around with you just whenever.

Re:Does anyone actually use tablets? (1)

dissy (172727) | more than 2 years ago | (#37197462)

So I have to ask, does anyone actually use tablets?

Nope, no one. Not a single person.
All the sales numbers are fake, and the devices don't actually exist outside of demo units.

Re:$100 is an impulse buy, $500 is not (3, Insightful)

poetmatt (793785) | more than 2 years ago | (#37197160)

Absolutely. There is no tablet in the world worth over $200. That even includes the asus transformer 32GB with the dock. These devices are just not worth it - limited functionality for a premium? Of course it's not selling.

Apple sells millions of tablets for $500+ (1)

Brannon (221550) | more than 2 years ago | (#37197412)

It clearly is worth it for millions of people; so that's not the reason that the HP tablet failed.

Re:Apple sells millions of tablets for $500+ (1)

dr. chuck bunsen (762090) | more than 2 years ago | (#37197524)

For at least half of those people it isn'tt the actual device that is worth it, it's the whole "apple club" thing that is. I'm not saying there is anything wrong with that, just that they are 2 different things.

Re:Apple sells millions of tablets for $500+ (0)

Anonymous Coward | more than 2 years ago | (#37197932)

For at least half of those people it isn'tt the actual device that is worth it, it's the whole "apple club" thing that is.

If you're over 50 you should probably check your prostate while you're in there gathering market research insights.

Re:Apple sells millions of iPads for $500+ (1)

firewood (41230) | more than 2 years ago | (#37197722)

Fixed that for you.

The customers for iPad don't know about or care about tablets (even if some vendors are deluded into thinking they are the same thing because the specs are comparable).

Re:$100 is an impulse buy, $500 is not (0)

Anonymous Coward | more than 2 years ago | (#37197456)

That would be, except all of them. The Apple iPad costs $250 in parts, plus assembly and shipping.

Given their bulk discounts, I'd imagine the HP product costs even more to make.

Re:$100 is an impulse buy, $500 is not (1)

QuantumRiff (120817) | more than 2 years ago | (#37197224)

Isn't that what they do with video game systems? Sell the unit at either cost, or a loss, and make up for it by a percentage of the games sold.. (or apps bought)

Re:$100 is an impulse buy, $500 is not (0)

Anonymous Coward | more than 2 years ago | (#37197816)

Yes but apps don't sell for a $100 a piece profit margin. There would need to be substantial app purchases per device to make up the loss for the manufacturer - and on their own store - not google marketplace. Android apps are more or less free*, iOS apps are not.

That's a big problem for the android tablet market.

* Yes there are exceptions, but you really can skimp by not purchasing any apps and not losing any functionality or quality of app (for the most part).

Re:$100 is an impulse buy, $500 is not (1)

ThorGod (456163) | more than 2 years ago | (#37197226)

I agree. I loved playing with the iPad in the Apple Store...but I just can't pony up $500+ for it. Not when I could get a decent to good laptop for that price.

Maybe the ipad makes more sense if you don't have a laptop or have some reason to not carry one around...

Re:$100 is an impulse buy, $500 is not (4, Insightful)

Chrutil (732561) | more than 2 years ago | (#37197318)

Maybe the ipad makes more sense if you don't have a laptop or have some reason to not carry one around...

Actually my iPad *is* my reason for not carrying my laptop around.

Re:$100 is an impulse buy, $500 is not (3, Insightful)

fractalus (322043) | more than 2 years ago | (#37197814)

I've has my Galaxy Tab 10.1 for a couple of months. Before that I had a Nook Color that I rooted. I started with the NC because I wasn't sure if I would have a use for a tablet, and the NC was half the price of the Tab.

There's no doubt these are primarily consumption devices; although they can be used for creation, that's not their strength and the more creative work you do on them the less fun it gets. What surprised me was just how much of my ordinary computer use was consumptive, and that now it's easier to squeeze in a bit of consumption here and there without resorting to a full computer. Instant on, super-long battery life, and an OS that's simplified make a huge difference.

As much as I was surprised how much I now do on my Tab (so much so that my regular computer gets dusty), imagine what it's like for people that really do want a computer "appliance". Apple created an entire market of consumers out of people who previously weren't consumers: people who didn't want the hassle of [another] computer. This is part of the magic of the iPad, and why nearly 30 million have been sold. The TouchPad's demise doesn't tell us much about the tablet market overall except that the TouchPad wasn't what people wanted compared to an iPad. Android has similar market-share (and mind-share) problems, only differing in degree.

Google should be throwing money at devs to write Android tablet apps if they want to catch up to Apple, our even just stay in the game. Otherwise they risk being marginalized, and if that happens on the tablet side it may leak over to the phone side.

The in-depth analysis (1)

KingSkippus (799657) | more than 2 years ago | (#37197394)

No, they don't need an in-depth analysis for that, duh.

What they do need an in-depth analysis for is mainly answering two questions:

1) Is there a way to make enough money off of other stuff to use the hardware as a loss-leader, and if so, how much of a loss-leader can they afford? In Amazon's case, perhaps they can afford to sell the hardware at a substantial discount--yes, perhaps even $99--if, for example, they have an iTunes-like store in which they can make gobs of money to cover the cost of manufacturing the tablets plus make a profit.

