HP took a major blow to their reputation and their net worth last week. Just 48 days after introducing their Touchpad tablet, they announced that they were pulling it from the market, due to dismal sales figures. To say that sales "failed to live up to expectations" would be an understatement. HP shipped 270,000 Touchpads to Best Buy. As of Friday, Best Buy sold approximately 25,000. Another source calls that estimate "charitable".
Realistically, at $499 for a 16GB model, why wouldn't you buy an IPad 2? That seems to be HP's problem. Apple currently has roughly 80-85% of the tablet market. There are over 90,000 apps available for the IPad currently, and over 250,000 IPhone/IPod apps that can be used on the IPad. It will take years for any tablet competitor to be able to say that, whether web or Android based. No one can compete.
Early Saturday morning, both Best Buy and HP's websites showed a price change on the 16 and 32GB Touchpad. The 16GB Touchpad was marked down from $499 to $99. Interestingly, the price change was done before Best Buy had a chance to change their print ad for Sunday, showing a 16GB model for $449. It appears that Best Buy sold their remaining 245,000 tablets by 8:14PM Sunday evening.
In the ultimate act of good faith/we release an inferior product, both HP and Best Buy announced that anyone that paid full price for their Touchpad after June 21st can come to the place of purchase, with a receipt, and be reimbursed for the difference...resulting in a $99 tablet.
Lesson to be learned: Never try competing with Apple. You will never win if you do. HP was just forced to sell off hundreds of thousands of tablets for $99 apiece; tablets which likely cost them $400-450 each to make. That's a $100 million loss only considering the stock that Best Buy had on hand. Ouch.
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