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HP TouchPad's History: Lessons Learned, Bidding Adieu

By , Jane McEntegart - Source: Tom's Hardware US | B 34 comments

The race to the virtual checkout is over. It's now time for some reflections on the Touchpad Firesale. HP's out of the tablet fight, but Google would do well to draw lessons from the eleventh hour TouchPad craze if it wants to unseat Apple as tablet king.

The TouchPad Firesale is dead. As you're no doubt aware, HP announced that its online inventory will not be replenished. Some retailers will have limited stock available, and they represent your absolute last chance to snap one up. After this, it's only going to be an eBay and Craigslist affair. If you've read HP TouchPad Review: A Tablet For Productivity?, then you know we're bloody impressed with the display and intuitive interface offered by webOS.

Unfortunately, the remaining deals we see are completely unattractive. Best Buy, for example, is offering the 32 GB TouchPad for $149, but you have have to purchase an HP or Compaq-branded notebook or desktop PC to qualify.

We're actually glad that this fiasco is finally over. HP has kept thousands on pins and needles waiting for the last batch of TouchPads to arrive from its ODM, Compal. Now that the craze is over, we can finally reflect on what went wrong. Clearly, there are many lessons that Amazon, Google, and Microsoft can learn to capture some of the same buying frenzy HP enjoyed at the 11th hour.

A Chronology of the Ill-fated TouchPad

Let's rewind the clock for a moment. How did we get here? HP formally launched the TouchPad this year on July 1st, and it became available in stores about a week thereafter. However, on August 18th, then CEO Leo Apotheker basically put the kibosh on all mobile HP products, and put webOS and the PC divisions under review.

It was that weekend that HP decided to liquidate the remaining inventory of its Pixis, Pres, and TouchPads. This set off a fury of internet activity on deal sites like SlickDeals, as consumers sought to grab a cheap tablet. HP's shopping site was hammered like it was under a DoS attack and then people turned retailers.

Amazon put both TouchPad up as Lightning Deals, and each model sold out within five minutes. Other stores like Newegg were caught completely unprepared to honor the $99 (16 GB) and $149 (32 GB) pricing. People were buying the TouchPad at the normal price and hoping for a price adjustment down the road. Frankly, the buying frenzy was unbelievable, because many consumers saw this as the best deal in years, even including Cyber Monday.

Those shopping at stores like Best Buy fared no better, because fresh shipments turned up in the early morning from the company's distribution centers on specific days. As a result, the stores shelves were basically bare after the first day unless you were willing to line up early like it was Black Friday.

The deal was so good that even a few of us at Tom's Hardware got in on the action. Between three staff members, we snapped up six TouchPads. Why? Because pricing counts for an awful lot. Even among those of us with iPads, iPad 2s, and Honeycomb tablets, a $100 tablet is cheap enough that you can put it on the coffee table as a "guest tablet." It's a small loss if it breaks.

Plus, it's a gonna be a great holiday gift, a device literally worth more than it actually cost. This is a sentiment shared by many on our Facebook page. According to IHS iSuppli teardown analysis in August, HP's cost to build a 32-gigabyte TouchPad is $328.65. At $149.99, the company takes a loss of more than $178 per unit.

To give you an idea of the sheer craziness, we only need to look at Twitter. Bryna Corcoran, Social Media Strategist for HP, was the primary liaison for company updates regarding the #hptouchpad and #firesale hash tags during the first week. The number of followers on her account started out at less than 500 prior to the liquidation and quickly ballooned to about 10 000 just within a matter of days. Now two months later, she's arguably the most popular HP employee on Twitter.

Lessons Learned

Of course, the TouchPad Firesale was a one time deal. It's not likely to be repeated. However, it would be foolish for tablet vendors not to learn from HP's mistakes. For the moment, we're now down to two tablet players: Apple and Google, but there's no question that Apple continues to dominate. While Google is making decent headway with its Honeycomb-based tablets, the company still faces an uphill battle. Windows 8 looks to be an interesting pitch from Microsoft to make headway into the tablet market, but we're really not going to see products until 2012.