2) Are there other advantages in leveraging a very large user base? In Amazon's case, for example, if they have bajillions of Amazon Kindroids out there, maybe content companies (20th Century Fox, Warner Brothers, Sony, etc.) would cut really good deals to Amazon on their streaming service license fees.

That second point cannot be overstated enough. Apple frequently uses their market position to dictate to developers and content creators the terms under which their creations will be sold in the App Store, whereas when developers and content creators deal with Amazon, they have a lot more leverage because their market position is quite a bit weaker. If Amazon sold a bunch of Kindroids for a loss of $1 million but were able to negotiate $2 million in savings and/or profits from people who want access to the massive Kindroid user base that creates, that's a win.

Of course, it's also a dangerous game to play. If they sell a crapton of Kindroids but those users don't buy crap in addition to it, they might not be able to leverage their position and they're just out $1 million... Thus the in-depth analysis.

Re:The in-depth analysis (1)

BSDimwit (583028) | more than 2 years ago | (#37197560)

I think you are mostly right. Amazon is really the only company currently capable of taking on Apple. If they were to do as you suggest and pretty much sell the Kindroids at cost, they could probably make a bit of coin on the content, but I think they would have to resort to a walled garden similar to Apple's for it to work. Yeah, you could probably the geek community side load apps and music (they would find a way around it anyway) but I wouldn't make it easy for the less savvy users. They will simply open up their app store app or music app and buy from amazon just like the Apple users do en mass. One thing they definitely would have to do though is make the process as seamless as possible because that is why the app store and iTMS took off.

Re:$100 is an impulse buy, $500 is not (1)

pjfontillas (1743424) | more than 2 years ago | (#37197404)

You brought up an interested point. Do you think any company is willing to bleed money just to get more market share? How much is spent in marketing the product and can any of that be relocated to supporting selling at a loss? Would the benefits of (potential) increased market share outweigh the cost of lower priced products?

So, sell a $300 item for $100 (1)

Anonymous Coward | more than 2 years ago | (#37196864)

And we learn that people really, really, really like a bargain. We don't learn much else.

Worse tablets (2)

digitallife (805599) | more than 2 years ago | (#37196908)

It's obvious that if you offer a tablet with similar features to an iPad but substantially cheaper, even if it lacks in some areas (such as apps or polish), people will buy it. It doesn't take a genius to realize that. Thats pretty much what's happening with the iPhone and Android phones already. The question that interests me more is whether a worse tablet (worse specs) at a substantially reduced price point will sell well.

Re:Worse tablets (0)

Anonymous Coward | more than 2 years ago | (#37196990)

depends how much worse the tablet is,
i think the main thing is it has to "feel" (not be) responsive.
as long as it can handle that i think it will sell

Re:Worse tablets (2)

mercuryguy (922217) | more than 2 years ago | (#37197028)

This is similar to the PC and Netbook comparison. People did buy netbook in droves, didn't they?

Re:Worse tablets (1)

Anonymous Coward | more than 2 years ago | (#37197354)

I've never seen a netbook with anything but 1GB of RAM for sale in Canada. Put crappy specifications in a computer that's supposed to run the latest Windows and you're sure to never sell your product.

Re:Worse tablets (1, Funny)

jedidiah (1196) | more than 2 years ago | (#37197032)

> Thats pretty much what's happening with the iPhone and Android phones already.

Not quite.

What's happening with the iPhone and Android phones is that Apple is getting it's clocked cleaned. Android phones and iPhones are both equally subsidized but both are cheap enough that they represent impulse purchases. At the "impulse buy" point, Apple loses it's hype advantage. More people are willing to take risks. Apple exploited this themselves with the iPad. They dropped the tablet price from $2000 to $600.

Apple is the el-cheapo option. It's funny that some people don't realize this.

Apple getting it's clock cleaned on phones? (5, Insightful)

Brannon (221550) | more than 2 years ago | (#37197148)

They have 50% of all the profit in the smartphone industry. They are printing money. How does that equate with getting their clock cleaned?

Re:Worse tablets (5, Interesting)

JordanL (886154) | more than 2 years ago | (#37197200)

I've had both Android and iPhone devices. The biggest difference I see in the user-experience is that the Android solutions feel more like I'm getting whatever the hell Company X decided I should have. The iPhone does not. The Android devices seem more cobbled together.

I haven't been able to figure out why it seems this way. I know this to be the opposite in many ways of what actually happens. I can't easily modify an iPhone if I find it lacking, but doing so on many Android devices is easier. I also have the chance to start with a device that more exactly fits what I want. Yet it seems while using them that the iPhone is asking me the question "what do you want me to do" and the Android is telling me "this is how you do that".

Like I said, I have no idea why they come off this way to me. Perhaps it's related to UI design, or maybe it's related to responsiveness.

Re:Worse tablets (2)

Nerdfest (867930) | more than 2 years ago | (#37197684)

It's probably that the iPhone interface happens to perfectly match your expectations. If they didn't, the limited comparability would push you the other way.

