The TouchPad Lives! Momentarily! Or Eventually! Possibly! I Hope So!
By Harry McCracken | Tuesday, August 30, 2011 at 4:32 pm
Not too long ago, HP was laying out its vision for its then-new TouchPad tablet. It involved the company’s dedication to making the TouchPad a success, and–everyone at HP who I spoke with repeated this word until it rang in my ears–the “scale” the giant company could being to the effort. The strategy was ambitious and clear.
Then, week before last, HP abruptly responded to disappointing initial sales for the new tablet by killing it. That was depressing. But clear.
Then it decided to blow out the remaining Touchpads for $99 apiece. Poignant. And understandable, at least. I mean, it’s better than dumping them in landfill.
Here’s where I get confused…
- HP’s Mark Budgell says that the company was “pleasantly surprised” by the response to the $99 TouchPads. And so it’s going to make some more TouchPads. After saying it was done making TouchPads.
- Todd Bradley, who heads up HP’s possibly-to-be-spun-off-or-sold PC group, says that “Tablet computing is a segment of the market that’s relevant, absolutely” and that (according to the LA Times) “HP could bring back the TouchPad or offer up a different tablet at a later date.”
- The official HP TouchPad site doesn’t seem to acknowledge the tablet’s current situation. It says that “bazillions” of WebOS apps are on their way. (Hey, can you let me know when they get here?)
Is it so startling that the TouchPad is selling well at 80 percent off its original price? And is HP planning to make more TouchPads, sell them at $99, and lose hundreds on every sale? If so, why? And why not sell $1000 laptops for $200 as long as they’re at it?
If tablets are relevant, why did HP decided to get out of the game six weeks after getting into it? Doesn’t entering the market, leaving it, and then saying you might re-enter it make you look, um, indecisive?
Look: I think that tablets are going to make top a meaningful percentage of the PC market from here on out. If I owned the world’s largest PC company, I’d want to make tablets. There may be a plausible argument for not getting into the market, too. But coherency is important. And HP’s tablet strategy, if it has one, is growing less coherent by the day.
When HP spent months bragging about the resources and dedication it would bring to the tablet market, and then gave up the moment the tablet didn’t do well–which wasn’t surprising given how buggy it was–it damaged its own credibility. (The next time HP announces something inventive and cool, I won’t blame anyone who asks whether it’ll stay on the market for longer than the TouchPad did.)
I was rooting for WebOS. I thought the TouchPad had promise. I’d love to see a surprise happy ending to this whole saga. (If HP holds a press conference tomorrow and announces it was just kidding about that whole killing-the-TouchPad thing, I’ll cheer.) But wouldn’t it be better if HP said nothing at all about its tablet plans until it has something to say that makes sense and stays true for more than 72 hours?
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August 30th, 2011 at 4:49 pm
They are only making more because it was part of the supply to until the end of the year, as in TPs already on order. The Touchpad lives because there will be at least a million owners.
August 30th, 2011 at 5:03 pm
What respectable company dumps a new product in less than 60 days. Clueless!
August 30th, 2011 at 5:23 pm
Or perhaps HP is suffering an extension of the leadership vacuum
August 30th, 2011 at 5:45 pm
This was pre-planned. Plain and simple. I don't know why they would take this path that seems so destructive to their image, but I know they thought the advantages. The thought may have gone like this:
-We Need to get WebOS in the hands of people. We need to get developers to care about it, too.
~How can we do that? The people want the iPad, they don't care about tablets.
-People will buy anything if it is cheap.
~We can't undercut the iPad, and make as good of a product.
-We'll make a product that is almost as good, sell it for just as much as the iPad.
~I'm not following
-Listen! Then we will pretend to abandon the Touchpad, but not WebOS, and put it on liquidation for a ridiculously low price. People will buy it, because it is so cheap and it is almost as good as the iPad. We will then have it in a lot of people's hands, and developers will flock because there are actual users of WebOS.
-We will then really work on a good plan for WebOS, get all of the kinks out and continue to release updates to current owners.
-And because there will be such a demand for a new tablet/phone, we will design an awesome tablet.
~Won't we lose money for long time?
-Who cares? We're HP!
August 30th, 2011 at 6:19 pm
This whole HP thing is fun as a spectator sport. I'm quite happy that I'm not on the playing field, though.
August 30th, 2011 at 8:12 pm
Depending on how much inventory of component parts they already have in stock or have contractually agreed to purchase and on their manufacturing labor cost, it's possible that HP may actually lose *less* money by using up its existing inventory of parts to manufacture and sell TouchPads at $99 than to liquidate or ditch the component parts at a return of less than that.
August 30th, 2011 at 8:23 pm
I think your graphic should have "Grand Opening / Going out of Business Big Combo Sale – We've slashed prices, divisions, and product lines. We're going all out to redefine 'incredible'!"
August 31st, 2011 at 6:44 am
"wouldn’t it be better if HP said nothing at all about its tablet plans until it has something to say that makes sense and stays true for more than 72 hours?"
Absolutely. I'm so glad not to be an employee, major customer, partner, or supplier of HP at the moment. Their many competitors are laughing all the way to the bank as they take calls from HP's panicking suppliers offering great deals. I wouldn't be surprised to hear that their competitors' sales are increasing, too, as HP's customers jump ship instead of going down with it. So, competitors' profits should jump as they get more sales and cheaper suppliers.
August 31st, 2011 at 8:24 am
Platt was the last competent CEO at HP. Not coincidentally, he was the last engineer to hold the position…
August 31st, 2011 at 11:53 am
I think HP has some great ideas, but for some reason is being given this great recognition in the market. Ue Creoq are considering withdrawing from the world of the tablets. I hope not.