There are some valuable lessons to be gleaned from HP's decisions over the past few weeks. Even we were surprised by the number of folks desperate to get their hands on a TouchPad for $100. Our friends at AfterDawn report that HP sold nearly 350 000 units in the first weekend of the firesale. Consider the following:

  • Apple sold nearly 1 million iPad 2s during its debut weekend. (Source: Bloomberg and Reuters)
  • HP only sold 20 000 to 25 000 TouchPad during its first weekend. (Source: All Things Digital and Business Insider)
  • HP reportedly only produced somewhere between 600 000 and 800 000 TouchPads. (Source: WSJ)


Clearly, price is still the reason more folks aren't buying tablets. Anyone who bought a discounted TouchPad wanted a simple device for Web browsing. But once those folks start playing with their new toys, they're going to want to start buying apps, too. That's something that would have attracted developers in droves, had it happened before HP assassinated its platform.

Tablet manufacturers often peg Apple as their competition. But that's really a mistake. If your storefront isn't as complete as the App Store, gunning for the iPad 2's price point seems like a fatal strategy. Although HP is losing millions by liquidating whatever TouchPads it still has, it taught everyone that people will rush to pay for lower-priced tablets. If tablet vendors want to see better adoption, they need to look to lower prices. As one user on SlickDeals posted, "I don't even know why I bought this but for $99, it was too good of a deal to pass up."

According to a recent IHS iSuppli survey, 79.2 percent of tablet owners confirmed owning either an iPad or iPad 2, and 50 percent of those shopping for a new tablet said they would by an iPad 2. If Google wants to make a serious dent in Apple's position, it needs to subsidize lower tablet prices, which will, in-turn attract more developers. Had HP done this right from the start, it probably wouldn't have found itself in the situation it's in now. 

Until tablets become so cheap that we just can't help ourselves but to buy one (like the SlickDeals guy), there are three main points that tablet manufacturers need to consider.

  • Customers want the complete package. Right at launch, Apple had strong third-party app support, a media store, and backward-compatibility with phone apps. The competition showed up almost a year later and is just now picking up features like movie stores and zoom capabilities for phone apps. Nvidia is turning up the heat with regard to gaming with its TegraZone announcement. But productivity- and entertainment-oriented apps are still emerging slowly. Google still has catching up to do with Apple here.
  • Timing is everything. The tablet battlefield would likely be different if Apple's competitors released tablets at the same time as the first iPad. HP's webOS is a beautifully-crafted piece of work. Synergy is nothing short of genius. But ingenuity counts for less when you're making up ground. At this point, tablet manufactures are setting themselves up by comparing their first-generation devices to second-generation iPads.
  • Committing to the long-haul. The TouchPad didn't even last 60 days before HP pulled the plug. The company barely gave the TouchPad a chance to be recognized. Whether it would have succeeded is beside the point. In order to truly compete with Apple, tablet makers must be willing to invest money and time.


Bidding Adieu

It's too bad that we have to say goodbye to the TouchPad in this manner, because it's really a great hardware platform for webOS. Frankly, the TouchPad needed more time to mature, and a greater commitment on the part of HP to let the software and hardware coalesce.

Where do we go from here? Initially there were rumors that the TouchPad might be revived in the form of a Windows 8 tablet. However, CEO Meg Whitman seemed to put the kibosh on that idea in a recent conference call.

There are mixed emotions associated with the death of the TouchPad. Most of them are best summed up in the picture above. It's a sad day for consumers when another competitor bites the dust.

Discuss
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  • -4 Hide
    Goldengoose , November 1, 2011 1:19 PM
    Wish i'd got one now...
  • 7 Hide
    amk-aka-Phantom , November 1, 2011 1:24 PM
    Quote:
    There are mixed emotions associated with the death of the TouchPad. Most of them are best summed up in the picture above. It's a sad day for consumers when another competitor bites the dust.


    She doesn't look sad.

    Quote:
    Customers Tech illiterate sheeple want the complete package. Right at launch, Apple had strong third-party app support, a media store, and backward-compatibility with phone apps.