Re:Worse tablets (1)

Wyatt Earp (1029) | more than 2 years ago | (#37197278)

Since when has record profits and record sales meant "getting it's clock cleaned"?

Re:Worse tablets (1)

jedidiah (1196) | more than 2 years ago | (#37197824)

You're funny.

You know, all of the "haters" said that EXACTLY this would happen. The open platform would come along and a bunch of Lilliputians working more or less together would end Apple's dominance.

Now you're trying to distort reality to hold onto this delusion that Apple is set to make up for old failures.

Self serving abuses of statistics won't alter the reality of the situation.

Re:Worse tablets (3, Informative)

digitallife (805599) | more than 2 years ago | (#37197410)

Certainly there are android phones at the same price point as the iphone, except that the most popular android phones are the cheap ones which usually either have zero upfront cost or no contract. So in reality the situation is more similar to what I suggested: Android is the cheap alternative to the iPhone.

Re:Worse tablets (0)

jedidiah (1196) | more than 2 years ago | (#37197858)

> Certainly there are android phones....

Keep telling yourself that. Meanwhile the power users that flee iPhone because of their bad SMS features will take advantage of larger market that diverse hardware allows. I don't really care if 99.99% of the proles are "buying the cheap crap because it's cheap". I am still able to be a more discriminating consumer. I can get something better.

Android is everything that Apple refuses to allow.

You're confusing your phone with your junk.

Re:Worse tablets (1)

whisper_jeff (680366) | more than 2 years ago | (#37197430)

How is having the TWO best selling smart phones (iPhone 4 #1, iPhone 3GS #2) getting their clock cleaned? No. Really - explain to me how you can possibly make a statement like "Apple is getting it's clocked cleaned" when Apple has the #1 and #2 smartphone because, last time I checked, when you have the best selling _AND_ the second best selling product in a market, that's pretty damn successful. Perhaps you have a different definition of "success" however...

Re:Worse tablets (0)

darkuni (986212) | more than 2 years ago | (#37197614)

Ummm .. Android owning 56% of the smartphone market appears to be at least "approaching" the "getting their clock cleaned" - and a large percentage of that happened remarkably recently.

Re:Worse tablets (2)

whisper_jeff (680366) | more than 2 years ago | (#37197678)

Please identify a manufacturer who remotely comes close to Apple's success and sales figures. Not an OS released by many manufacturers - please name a _manufacturer_ so we can compare apples to apples (so to speak).

Or, if you're going to try the Android vs iOS angle, at least view the entire iOS ecosystem which includes iPhones, iPads, _AND_ the iPod Touch (last number I saw, which was from March of 2011, was just shy of 200,000,000 - 170-ish, iirc). So, again, explain to me how Apple is getting its clock cleaned.

The facts simply do not support any such claim.

Re:Worse tablets (1)

jedidiah (1196) | more than 2 years ago | (#37197798)

> Please identify a manufacturer who remotely comes close to Apple's success and sales figures.

It's a stupid argument. You might as well say that MacOS has the largest marketshare for the same dumb reason.

Nice, but not necessary (1)

Anonymous Coward | more than 2 years ago | (#37196918)

Tablet apps are a nice thing to have on Android, especially when they're well done, but they're not all that necessary. Android was designed from the beginning to be able to handle different screen sizes and densities, and, admittedly not without a little pain, it handles it very well. A majority of apps just work on Android tablets. Some apps look sparse on larger screens, and some don't work because they used fixed positioning, but really, most apps don't need to be rewritten for tablets. They are compelling as is. The app gap is a myth.

Re:Nice, but not necessary (1)

Anonymous Coward | more than 2 years ago | (#37197452)

I think you underestimate the advantage a UI which is designed for a tablet has over a one that is designed for a phone when run on a larger screen. Why even buy a tablet if all you are going to get is the same UI regardless of screen size? You claim this app gap is a myth, I say it's not. Folks who go to the trouble of buying a tablet are going to want software that was designed for it.

Sure, standard phone apps run on android tablets, but then again so do iPhone apps and as an iPad user, I much prefer apps that were designed for the iPad as it makes the user experience a better one. Android devs can certainly remedy the situation, but until they do, the iPad will continue to dominate the tablet market...and it still might even if they do given that the tablet market is a different animal than the subsidized phone market.

That cheap shit sells? (0)

Anonymous Coward | more than 2 years ago | (#37196924)

Duh.

Re:That cheap shit sells? (1)

Spy Handler (822350) | more than 2 years ago | (#37197034)

reminds me of my youth, when throwing your opponent in Street Fighter 2 would elicit cries of "CHEAP SHIT!"

maybe this will help the HP PSG Unit (0)

Anonymous Coward | more than 2 years ago | (#37196932)

...possible selling the HP tablet so low will help to sell the HP PSG unit and make WebOS more attractive to the potential buyer.

