HP TouchPad price plunge as iPad sitting pretty
Hewlett Packard's TouchPad has failed miserably in its bid to challenge the Apple iPad's market share.
A mere 12,000 were sold in the first month of European release, a figure which fell even further in the weeks that followed. After seven weeks, it was announced that the TouchPad would be discontinued -- a humiliating retreat by an already ailing company.
But when retailers were told they could sell the remaining tablets at a quarter of the original price -- $99 (€71), instead of the iPad price-matching $399 and $499 -- TouchPad's fortunes began to magically turn around. The sum was not enough to cover manufacturing costs, but was sufficient to prompt a buying bonanza. Cut-price TouchPads flew off the shelves, with lengthy queues forming outside stockists and websites experiencing frenzied demand.
So it was that Hewlett Packard yesterday found itself performing yet another U-turn. In an entry posted on the company's blog, it announced that after being "pleasantly surprised" by sales of the cut-price tablet, it would be returning the TouchPad to the market on a temporary basis.
"The speed at which it disappeared from inventory has been stunning," the statement explained. "We have decided to produce one last run of TouchPads to meet unfulfilled demand." The run will be limited to North American retailers only.
As technology bloggers have pointed out, the $99 TouchPads may be popular, but they're still not going to be profitable. Hewlett Packard is thought to be losing some $200 on every device sold.
Why it has decided to embrace the loss-making product is the subject of some speculation. Reports from Taiwan indicate that it may have to do with surplus parts held by manufacturers, while others have suggested the move is an attempt to garner a few positive headlines after months of negative press.
Critics have described it as "a triumph of madness over common sense", arguing that it adds to its reputation for indecision.