    Let's call things their proper names, shall we? ;)  The only "complete package" devices to date I've seen were Nokia Symbian phones. You didn't need ANY "apps" to fully utilise the hardware of the phone, it was all preinstalled and worked out of the box. THAT is a complete package; not a phone that burns a hole in your pocket and offers access to thousands of apps.

    Please, make Tom's articles sound like they're actually addressed towards a literate audience and not awed Apple fanboys who're shouting about their "complete packages" on every corner - I've heard that phrase (complete package/bundle/etc.) from every Apple fanboy and it has no meaning whatsoever.
  • 0 Hide
    bwohl , November 1, 2011 1:55 PM
    How could this article not mention the Kindle Fire? Low price point? Check. Appstore? Check. Surfing (via Silk)? Check. Android? Check.
  • 7 Hide
    zorky9 , November 1, 2011 1:58 PM
    that you Jane?
  • 0 Hide
    vaughn2k , November 1, 2011 2:03 PM
    Touchpad fire sale is only available in the US. not in our country... If it had, I'd buy 20 of these.
  • 7 Hide
    JMcEntegart , November 1, 2011 2:34 PM
    zorky9that you Jane?


    Yep!

    vaughn2kTouchpad fire sale is only available in the US. not in our country... If it had, I'd buy 20 of these.


    It was across the U.S., Canada, and a lot of Europe. Not sure about other countries, but it was definitely not just the U.S.
  • 0 Hide
    getreal , November 1, 2011 2:38 PM
    I love reading posts from amk-nerd-phantom; her posts remind me of how ignorant and clueless most IT nerds are.
  • -3 Hide
    amk-aka-Phantom , November 1, 2011 2:49 PM
    getrealI love reading posts from amk-nerd-phantom; her posts remind me of how ignorant and clueless most IT nerds are.


    Glad you're entertained; now please elaborate on my ignorance and cluelessness :lol:  And define "nerd". Most likely I don't fit under the definition at all.
  • -5 Hide
    Rob423 , November 1, 2011 3:02 PM
    iPad 3 ftw.
  • 2 Hide
    getreal , November 1, 2011 3:16 PM
    amk-aka-phantomGlad you're entertained; now please elaborate on my ignorance and cluelessness And define "nerd". Most likely I don't fit under the definition at all.


    In short - trolling anything and everything that says Apple or consoles and pretending the minority of the market (hardcore / enthusiast) is the majority. Nerd is referring to polarized standpoint and bias to said sector, and basically saying that everyone else is dumb.

    I don't necessarily disagree with you all of the time, it's just that I know if I read one of your comments, it is going to be 100% troll, so it is difficult to take seriously.
  • 2 Hide
    furylicious , November 1, 2011 3:27 PM
    Quote:
    Let's call things their proper names, shall we? ;)  The only "complete package" devices to date I've seen were Nokia Symbian phones. You didn't need ANY "apps" to fully utilise the hardware of the phone, it was all preinstalled and worked out of the box. THAT is a complete package; not a phone that burns a hole in your pocket and offers access to thousands of apps.

    Please, make Tom's articles sound like they're actually addressed towards a literate audience and not awed Apple fanboys who're shouting about their "complete packages" on every corner - I've heard that phrase (complete package/bundle/etc.) from every Apple fanboy and it has no meaning whatsoever.


    Please actually try to make an intelligent post before embarrassing yourself. I am hardly an apple fan, and what you said is just simply, downright incorrect.

    The fact is, Apple dominates the tablet market, enough so that most people that buy one don't feel like a hole is being burned in their pocket. The sales stats should provide adequate evidence for my assessment.

    Context doesn't seem to be your friend, I think what Jane was saying by "complete package" is a subjective, yet appropriate terminology to imply that Apple tablets have plenty of support out of the box including thousands upon thousands of apps, while Google is struggling to find developers. So, instead of trying to sound "technically correct", try to at least sound like you know what you are talking about, because most of the market disagrees with your less than obvious conjectures.
  • 1 Hide
    amk-aka-Phantom , November 1, 2011 3:47 PM
    getrealIn short - trolling anything and everything that says Apple or consoles and pretending the minority of the market (hardcore / enthusiast) is the majority. Nerd is referring to polarized standpoint and bias to said sector, and basically saying that everyone else is dumb.I don't necessarily disagree with you all of the time, it's just that I know if I read one of your comments, it is going to be 100% troll, so it is difficult to take seriously.