Possible now WebOS has more "potential" value, than when HP was holding it. So, if HP is selling the PSG unit with WebOS, this may help to get more value to that platform..... at the cost of HP loosing money with the touchpad ;)

Leverage (3, Insightful)

Stickerboy (61554) | more than 2 years ago | (#37196976)

What Apple's rivals should do is not just learn a lesson. They should leverage the TouchPad. Get Android working on the TouchPad which just sold hundreds of thousands of units, and keep building the Android app userbase.

Apple has had the advantage of leveraging what was originally the iPod consumer base into a mature ecosystem which has turned out to be one of the iPad's main advantages over its would-be rivals. Here's a golden opportunity for Apple's rivals to influence the future purchasing decisions of hundreds of thousands of consumers.

Re:Leverage (1)

gad_zuki! (70830) | more than 2 years ago | (#37197236)

> Get Android working on the TouchPad

You mean 2.3 which is open sourced and available? The 2.x branch is incredibly shitty for tablets and wont give you access to the market or any of the google apps.

If anyone does this, they have to use Honeycomb, its light years ahead of 2.x in regards to tablets. People want a proper tablet not a giant phone.

Im so sick of half-assed 2.x tablets hurting Android's reputation. Thankfully, only tinkerers will enjoy the suckitude of 2.x tablets.

Re:Leverage (0)

Anonymous Coward | more than 2 years ago | (#37197606)

"You mean 2.3 which is open sourced and available? The 2.x branch is incredibly shitty for tablets and wont give you access to the market or any of the google apps."

Strange, it works just fine on the last tablet I played with. Sure there are no Google blessed 2.x tablets, but for the tinkerers getting the market to work is the first, simple step. It works well enough for me to not bother to try the 3.x hack

Re:Leverage (1)

Asic Eng (193332) | more than 2 years ago | (#37197482)

That's a brilliant idea. It would also limit cannibalizing the sales of their high-end devices since HP is not making any new devices. Someone should suggest it to Samsung - they just might be a little bit annoyed with Apple right now.

Cut the cost (1)

frisket (149522) | more than 2 years ago | (#37196978)

$600 or $400 is way too much for a tablet. Half that, or less, is plenty to pay. Pile 'em high and sell 'em cheap.

Hell, why not free? (2)

Brannon (221550) | more than 2 years ago | (#37197188)

Since you are ignoring all the component and manufacturating costs that it actually takes to make these things--what the hell? why not go all the way.

Re:Hell, why not free? (1)

MacTO (1161105) | more than 2 years ago | (#37197910)

What does the component and manufacturing of a tablet cost, in relation to a laptop? I would expect tablets to be similar, if not less expensive, to produce. (Ignoring R&D costs of course, but you can make that up with high volume and low margins.)

The fact is that big conservative businesses rarely branch out into risky new technologies unless the margins are high and the margins for their existing products are nearing the end of a race to the bottom. Desktops hit the bottom, so they rushed to laptops. Laptops hit the bottom, so they are rushing to tablets.

Here's an idea (1)

Pop69 (700500) | more than 2 years ago | (#37196986)

Stop fixating your reviews or articles on Android tablets that are the same price as iPads and let us know what is out there for cheaper ?

I picked up an ASUS Transformer for £100 less than the Motorola Xoom and it has exactly the same spec and OS

Re:Here's an idea (1)

jedidiah (1196) | more than 2 years ago | (#37197092)

While contemplating a "pack light" trip to Europe I am starting to reconsider the idea of a 7" tablet. It seems to be big enough to be a significant improvement over a phone while not being quite as huge as an iPad or similarly sized devices.

Re:Here's an idea (1)

joh (27088) | more than 2 years ago | (#37197808)

On the other hand it does exactly the same as any decent smartphone, but is much harder to put into most pockets. And you'll very probably need a phone anyway.

I usually take my iPhone, the Apple BT keyboard and a glif [theglif.com]. The keyboard makes a world of a difference when writing more than just short texts, it's very light and small and you don't need to carry it all the time.

Re:Here's an idea (1)

thetoadwarrior (1268702) | more than 2 years ago | (#37197146)

It's probably because the cheaper ones aren't worth talking about. You can't make something on par to an iPad and have it costing 1/3rd of the price.

Re:Here's an idea (1)

lgftsa (617184) | more than 2 years ago | (#37197856)

Not the same spec.
When it was first announced, I was delighted. The detachable keyboard made it the perfect combination of tablet and netbook for me.
When it went on sale, there was no mention of it's mobile capabilities. Dual band, quad band, locked? No problem I thought, I'll go down to the local JB store and have a fondle, the spec will be on the box.
No, it wasn't. This wonderful device, thoughtfully designed to fit ALL my needs is WiFi only.
So, after I confirmed there was no 3G model coming, I bought a Xoom, and I've been perfectly happy with it.

The moral of the story is... (2)

gestalt_n_pepper (991155) | more than 2 years ago | (#37197018)

$100 is the right price point for an adequate tablet with Wifi or 3g. At $700, any pad is a bad joke, especially when a netbook is $300 and $150 readers can be rooted and made to function as tablets. $100 seems too low? Remember what laptops used to cost? Manufacturers will just have to get over it. The high margin time window just gets shorter and shorter.

