HP Cuts $100 from TouchPad, iPad Rival

Dennis Faas's picture

This week, Walmart announced it would bow out of the digital music business, presumably because competition from Apple's iTunes proved too fierce.

Now, it appears Apple's dominance of another market is forcing hardware firm Hewlett-Packard (HP) to take drastic action. HP has announced it will cut $100 from the price of its tablet PC, the TouchPad.

The cost of the 16GB TouchPad tablet has dropped from $500 to $400, while the 32GB edition goes from $600 to $500. That means both choices are available for roughly $100 less than comparable iPads from Apple. (Source: wsj.com)

Apple iPad Market Already Overcrowded

This isn't the first strategy HP has used to try to lure consumers away from Apple's ubiquitous tablet.

When it began shipping the TouchPad in July, the company offered a $50 rebate to early buyers. It then tried bundling software by offering 50GB of free cloud storage through Box.net, a deal with a value estimated to be about $240.

Experts see all those moves as evidence that HP just isn't succeeding in challenging Apple in this already crowded market.

"Consumers aren't buying the TouchPad at the iPad price point, so HP is hoping a lower price will make its tablet look more attractive," said Sarah Rotman, an analyst for Forrester research.

Lower Price Point Could Undermine Brand

The worst part about drastically slashing a price tag is that consumers start to question the product's future.

"Cutting prices may cause consumers to buy the TouchPad out of curiosity, but it undermines HP's efforts to market a premium iPad competitor," Rotman said. (Source: wired.com)

A recent report captures just how crowded this market is becoming. Experts at DigiTimes predicted that Apple products will account for about 61 per cent of the entire tablet market this year, with the remaining 39 per cent being divided between a variety of different Android products, Research in Motion's troubled PlayBook, and HP's TouchPad.

Rate this article: 
No votes yet