    Well, just so you know, I'm not trolling. I really DO think that PC gaming is superior to console gaming in every way and I really DO hate Apple (and any other company that offers an inferior product for a greater price and advertises software that can be installed on a device as a FEATURE - think Siri; and don't forget the patent trolling). If you think that's trolling, you're sadly mistaken. Besides, more than half of this website agrees with me.

    It's not even the consoles or Apple as such that piss me off; in fact, consoles are a perfect tool for cheap gaming in countries whose residents can't afford to spend a lot ($300 console, pirate all the games = ultra cheap gaming) and I applaud Apple for taking advantage of people's illiteracy, these iZombies deserve that.

    No, what pisses me off is that we are forced to hear this BS here at Tom's... not the correct website for it, since most people here are PC enthusiasts. I support kicking out all non-PC/software news to Tom's Guide and adding an option to disable them in the news feed.

    I never pretend that enthusiasts are the majority of the market. I only say that enthusiasts make the best choices. And it's not hard to find the best hardware for the price, and you learn a lot in the process. If you want to buy something, make sure you know what you're paying for. Don't have to read benchmarks and reviews for months in order to understand that MacBook Pro or Sony Vaio aren't the best value for money. I can understand that not everyone might want to know about the latest and greatest PC hardware. However, there's ALWAYS someone you can ask to help you find a good new PC/laptop instead of buying the most hyped one like most people do; and I won't even mention phones/tablets; comparing them is very easy. Just check which one has the most connectivity interfaces, then go into the shop and try it out. From my experience, taking some time to choose always pays off in the end.

    So take me seriously - whatever I say, I mean it.
  • -1 Hide
    amk-aka-Phantom , November 1, 2011 3:55 PM
    FuryliciousPlease actually try to make an intelligent post before embarrassing yourself. I am hardly an apple fan, and what you said is just simply, downright incorrect.The fact is, Apple dominates the tablet market, enough so that most people that buy one don't feel like a hole is being burned in their pocket. The sales stats should provide adequate evidence for my assessment.Context doesn't seem to be your friend, I think what Jane was saying by "complete package" is a subjective, yet appropriate terminology to imply that Apple tablets have plenty of support out of the box including thousands upon thousands of apps, while Google is struggling to find developers. So, instead of trying to sound "technically correct", try to at least sound like you know what you are talking about, because most of the market disagrees with your less than obvious conjectures.


    Reading fail for you. "Let's call the things their proper names" referred to the part of the article's quote which I corrected. As for "complete package", I understand what Jane meant, of course; but if you read my above post carefully, I've explained why I dismiss that particular definition of a "complete package". It's the same for MacBook owners who think they've got a great deal because of "complete package" - a laptop that came with the software installed, ZOMG! - but what they don't realise is that they were severely ripped off since that "software" isn't worth a single cent, because you can get it all for free. Open source, anyone? :) 

    Also, Android has thousands upon thousands of apps, as well. And the great thing about Symbian era was that the smartphones were evaluated by their hardware and not by the amount of website-emulating apps that you can download instead of visiting the website in your browser.
  • 0 Hide
    captaincharisma , November 1, 2011 4:05 PM
    with the way the kindl;e fire is gaining popularity i wonder if that device will be considered part of the google/android sales since amazon said it would be a customized version of android going on that tablet
  • 2 Hide
    furylicious , November 1, 2011 4:14 PM
    amk-aka-phantomReading fail for you. "Let's call the things their proper names" referred to the part of the article's quote which I corrected. As for "complete package", I understand what Jane meant, of course; but if you read my above post carefully, I've explained why I dismiss that particular definition of a "complete package". It's the same for MacBook owners who think they've got a great deal because of "complete package" - a laptop that came with the software installed, ZOMG! - but what they don't realise is that they were severely ripped off since that "software" isn't worth a single cent, because you can get it all for free. Open source, anyone? Also, Android has thousands upon thousands of apps, as well. And the great thing about Symbian era was that the smartphones were evaluated by their hardware and not by the amount of website-emulating apps that you can download instead of visiting the website in your browser.