Re:The moral of the story is... (1)

nine-times (778537) | more than 2 years ago | (#37197334)

Remember what laptops used to cost? Manufacturers will just have to get over it. The high margin time window just gets shorter and shorter.

laptops didn't get cheaper just because manufacturers dropped their margins. The technology got better, faster, and cheaper. In this case, HP decided to take a product that wasn't selling and sell it at a big loss. It's neat that people have snapped them up, but there's no business model here-- not unless these tablets can be sold as loss-leaders for some other expensive product.

Re:The moral of the story is... (1)

shmlco (594907) | more than 2 years ago | (#37197428)

The TouchPard cost $328 in parts and labor, and that's ONLY parts and labor. There's also the small matter of trying to recoup the $1.2 BILLION HP spent acquiring Palm and WebOS.

I'd like an "adequate" hybrid car for $2,500 too, but I don't think I'm going to get one...

Re:The moral of the story is... (1)

Slashdot Assistant (2336034) | more than 2 years ago | (#37197776)

$150 readers can be rooted and made to function as tablets

Yeah, in the same way that a hairdryer can be used to make toast. Depends on what you actually plan to use it for and the type of experience you're after. The average non-technie user who wants to be able to lie in bed and watch a movie isn't likely likely to be spending time rooting a fucking e-reader and then trying to squeeze everything they can out of a device that effectively belongs to a different class of products. Yeah, some e-readers are looking pretty capable. These are the ones that are sitting on the hazy line between tablets and e-readers. $100 for an adequate tablet? Sure, if you're also the kind of person who'd consider a gimped $300 laptop in a casing designed in an afternoon to be perfectly adequate. Prices will come down as tablets become more ubiquitous. Part of that is of course due to them being a novel or premium item, and part is due to it being a comparatively small market with new manufacturing processes and expertise required. Maybe $100 in the future, but not likely anytime soon unless it's tied-in somehow to a revenue stream that effectively shifts the cost elsewhere from the initial purchase price - such as the cell phone contracts.

The problem of price vs. value remains. (1)

scottbomb (1290580) | more than 2 years ago | (#37197026)

A tablet is a luxury item. I can't justify spending $600 or $800 (or whatever they cost) on a tablet when I can buy a laptop or build my own desktop for something in the $300-400 range.

Re:The problem of price vs. value remains. (1)

PRMan (959735) | more than 2 years ago | (#37197292)

That's why Asus prices a very high-quality tablet for around $350-$399 now.

Re:The problem of price vs. value remains. (1)

Duradin (1261418) | more than 2 years ago | (#37197314)

Go to the local salvation army or good will, you can get a desktop for $25.

At some point, almost anything is a luxury item. (Your $300 machine vs. the used $25 machine, why pay more for the luxury of something new?)

Wrong question (2)

Brannon (221550) | more than 2 years ago | (#37197374)

The question isn't whether $500+ for a tablet is feasible in the market--it has been 100% proven that this is a feasible price point because Apple is selling tens of millions of iPads. The question is why can't anyone else replicate what Apple is doing with tablets?

I think part of the problem is that Apple has an even larger headstart on tablets than they had on smartphones. It also seems that the 'ecosystem' is an even more important differentiater for tablets than for smartphones. I expect Android tablets to slowly catch up in terms of hardware/software quality (just like they are slowly catching up in smartphones) and ecosystem (although this ramp is even slower).

The real question is what the next plateau will be; will it be like smartphones where Apple is happy to have 50% of the industry-wide profit (and let everyone else fight over the scraps)?

Re:Wrong question (0)

internetcommie (945194) | more than 2 years ago | (#37197740)

I think the problem (and it is a problem) is that Apple seem to blind everybody with every new, shiny gadget they introduce. And everybody who are blinded by Apple's shiny gadgets either want one really, really badly (call them fanbois if you like; they are just consumers like all of us) or they really, really badly wishes they came up with this shiny gadget first. So they simply try to make their own version of the same shiny gadget, with some unimportant twist like Flash or an open operating system, but no real innovation. To compete with Apple, companies would need to either sell their similar products considerably cheaper than the shiny Apple gadgets, or they would have to offer something different and useful, or at least desirable. In short, they need to innovate, not just copy what Apple did and put a different label on it. So far I've seen very little innovation, and that means Apple wins.

Selling at a loss doesn't help ... (2)

MacTO (1161105) | more than 2 years ago | (#37197030)

Selling a product at a loss doesn't help unless you have some other revenue stream.

Console makers get away with it because they license developers. Besides, the production cycle on a console is long enough to actually put them into the black over the long run.

Cellular companies get away with it because customers are locked into a contract, and have to pay a large sum to get out of it.

Tablet makers though? I guess Apple has their app store and other developers can do the same, but most they would have to sell a lot of apps to make up the difference (since most apps are significantly cheaper than most console games, if you're using that model). The service model may work, but I honestly don't know how many people are going to be willing to pay for yet another internet connection. After all, the people who buy tablets are likely already paying for home internet and cellular internet service.

Re:Selling at a loss doesn't help ... (1)

Anonymous Coward | more than 2 years ago | (#37197256)

We sell at a lose but make it up in volume.

