Could Pricing Topple the iPad? (AAPL)
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According to CNET over the weekend, the recent fire sale of Hewlett-Packard's (NYSE: HPQ) TouchPad over the weekend might be a signal consumers are indeed hungry for tablet PCs -- but at a price.
Cutting the price to $99, Best Buy (NYSE: BBY) saw shoppers line up outside waiting to get their hands on the device. It's not clear what the final sales numbers for the TouchPad were, but we're guessing all or close to.
CNET notes the reaction was astounding considering there was only 12 hours notice given. Conversely, Apple (Nasdaq: AAPL) generally provides months of hype for its products. Of course, Apple's products get a line up at launch, rather than just on a pricing cut.
The point being made by the article is several-fold in essence. Firstly, people love Apple products, regardless of the price. With Apple's iPad and iPad 2, most customers went for the more expensive version containing the most memory and function. For Apple, price isn't necessarily the first factor considered... or even in the top five first considerations.
Second, there's a market for tablet PCs, and it's a hungry one.
Third, tablets are overpriced. With the saturation in the Google (Nasdaq: GOOG) Android-based tablet market, it makes Apple's iPad that much more coveted.
Fourth, laptops are still a heavy competitor to tablets.
So, CNET quotes a gentleman from Endpoint Technologies, who says it wasn't a product failure, it was a pricing failure. Further, he contends that if an underdog in the tablet realm is trying to gain a stronger foothold, why not use a massive marketing budget (somewhere in the hundreds of millions) and just subsidize the heck out of the tablet? You get the device into more people's hands, it gets them talking and used to your product, they'll potentially buy more of your product, and you'll get more revenues from software and apps.
For Hewlett-Packard, CNET notes the TouchPad had two key things going for it: platform and resources. The TouchPad was a self-contained, vertical platform, like Apple. Hewlett-Packard also had the size and resources for better pricing and marketing.
But, this is supposed to be about a potential iPad killer. That may come in the form of a beautiful, sleek, subsidized offering from Amazon (Nasdaq: AMZN). The retail giant supposedly already sells it's Kindle e-reader for a loss, and could come close to a $99 per tablet price. Amazon also has resources, and it's proven capable of making a desirable product.
Whether Amazon releases a tablet isn't a question, it's whether it's willing to gamble with pricing where a shift in power may occur.
Apple is 1.7 percent better on the session, while Amazon is 3.1 percent stronger.
Cutting the price to $99, Best Buy (NYSE: BBY) saw shoppers line up outside waiting to get their hands on the device. It's not clear what the final sales numbers for the TouchPad were, but we're guessing all or close to.
CNET notes the reaction was astounding considering there was only 12 hours notice given. Conversely, Apple (Nasdaq: AAPL) generally provides months of hype for its products. Of course, Apple's products get a line up at launch, rather than just on a pricing cut.
The point being made by the article is several-fold in essence. Firstly, people love Apple products, regardless of the price. With Apple's iPad and iPad 2, most customers went for the more expensive version containing the most memory and function. For Apple, price isn't necessarily the first factor considered... or even in the top five first considerations.
Second, there's a market for tablet PCs, and it's a hungry one.
Third, tablets are overpriced. With the saturation in the Google (Nasdaq: GOOG) Android-based tablet market, it makes Apple's iPad that much more coveted.
Fourth, laptops are still a heavy competitor to tablets.
So, CNET quotes a gentleman from Endpoint Technologies, who says it wasn't a product failure, it was a pricing failure. Further, he contends that if an underdog in the tablet realm is trying to gain a stronger foothold, why not use a massive marketing budget (somewhere in the hundreds of millions) and just subsidize the heck out of the tablet? You get the device into more people's hands, it gets them talking and used to your product, they'll potentially buy more of your product, and you'll get more revenues from software and apps.
For Hewlett-Packard, CNET notes the TouchPad had two key things going for it: platform and resources. The TouchPad was a self-contained, vertical platform, like Apple. Hewlett-Packard also had the size and resources for better pricing and marketing.
But, this is supposed to be about a potential iPad killer. That may come in the form of a beautiful, sleek, subsidized offering from Amazon (Nasdaq: AMZN). The retail giant supposedly already sells it's Kindle e-reader for a loss, and could come close to a $99 per tablet price. Amazon also has resources, and it's proven capable of making a desirable product.
Whether Amazon releases a tablet isn't a question, it's whether it's willing to gamble with pricing where a shift in power may occur.
Apple is 1.7 percent better on the session, while Amazon is 3.1 percent stronger.
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