    Don't you worry, I did read your post. If the term "complete package" makes you that upset, it makes me wonder what you think about any OS out there that doesn't have every bit of software available out of the box. It's simply not cost effective, so sorry if you haven't realized that yet. Hell, with the phone and tablet market, it comes with standard apps regardless, and a market where you can utilize your phone in a way that is efficient for your lifestyle, so that the hardware doesn't get cluttered with useless garbage that an average person might not need.

    Also, have you tried other alternative "open source" photoshop software? To me, they aren't as great, which is why people pay the extra bucks to get a software out of box that makes sense to THEM. Maybe you, being a tech savvy person, don't mind going through hours of learning curves using different types of available software, but the average thinking world doesn't care to go about, download software from sites that are unfamiliar to them, then skimming through online forums and websites to learn how to use it. Most people are simply familiar with photoshop and quite honestly, it's a good quality product, and because it is, people are fine spending those extra bucks.

    Also, since we are on the lines of talking about Apple computers, which I never cared to purchase one myself (just to let you know, once again, I hardly care for Apple), maybe you should look up some stats out there that show that Apple computers have good customer service and good hardware, which might explain why they are more expensive than your average computer? And of course the software, which I've explained. If Apple is such a terrible, money stealing company, then why do people seem to be happy with their products? Have you ever seen an unhappy Apple customer? I haven't. So obviously the company is doing something right, whether you disagree with their tactics or not. They are profitable company, sitting comfortably in the market. So..?

    I love Android, but if you had a bit of sense about you, you would know that developers go to Apple and not Android, because they go for where the money. So again, quality comes into the picture. So, you have yet again, failed to establish a good point regarding your Apple hating posts.

    Hell, I hate Apple, but even I can admit that they are doing many things right where many others are not.
  • 1 Hide
    furylicious , November 1, 2011 4:14 PM
    amk-aka-phantomReading fail for you. "Let's call the things their proper names" referred to the part of the article's quote which I corrected. As for "complete package", I understand what Jane meant, of course; but if you read my above post carefully, I've explained why I dismiss that particular definition of a "complete package". It's the same for MacBook owners who think they've got a great deal because of "complete package" - a laptop that came with the software installed, ZOMG! - but what they don't realise is that they were severely ripped off since that "software" isn't worth a single cent, because you can get it all for free. Open source, anyone? Also, Android has thousands upon thousands of apps, as well. And the great thing about Symbian era was that the smartphones were evaluated by their hardware and not by the amount of website-emulating apps that you can download instead of visiting the website in your browser.


    Don't you worry, I did read your post. If the term "complete package" makes you that upset, it makes me wonder what you think about any OS out there that doesn't have every bit of software available out of the box. It's simply not cost effective, so sorry if you haven't realized that yet. Hell, with the phone and tablet market, it comes with standard apps regardless, and a market where you can utilize your phone in a way that is efficient for your lifestyle, so that the hardware doesn't get cluttered with useless garbage that an average person might not need.

    Also, have you tried other alternative "open source" photoshop software? To me, they aren't as great, which is why people pay the extra bucks to get a software out of box that makes sense to THEM. Maybe you, being a tech savvy person, don't mind going through hours of learning curves using different types of available software, but the average thinking world doesn't care to go about, download software from sites that are unfamiliar to them, then skimming through online forums and websites to learn how to use it. Most people are simply familiar with photoshop and quite honestly, it's a good quality product, and because it is, people are fine spending those extra bucks.

    Also, since we are on the lines of talking about Apple computers, which I never cared to purchase one myself (just to let you know, once again, I hardly care for Apple), maybe you should look up some stats out there that show that Apple computers have good customer service and good hardware, which might explain why they are more expensive than your average computer? And of course the software, which I've explained. If Apple is such a terrible, money stealing company, then why do people seem to be happy with their products? Have you ever seen an unhappy Apple customer? I haven't. So obviously the company is doing something right, whether you disagree with their tactics or not. They are profitable company, sitting comfortably in the market. So..?