Re:Selling at a loss doesn't help ... (1)

makubesu (1910402) | more than 2 years ago | (#37197842)

Close. More like sell at a loss, but at high enough of a volume that you're deemed too big to fail.

What android needs is an army of fanbois (-1, Troll)

Ice Station Zebra (18124) | more than 2 years ago | (#37197036)

Who are as dedicated to android as the apple fanbois are to the shit that apple sells.

Yes, I'm an android fanboi and I don't even own one (yet). I do know that I will NEVER buy an apple product.

Re:What android needs is an army of fanbois (1)

whisper_jeff (680366) | more than 2 years ago | (#37197478)

What android needs is an army of fanbois who are as dedicated to android...

You mean Slashdot? ;)

Re:What android needs is an army of fanbois (2)

minimunchkin (838824) | more than 2 years ago | (#37197532)

Who are as dedicated to android as the apple fanbois are to the shit that apple sells.

Yes, I'm an android fanboi and I don't even own one (yet). I do know that I will NEVER buy an apple product.

So not so much a fan then, more a zealot.

Re:What android needs is an army of fanbois (0)

Anonymous Coward | more than 2 years ago | (#37197864)

I'm not an Apple fanboi. My iPhone was my first Apple product. I bought an iPad a few years later because when I saw it I thought "Jeebus, that is exactly what a computer should be like!" Then I went to BestBuy, played with it for an hour or so, and found it was better than the advertising made it look. Its built better than ANY laptop I've had in the last few years, its software "just works", and its battery life fits my usage style. Thats why I bought it.

A previous poster noted that many people use it as an excuse to leave thier laptop home. I know I do. Its easy to transport, and with 10+ hours of battery life, I don't have to drag cables. Apple winds because the competition is trying to compete with Apple, not wow me with a better choice. I'm a tech guy, but I don't care about going under the hood. I just want available options (apps), and effortless usage. Apple delivers that, even jailbroken (jailbreaking is ridiculously easy), It still delivers. Android devices? not so much.

Apples are slick european sporty cars. The contenders are thier American competitors.

YMMV
heybiff

Re:What android needs is an army of fanbois (1)

joh (27088) | more than 2 years ago | (#37197878)

Who are as dedicated to android as the apple fanbois are to the shit that apple sells.

Yes, I'm an android fanboi and I don't even own one (yet). I do know that I will NEVER buy an apple product.

Most of the 200 million iOS users weren't Apple customers (or fanbois) before they bought an iPhone/iPad. What Android needs isn't more fanatic Android users, it's more Android users in the first place.

Huh? (1)

Desler (1608317) | more than 2 years ago | (#37197098)

at break-even or a loss to succeed

So to "succeed" they need to either make no money or lose money while Apple, even with lower market share, will still command strong sales and great profit margins. That sounds familiar. Oh right, it's just like how Apple has maybe 1/3 or 1/4 of the world smart phone market share yet pulls in 2/3 of the profit. Will these people never learn that a race to the bottom and razor thin margins is not the way to run business? Meanwhile, Apple will have strong profits and will be laughing all the way to the bank.

Videogame Hardware (0)

Anonymous Coward | more than 2 years ago | (#37197128)

With the exception of Nintendo, most videogame hardware is sold at a lost initially as a way of building the customer base. The idea being that the hardware maker will recoup their investment through game licenses and because their hardware costs will go down over time. While this seems like a plausible model for tablet makers, there are two problems, the first is that Apple has set the expected product lifespan of a tablet at one year, meaning components prices will never get cheaper. Second, the going rate for a tablet app is like one dollar, so there isn't any room to quickly make back money through licensing arrangements. Basically, if a tablet maker wants to get in to the market, they better plan on getting in for the long haul.

Hugh Pickens...Again? (0)

Anonymous Coward | more than 2 years ago | (#37197164)

I don't mind the articles, but does he work for Slashdot now or just spam the submissions folder cause I've seen numerous stories where he's duplicated what others had already submitted. How is it that his particular submissions continue to be picked for show when there are the same articles submitted by others and before him? Hugh Pickens, who are you that you get such preferred treatment?

Customers demand more for less! (1)

caywen (942955) | more than 2 years ago | (#37197166)

News at 11!

Seriously though, all it really shows is that $99 is past the impulse buy threshold for a quality tablet. Duh.

The problem is WebOS, there's no room for another (2)

gad_zuki! (70830) | more than 2 years ago | (#37197168)

The same pattern keeps appearing. iPhone vs Android a few years ago and then an oddball player called the Pre came along which never drew in a lot of developers and never had the level of apps Android and iPhone enjoy. Pre failed. WebOS was later put on what was priced as essentially a feature phone, the Pixi.

Now, we're playing this game again. iPad vs Honeycomb Tablets and then WebOS appears again. Not a lot of interest, still no developers, still no apps, and HP just decided to call it quits when their forecasts said this thing was going to be another Pre.

In operating systems there tends to be a natural monopoly and natural duopolies because of the scales involved and because people really don't crave that much choice. This is yet another example of this reality.

