Greg's Bite: HP Touch Pad "Like Nothing Else"?
TweetFollow Us on Twitter

Greg's Bite: HP Touch Pad "Like Nothing Else"?

By Greg Mills

The illustration is an exploded view of the HP TouchPad.

For those developers thinking about developing apps for the Palm OS, which runs on HP's TouchPad, think a bit longer. Sales figures just are awful on HP's latest iPad killer that isn't. If you thought the Microsoft Kin cell phone was a success, you will really love the HP TouchPad. HP's slogan for the TouchPad, "Like Nothing Else," can sarcastically be interpreted by consumers as "nothing like an Apple iPad."

The Wall Street Journal's "All Things Digital" reports that of the 270,000 HP TouchPads Best Buy ordered, they have sold less than 25,000. Internal reports are that the 25,000 sold number does not include TouchPads that have been sold but returned for various reasons. (See http://allthingsd.com/20110816/ouchpad-best-buy-sitting-on-a-pile-of-uns... .)

Similar stories of dismal TouchPad sales from Wal-mart, Frys and numerous other electronics retailers confirm the HP TouchPad appears to be a flop. A very expensive and embarrassing flop for HP, which is reporting quarterly sales after the markets close today. If the Palm-based touch screen tablet HP calls TouchPad fails, what of Palm? Unless HP sells smartphones that run the Palm OS, the purchase of Palm was a complete waste of US$1.2 billion.

According to the ATD story, Best Buy wants to return the mountain of unsalable TouchPads and is refusing to pay for them. Retailers have contracts that protect them from albatrosses like Microsoft Kin Phones and HP TouchPads. "Loading the sales channels" with merchandise is great when the products go out and agonizing when the sewer backs up with unsalable merchandise that cost a fortune to manufacture.

The teardown of the HP TouchPad by iSupply indicates that the baseline TouchPad costs HP roughly $306 to manufacture (see http://allthingsd.com/20110703/hps-touchpad-teardown-its-deepest-secrets...). This makes the numbers more meaningful.

If the newly discounted $399 retail price holds (and it may not hold) and Best Buy and the other electronics stores make a 40% markup or about $160 per TouchPad, HP will eat roughly $60 for each TouchPad sold and the full $306 for each TouchPad they don't ever sell.

HP has cut the price to encourage sales to little effect, according to sources in the industry. A store named Woot dropped the sales price of the entry level TouchPad $120 and only sold 612 units. Staples virtually gave HP TouchPads away dropping $200 off the original price and still couldn't move them. Eventually, the actual market price will be reached, but it looks like pricing HP TouchPads low enough to sell will mean HP loses money selling them at less than the cost to make them. Ouch, looks like more blood in the water for the iPad.

HP's biggest problem is that unlike Apple, they don't have a well developed source of latent income from TouchPads they sell. Apple sells tons of iPads and knows they will sell apps that will be loaded onto that iPad for years to come and Apple pockets 30% of the long term income. Apple will also sell music, videos and books to that iPad empowered consumer.

What will HP sell to the owners of a TouchPad? Expensive ink cartridges? Should HP stem the flow of red ink and discontinue the TouchPad line of tablets, consumers will be stuck with expensive junk and have the lesson reinforced that buying into a platform that fails is a serious mistake. This means that the other marginal platforms will also see skeptical consumers who don't want to be stuck with junk. If you really want an iPad, buy an iPad, not a PlayBook or some other pretender.

In desperation, HP may bundle the TouchPad with laptops and hope to clear the clogged channel with back to school sales. This is hardly the vision HP had for its answer to Apple's touch screen magic. This also supports my observation that there isn't room in the market place for so many touch screen platforms. Though the Palm OS has merit, Android and the Apple iOS have sucked the air out of the room for also-ran platforms like Palm and RIMs proprietary OS. The jury is still out for Microsoft's Mobile OS that might surge if Android is fragmented by Apple.

Understanding the marketplace has no room for so many platforms is why the CEO of Nokia threw up his hands and stopped wasting money on its in-house OS despite years of research and countless millions of dollars that are now wasted. Going to a platform that is going to be around when it all shakes out is the intention of both consumers and savvy developers alike.

That is Greg's Bite out of HP's hide for today.

 

Community Search:
MacTech Search:

Software Updates via MacUpdate

Latest Forum Discussions

See All

Soft Drummer (Music)
Soft Drummer 1.0 Device: iOS Universal Category: Music Price: $14.99, Version: 1.0 (iTunes) Description: Soft Drummer is the closest thing to a pro session subtle drummer in your pocket. Easy to use and fast, it's much more than a... | Read more »
Is GO Gear the Pokemon GO map app you...
Now that we've settled into something of a Pokemon GO status quo, the number one desire of most players can best be summed out by modifying a quote from Rod Tidwell of Jerry Maguire: "Show me the Pokemon!" [Read more] | Read more »
Rodeo Stampede update: Mountains, new an...
The Savannah and Jungle were just the beginning in Rodeo Stampede. Get ready to head for the Mountains. I think I heard that in a beer ad once. [Read more] | Read more »
COSMOS RINGS (Games)
COSMOS RINGS 1.0.0 Device: iOS iPhone Category: Games Price: $5.99, Version: 1.0.0 (iTunes) Description: This game cannot be played without the Apple Watch.Released anniversary sale until August 31,2016 PST! A tragic tale of time's... | Read more »
How to get started selling on Mercari
As far as ecommerce has come over the last decade or so, there's still a tremendous opportunity to make it easier for people to buy and sell goods. That's especially true when it comes to shopping apps, which should only continue to increase in... | Read more »
Human Anatomy Atlas 2017 Edition - Compl...
Human Anatomy Atlas 2017 Edition - Complete 3D Human Body 1.0.24 Device: iOS iPhone Category: Medical Price: $24.99, Version: 1.0.24 (iTunes) Description: | Read more »
Heroes of Normandie (Games)
Heroes of Normandie 1.5 Device: iOS Universal Category: Games Price: $14.99, Version: 1.5 (iTunes) Description: The game does not support iPhone 4s and below | Read more »
Why you should never power up Pokemon in...
There's no question that candy is dandy in Pokemon GO. You need big quantities of it to evolve your Pokemon, and when combined with stardust, it can be used to power up your favorite pocket monsters as well, making them more formidable for the gym... | Read more »
Webzen launches 3D MMORPG MU Origin on i...
Mu Origin is featured time and time again at the very top of App Stores in China, and within the top five worldwide top-grossing charts on Google Play.Its popularity in Korea and China, featuring more than 120 registered players in China and 6... | Read more »
Severed (Games)
Severed 1.0 Device: iOS Universal Category: Games Price: $5.99, Version: 1.0 (iTunes) Description: LAUNCH DISCOUNT ON NOW!! ENDS AUGUST 4! ==== Take control of a one-armed warrior named Sasha, wielding a living sword on her journey... | Read more »

Price Scanner via MacPrices.net

9-inch 32GB Space Gray iPad Pro on sale for $...
B&H Photo has the 9″ 32GB WiFi Space Gray Apple iPad Pro on sale for $50 off MSRP including free shipping. B&H charges sales tax in NY only: - 9″ Space Gray 32GB WiFi iPad Pro: $549 $50 off... Read more
15-inch Retina MacBook Pros on sale for up to...
B&H Photo has 15″ Retina MacBook Pros on sale for up to $200 off MSRP. Shipping is free, and B&H charges NY tax only: - 15″ 2.2GHz Retina MacBook Pro: $1849 $150 off MSRP - 15″ 2.5GHz Retina... Read more
Second-Quarter Tablet Shipments Fell 4.8% –...
The latest report from the global market research firm TrendForce finds that worldwide tablet shipments for this second quarter totaled 33.54 million units, representing a quarterly drop of 4.8% and... Read more
Global Smartphone Sales Volumes Mark Second S...
According to preliminary results from the International Data Corporation (IDC) Worldwide Quarterly Mobile Phone Tracker, vendors shipped a total of 343.3 million smartphones worldwide in the second... Read more
Apple TVs on sale for $20-$40 off MSRP
Best Buy has 32GB and 64GB Apple TVs on sale for $20-$40 off MSRP on their online store. Choose free shipping or free local store pickup (if available). Sale prices for online orders only, in-store... Read more
Mac minis on sale for $50-$100 off MSRP
B&H Photo has Mac minis on sale for $50 off MSRP including free shipping plus NY sales tax only: - 1.4GHz Mac mini: $449 $50 off MSRP - 2.6GHz Mac mini: $649 $50 off MSRP - 2.8GHz Mac mini: $949... Read more
Clearance 2015 13-inch MacBook Airs available...
B&H Photo has clearance 2015 13″ MacBook Airs available for $300 off original MSRP. Shipping is free, and B&H charges NY sales tax only: - 13″ 1.6GHz/4GB/128GB MacBook Air (MJVE2LL/A): $799... Read more
Apple certified refurbished iPad mini 4s avai...
Apple has certified refurbished iPad mini 4s now available for up to $120 off the cost of new models. An Apple one-year warranty is included with each iPad, and shipping is free. The following models... Read more
Notebook Makers In No Rush To Adopt USB-C – R...
Digitimes’ Cage Chao and Joseph Tsai note that while the USB Type-C interface is enjoying growing popularity among smartphones and tablet makers, notebook and all-in-one (AIO) PC vendors (other than... Read more
iMacs on sale for up to $250 off MSRP
B&H Photo has 21″ and 27″ Apple iMacs on sale for up to $250 off MSRP including free shipping plus NY sales tax only: - 27″ 3.3GHz iMac 5K: $2049 $250 off MSRP - 27″ 3.2GHz/1TB Fusion iMac 5K: $... Read more

Jobs Board

*Apple* Solutions Consultant - APPLE (United...
Job Summary As an Apple Solutions Consultant, you'll be the link between our future customers and our products. You'll showcase your entrepreneurial spirit as you Read more
Lead *Apple* Solutions Consultant - APPLE (...
Job Summary The Lead ASC is an Apple employee who serves as the Apple business manager and influencer across a number of Reseller locations. The Lead ASC's role Read more
*Apple* Retail - Multiple Positions, Charles...
Job Description:SalesSpecialist - Retail Customer Service and SalesTransform Apple Store visitors into loyal Apple customers. When customers enter the store, Read more
*Apple* Retail - Multiple Positions, Willow...
Job Description:SalesSpecialist - Retail Customer Service and SalesTransform Apple Store visitors into loyal Apple customers. When customers enter the store, Read more
*Apple* Evangelist - JAMF Software (United S...
The Apple Evangelist is responsible for building and cultivating strategic relationships with Apple 's small and mid-market business development field teams. This Read more
All contents are Copyright 1984-2011 by Xplain Corporation. All rights reserved. Theme designed by Icreon.