    I love Android, but if you had a bit of sense about you, you would know that developers go to Apple and not Android, because they go for where the money. So again, quality comes into the picture. So, you have yet again, failed to establish a good point regarding your Apple hating posts.

    Hell, I hate Apple, but even I can admit that they are doing many things right where many others are not.
  • 0 Hide
    acku , November 1, 2011 4:27 PM
    @Furylicious @amk-aka-phantom Let's call a spade a spade. Companies are not trying to just make a tablet for a tablet sake. They are purposely gunning for an iPad killer and want a large percentage of the market share. Asus' CEO commented on such for the Transformer. And they are right to do so. A company's future in tablets is going to depend on selling more than a few thousand units.

    @getreal Completely agree. Let's not pretend that tech news is limited to Bulldozer, Extreme Edition, etc... When we evaluate a product, we look at everything from top to bottom. That's why we review budget graphics cards and budget processors. Our Sandy review included the i3. That comprehensive approach should extend to everything. It's the right way to approach a product. Those looking for a more narrow view of the world don't need benchmarks to tell them what product to buy.

    Andrew Ku
    TomsHardware.com
  • 1 Hide
    furylicious , November 1, 2011 4:44 PM
    acku@Furylicious @amk-aka-phantom Let's call a spade a spade. Companies are not trying to just make a tablet for a tablet sake. They are purposely gunning for an iPad killer and want a large percentage of the market share. Asus' CEO commented on such for the Transformer. And they are right to do so. A company's future in tablets is going to depend on selling more than a few thousand units.


    I agree to some extent. As far as the market goes, you are completely correct. iPad is where its at, and there is no denying that. But, I think the approach of creating an "iPad killer" is not effective, not in the sense of creating copy cats.

    I can bring another example, Call of Duty. Call of Duty is the spade when it comes to FPS games, but the one thing that I hate more than CoD is when a competitor makes a game to "kill it" and it's exactly the same.

    Of course, looking at the transformer, and being able to play with it a bit, it does not feel like an iPad at all. I actually like it, and with the capability of converting (or transforming) to a laptop/netbook like computer, I think it brings a very different approach, one that I hope Asus continues to improve since it isn't completely perfect.
  • 1 Hide
    acku , November 1, 2011 4:50 PM
    FuryliciousI agree to some extent. As far as the market goes, you are completely correct. iPad is where its at, and there is no denying that. But, I think the approach of creating an "iPad killer" is not effective, not in the sense of creating copy cats.I can bring another example, Call of Duty. Call of Duty is the spade when it comes to FPS games, but the one thing that I hate more than CoD is when a competitor makes a game to "kill it" and it's exactly the same.Of course, looking at the transformer, and being able to play with it a bit, it does not feel like an iPad at all. I actually like it, and with the capability of converting (or transforming) to a laptop/netbook like computer, I think it brings a very different approach, one that I hope Asus continues to improve since it isn't completely perfect.


    Point taken. I think is good to have some discord. It's gonna to be unnatural for two people to agree on everything. But I definitely part ways with the sentiment that makes either of us immediately wrong.

    I especially dislike the idea of discounting consumers unwilling to spend 2000 for a system just to play games. There are plenty of wow gamers that care about performance. We cover everything when there's an ability to dig deep into tech.

    @Furylicious ---> The following isn't directed at you. It's for others. :) 

    If you don't care about benchmarks on tablets or a technical discussion on SoCs, then certainly head over to tomsguide. But here at tomshardware, we apply that approach to everything.
  • 1 Hide
    p05esto , November 1, 2011 6:47 PM
    I love my TouchPad, for email, web, movies, games and the apps I care about it is perfect. It's smooth, fast and I have no complaints at all. I'll b e using my touchpad for 5-10 years unless it breaks somehow. Even if the OS never gets another update and I stick with my current 60 apps I'm happy as a clam, email will be the same in 10yrs and so will basic web sites....the games on there will still be fun, my utilities will still work fine! Thank you HP!
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