Most likely, someone will released some half-assed 2.3 ROM for this tablet and it'll suck. Shame google isn't releasing 3.2 for this thing via a side-channel. Honeycomb really is on par with ipad and makes for incredible experience.

Re:The problem is WebOS, there's no room for anoth (1)

Microlith (54737) | more than 2 years ago | (#37197308)

In operating systems there tends to be a natural monopoly and natural duopolies because of the scales involved and because people really don't crave that much choice. This is yet another example of this reality.

There is no "natural monopoly" or "natural duopoly" in the OS space. There is monopolistic and anti-competitive actions that make it very hard for 3rd party options to survive. Which is the goal of Apple and MS, since they have the desktop space to themselves and they want the exact same situation in the mobile space. This is not an example of a "natural duopoly" coming to fruition, but rather that HP could not compete on the business end of things.

Too expensive (1)

tycoex (1832784) | more than 2 years ago | (#37197192)

I personally feel that tablets are just too expensive right now.

They are, basically, smartphones - the phone + a bigger screen. Now I'm not totally dissing this design. There have been times when reading something or wanting to show something to others that I would have loved for my phone to have a bigger screen. However, I already have my phone.

Buying a tablet is an additional cost on top of the phone. It's not like just because I'm willing to pay 200 + contract for a phone I'd be willing to pay the same amount for a tablet, because I actually "need" the phone. I'm not going to decide whether to buy a tablet or a phone, because the phone is much more necessary. Since their functions overlap, the tablet is a completely extra luxury device.

I won't be buying a tablet until they are significantly cheaper (I would have bought a touchpad but I'm broke this month... too bad they didn't liquidate them next month). From what I understand tablets are actually fairly expensive to manufacture, so I'm not expecting the manufacturers to drastically lower the price until they get cheaper to make. So... I don't expect Android tablets to become all that popular until the cost to make them goes down. Let the early adopters pay high amounts so that the price of the tech ends up going down for all of us (just like any other tech).

The reason this doesn't effect Apple is... well do I really have to say it? Apple users are used to overpaying for stuff.

Self Serving Suggestion: (1)

notKevinJohn (2218940) | more than 2 years ago | (#37197250)

If Andoid manufacturers are worried about not enough Apps existing on their platform, I think the solution is obvious: Give App developers (like me!) free Tablets. I PROMISE to make lots of really nice apps for it.

iPad developers vs. Android (0)

sacridias (2322944) | more than 2 years ago | (#37197392)

Seriously this is about the stupidest argument ever heard. Android already can compete with iPad, what are they trying to say. iPad does not have a huge incomprehensible market, they have devout worshipers that purchase as soon as their products come out. Android people are a bit pickier when it comes to buying something, they actually take time to evaluate the products instead of the hipsters who buy a label. There are plenty of apps, games, and utilities for Android tablets, and plenty of well selling tablets out there making a decent profit.
Apple is not the future of mobile technology, in fact Android sells are surpassing them more and more each day. Apple is resorting to lawsuits to slow the competition because they are afraid of loosing. The only competition Amazon has to worry about is other Android makers, because the die hard iPad people are Steve Job worshipers or people that believe articles like these.
I work in a marketing company, the sales team and executives like iPhones and iPads. Most everyone else uses Android with a few people using iPad/iPhones. Yes people near the art industry have been using apple for decades and a few hipsters love Apple, but everyone else is starting to shift away.

Re:iPad developers vs. Android (4, Insightful)

whisper_jeff (680366) | more than 2 years ago | (#37197600)

iPad ... have devout worshipers that purchase as soon as their products come out. Android people are a bit pickier when it comes to buying something, they actually take time to evaluate the products instead of the hipsters who buy a label.

It simply boggles my mind that people continue to hold on to this gibberish. Here's a secret: Apple makes products people want. You can try to portray it as an army of mindless zombies shambling along giving Apple their money but the truth of the matter is that people buy products they want. Apple is succeeding (to say the least) because they have invested a lot of effort into figuring out what people want and making that product.

There's a reason why the typical geek has zero capacity to predict future trends and accurately determine what consumers want - because they hold onto falsehoods as if they're gospel and stick their heads in the sand when the truth is shown to them.

You don't have to like Apple (and your comments make it perfectly clear that you don't) but you're a blind fool if you ignore the reasons for Apple's success. You complain about Apple "worshipers" yet your disdain for Apple and its customers is the only fanatical thing I see here.

Re:iPad developers vs. Android (0)

jedidiah (1196) | more than 2 years ago | (#37197918)

It's not gibberish.

Apple is currently fed by conspicous consumers constantly buying the current season's product. They buy it just to show it off. They might not even use it.

When a new Apple revision comes out. The groupthink is not "Meh, this is just another minor hardware upgrade". No. The groupthink tries to spin a slight upgrade into something rediculously profound. You see this with Mini revisions and you see this with iPad revisions. There is not quite the "media cult" thing going with Android. It's like PCs. A new device has to struggle for attention in a crowded field. It won't get elevated by the press (tech or otherwise).

Apple just plain gets gobs of free advertising posing as journalism.

