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HP's $99 TouchPad Fire Sale Can Teach Everybody A Lesson

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Re: HP's $99 TouchPad Fire Sale Can Teach Everybody A Lesson

#31

Post by hackernewz »

HP, with their non-Android based WebOS, was the only company capable of making a dent - or a beachhead - against iPad sales. When you have two parties making h/w and s/w for a tablet all you get is finger pointing and blame when problems arise. My LG Optimus smartphone crashes/reboots about once a week. Nobody takes responsibility. I cannot pay $50 to get Android 2.3 or 3.0. As soon as I buy the device the support is gone. It's the disposable feature-phone market all over again, but this time with tablets and Android.

It's not always the tech or sexiness of the Apple brands that attract people, it's their commitment to fixing bugs. (I'm not saying they're superb at it, but nobody else seems to be trying at all)

Re: HP's $99 TouchPad Fire Sale Can Teach Everybody A Lesson

#32

Post by duopixel »

Charles Eames once said that reducing the cost often makes a product more useful, if quality is not compromised. I was intrigued, but I couldn't find a tangible example of it.

Now we have one: suddenly it's not stupid to stick a tablet to your fridge for convenient online grocery shopping, or in your home office as a display for monitoring your servers. At a $99 price point it makes it useful using it even as a digital portrait!

Re: HP's $99 TouchPad Fire Sale Can Teach Everybody A Lesson

#33

Post by jsz0 »

The best strategy for this would be to do a contest or limited daily deal sort of offer. You would never have to slap a reduced price next to your device so people won't feel entitled to get the reduced price indefinitely. We live in an era with Internet riots over a $7 NetFlix price increase after all. With a contest/daily deal type of offer you would have people going out of their way to register on your site everyday to win. All the tech sites will give you tons of free advertising. Give the winners the free, or heavily discounted, device and upsell them on accessories in the process. Throw in $10-$20 worth of App Store credits to make developers very happy.

Re: HP's $99 TouchPad Fire Sale Can Teach Everybody A Lesson

#34

Post by anigbrowl »

hackernewz wrote: post #24
jasonfried wrote: post #12

I wonder if people understand they are buying a discontinued product that will see no future development. Is that being made clear by the retailers?

Sort of like every Android 2.2 phone ever sold? Has anyone every seen an OS upgrade on their Android Smartphone?

Yes, as has my brother-in-law - 2 different phones, networks, vendors. I have a Nexus one, he has a Droid of some sort.

Re: HP's $99 TouchPad Fire Sale Can Teach Everybody A Lesson

#35

Post by endlessvoid94 »

Isn't this exactly what console manufacturers did? Microsoft took a huge loss on the original xbox (and the 360?) and made a shitload of money on the xbox live + a few in house games. In short, they created a platform/ecosystem and took a loss up front.

It's riskier, and can only be done by companies that have significant runway. But it's likely the only way to compete with someone like Apple, who has an enormous domination in the current market.

Re: HP's $99 TouchPad Fire Sale Can Teach Everybody A Lesson

#36

Post by anigbrowl »

TomOfTTB wrote: post #3

I've seen this written by a couple of different people over the weekend and it terrifies me every time. It's as if the author is completely divorced from reality. As if "just price it lower" is some kind of poignant observation that no one thought of. As if it were easy to compete on price when Apple is buying parts in quantities you couldn't hope to match. I'm always critical of people who make the argument that "fr…

I think people imagine it's like safety razors - sell the razor cheap, make money on the blades. The same strategy has worked for printers, where the real money is in ink or toner cartridges, and with phones, where the profit is in selling connection time/bandwidth over a 2 year contract. After all, Apple takes a cut of all sales through the app store and iTunes store, so some tech writers assume that that will work for anyone (even though it's taken Apple the best part of a decade to build the required infrastructure and the company had positioned its products at the top of the market almost since inception).

Re: HP's $99 TouchPad Fire Sale Can Teach Everybody A Lesson

#37

Post by sciurus »

roc wrote: post #29
wvenable wrote: post #13

Earlier quoted context omitted.

I think there's room in the market for an inexpensive web-only tablet. Before the Chromebook's came out, I had assumed that was what Chrome OS was for -- a real stripped down inexpensive tablet with almost no local flash, a small amount of RAM, etc. Most tablets right now are attempting to match the iPad in every way: capability, size, weight, etc. So, of course, they're in the same price range.

People are trying to match the iPad because even a stripped-down tablet is still going to have to cost ~$400. The extra RAM and Flash add what to the bill-of-materials? $25? If you could put together a $200 tablet, Negroponte would be declaring victory in the press, rather than quietly rolling back the date of the XO-3 over and over again.

Archos is selling their 10" tablet for $270. The 7" is $240. I've used one of the 10" models and found it fine for web browsing. Sadly, their new models coming out in September are said to cost $300 and $370.

https://store.archos.com/archos-internet-tablet-p-5005.html

Re: HP's $99 TouchPad Fire Sale Can Teach Everybody A Lesson

#39

Post by tomjen3 »

nkassis wrote: post #28
MatthewPhillips wrote: post #19

Earlier quoted context omitted.

You have to have very deep pockets, and the ability to pacify your shareholders, to absorb these types of losses. I think people are really underestimating how much HP has lost here.

Microsoft did it back in the day with the Xbox but I don't think it's a good strategy to use against a 70b in cash company who can match your prices to kill you. With that said if you did drive down the price for everyone Apple would be in trouble (so would everyone else but less due to their diversification). Imagine if we expect 300 tablets. That would be hard for a Apple to keep going on for a while, they managed…

Thing is, Apple has a lot of money now but MS can run deficits in the tablet business essentially forever. So can Google.

Half of Apples income is tablets. They can run for some time, but not forever.

Re: HP's $99 TouchPad Fire Sale Can Teach Everybody A Lesson

#40

Post by cube13 »

jerf wrote: post #30
Duff wrote: post #20

Earlier quoted context omitted.

Ultimately, price drives decisions. My neighbor doesn't understand why he can't sell his house. The reason is simple -- he's asking 25% more than the market price without giving people a compelling reason to spend the money. The Touchpad is telling you something about the iPad market (there is no such thing as a "tablet" market). People are willing to line up to spend $500 on an iPad. But they are also willing to spe…

That last one is why Amazon is the one to watch. They have a plausible "sell the Kindle-pad at a moderate loss" scenario, in that they have numerous for-pay services they can hawk from a privileged position on their tablet, and with Amazon Prime's integration with their video service, a plausible way to turn a Kindle-pad into a recurring revenue stream as well, a recurring revenue stream that encourages additional on…

I honestly don't think that Amazon or Barnes and Noble consider their devices to be iPad competitors, though. They're selling them as eReaders that just happen to be able to play Angry Birds, not as full-featured tablets.
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