HP's Discontinued TouchPad Selling Fast

Barry Levine, <a href='http://www.newsfactor.com'>newsfactor.com</a>

The good news for HP is that its TouchPad tablet is finally selling like hotcakes. The bad news is that the company isn't making any more TouchPads.

The TouchPad, which had been selling at $499 for the 16GB model and $599 for the 32GB when it launched on July 1, is now being offered at $99.99 for the 16 GB and $149 for the 32GB -- while they last. HP's Web site has sold out of the product, as have Best Buy stores. Both companies said they would give a price match to any customers who bought the TouchPad at its previous prices.

The Right Price

Only last week, Best Buy reportedly had told HP it wanted to return the unused stocks of tablets, having sold only 25,000 of 270,000 units in its inventory. Hewlett-Packard resisted, and began implementing a variety of discounts to spur sales.

Then, late last week, HP announced it was discontinuing all of its webOS-based hardware by the fourth quarter, including its Veer and Pre smartphones as well as the TouchPad. According to Cathie Lesjak, HP's CFO, the software side of the webOS platform is not being shut down.

Ross Rubin, director of industry analysis for consumer technology at The NPD Group, said the $99 price was a "different value proposition" in the mind of consumers, a price point where they're willing to take a chance -- even on a discontinued product. By comparison, he noted, the original $499 price raised questions in consumers' minds about whether a purchase would pay off in the long run.

Other Uses for webOS

Rubin noted that "it's unusual" that a product like the TouchPad would be pulled so soon after its launch. The company had hoped to position the TouchPad as the key competitor to Apple's category-defining iPad, a position that is still up for grabs. Tablets such as Samsung's Galaxy Tab and Barnes & Noble's Nook Color "have sold pretty well," he said.

Unless HP is successful in licensing webOS to other devices, purchasers of the TouchPad could find themselves with a futureless platform. But some developers have announced on the Rootz Wiki that they are working to bring Android to the TouchPad, an effort that has been dubbed "TouchDroid."

The Wall Street Journal reported last week that the company was working to have appliance and car manufacturers use webOS in their products. HP Chief Executive Leo Apotheker had said earlier this summer that HP would begin talks with other companies about licensing webOS.

HP acquired webOS when it bought Palm in 2010 for $1.2 billion. At the time, the company touted webOS as one of the key reasons for the purchase. Some industry observers have speculated that, in lieu of webOS products, HP might choose to capitalize more heavily on the webOS-related patents.