Whether or not you describe the situation in inflammatory terms, "cult" a good way to describe it.

Same reason Verizon still exists (1)

CAIMLAS (41445) | more than 2 years ago | (#37197396)

This is the same reason Verizon still exists and, until recently, why people put up with sub-par phones. Simply put, the phones were cheap or free, and people put up with the higher usage costs (say, akin to fewer apps/less usability) because of the diminished up-front cost.

If tablets were to segment as PCs did in the early 90s and offer "cheap" variants (eg. a tablet with 4G of storage and half as much RAM, maybe), maybe with cheaper displays, they would be adopted quite quickly, I think.

Re:Same reason Verizon still exists (1)

roc97007 (608802) | more than 2 years ago | (#37197768)

Somewhat agree, but ram is dirt cheap right now and the cost of storage options in these devices is being kept artificially high by marketing rather than by parts costs. Make cheaper tablets, but with storage that more properly reflects how cheap 64 bits of flash truly is, and you might have something.

This is where Apple is vulnerable -- a significant part of their profit margin depends on people's perception that buying a device with 16 additional gigabytes should cost $110 more, and it just isn't true anymore and hasn't been in awhile. If someone like Lenovo started pumping out cheap tablets that have storage that *start* at the highest storage Apple offers, *and* included an SD card slot, I think people would pay attention.

Getting developers (1)

JohnG (93975) | more than 2 years ago | (#37197566)

Getting developers to Android tablets isn't just a matter of getting more units out there than iPad. There are already more Android phones out there than iPhones, but there is still more money to be made on the iPhone than on Android. What Android needs to do is get the type of users that are willing to pay for apps. iPhone users pay for apps. Even Rovio didn't want to release Angry Birds on Android because they didn't think enough Android users would be willing to pay for it. Maybe Rovio can afford to support themselves on ad revenue, but the average developer is going to have it much harder.

Re:Getting developers (0)

Anonymous Coward | more than 2 years ago | (#37197846)

You are talking as if Android had a problem. Android is doing fine. It is winning the smartphone war (outselling the iPhone about 2:1) and many analysts predict that the same will happen to the tablet market sooner or later. You need to understand that some users don't want to pay for apps. There are now more free apps in the android market than in Apple's app store. What you seem to be referring to might be a problem for a developer willing to sell apps for Android, but it's clearly not a problem for Google, the smartphone makers, or the users of the Android platform. I've never seen a single paid iOS app that I would have bought anyway.

Proof in the price (1)

Anonymous Coward | more than 2 years ago | (#37197604)

It makes you just wonder; like it or not; that Android OS would be the #1 smartphone platform (by volume) on the market had the hardware cost not been subsidized by the phone companies giving the iPhone like devices away for next to nothing (e.g. buy one get one). Just look at the two top selling smartphones #1 iPhone 4 #2 iPhone 3GS this past quarter. I think it shows that people buy stuff that works, is supported and like it or not they don't give a rats a$$ about "tinkering"

http://isource.com/2011/08/22/iphone-4-and-iphone-3gs-found-to-be-best-selling-smartphones-in-us/

LOWER THE PRICE!!!! (1)

roc97007 (608802) | more than 2 years ago | (#37197794)

Lower the price! Lower the damned price. You have to be a boutique item to charge boutique prices, and the Android tablets aren't, yet, and may never be. As long as they try to go toe-to-toe with Apple on profit margins, they're only going to appeal to people who absolutely wouldn't own an Apple product but still need some kind of tablet device. Oh, as they fail one by one they'll come up with a variety of excuses, but the real reason is that the devices are too expensive for what the public perceives them to be.

HP failure, not patient and overpriced. (0)

Anonymous Coward | more than 2 years ago | (#37197822)

The tablet market TODAY consists mainly of the IPad for a few reasons. It has been on the market longer, is made by Apple so everyone knows it is cool, and there are more applications available. Other tablets can make inroads into this market by being less expensive, waiting for more applications to be available for their O/S and by supplying features that are wanted & not available with an IPad,
There are tablets that offer keyboards, USB, etc and other goodies not offerred by Apple.
Can't do too much about the Apple coolness, but a mfg could build devices that are solid and feel right.
There are application available for these other tablets that Apple would never permit in their market.
Android is still adding applications of one type or another in great numbers, most of the application types are already available on IPad.
HP major failures were to overprice its tablets and not being patient enough (at least 1 to 2 years) to compete in this market. In addition, HP also tried to use WebOS instead of Android which means that it takes longer for applications to be developed or ported.
I really question the idea that it cost HP $318 to manufacture a tablet when there are android tablets (mostly cheap Chinese knockoffs ) that can be purchased for less than $150 retail. Not saying that these knockoffs have the stuff that it takes, but the cost difference between these and the claimed HP cost is considerable. I think HP overpriced their tablets instead of pricing them at a more reasonable entry point and being patient in the market.

Get one (1)

builtbybison (2443934) | more than 2 years ago | (#37197894)

Go to the shop and buy one they have already crammed android 2.2 into one so it is technically possible, how long till a cracked version comes out, not long! check more news about it here [tumblr.com]
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