CNET interviews Roger Kay, principal analyst at Endpoint Technologies, about the buying frenzy kicked off by the $99 price tag on the HP TouchPad. Kay believes that this challenge to the iPad market dominance should give Apple pause:
Kay explained. “If you were a big company like HP and you were doing a new category product launch, it would not be weird to have a marketing budget in the hundreds of millions,” he said in a phone interview. “So, you could have used that money to subsidize the price of the TouchPad and you can flood the market with these devices that are worth way more than you have to pay for them. And get them in everybody’s hands. Get everybody talking about it. That could have been the loss leader entry into the market,” he said.
“So, it wasn’t really a product failure, it was a pricing failure.”
Fascinating point, and not unprecedented. Remember that the PS3 is sold at a less-than-cost price point because Sony makes much more off the games and subscriptions. Another tablet manufacturer may just take the hint.
If so, I would certainly be tempted to buy one. The Apple is pretty, but far too expensive for a toy. And the screen is just too small to be anything but an extension of the dual monitor setup of today’s knowledge worker.