HP TouchPad #2 Tablet Behind iPad, Says NPD Report

By Cheryl Lindo Jones
23 Nov, 2011 5:08 am

HP had a ridiculous goal to be “number one plus” in the tablet space. Well, it was ridiculously described, but had they really put their weight behind webOS and the HP TouchPad, they might’ve gotten really close to the iPad in popularity.

Strangely, thanks to their $99 and $149 firesale of the Touchpad, HP actually reached the #2 spot behind the iPad, officially outselling Samsung’s Galaxy Tab line, but only just.

According to the numbers, HP sold approximately 204,000 tablets, while Samsung sold 192,000 tablets. However, it’s not clear which Samsung tablets fall under this number, whether it’s all Galaxy Tab 10.1s, or a combination of all of Samsung’s tablets. Asus, another strong manufacturer in the tablet space, managed only 10% of the market share this year. Hopefully the Asus Transformer Prime gives them a sales boost for next year.

Obviously, if any of these manufacturers had dropped their tablet prices to $99, they likely would have enjoyed a similar huge boost in sales. This does point out that price is very important for tablet sales. The rise of $199, 7-inch tablet offerings from several manufacturers backs this up.

Amazon has the right idea, selling the Kindle Fire at a bit of a loss to grow their market share. But the difference for Amazon is that the hardware is not their actual product; their services — the Kindle store, MP3 store, Appstore for Android, and of course their physical goods store — are the real money-makers for Amazon. The Kindle Fire is just a conduit for people to more efficiently buy goods from Amazon. So they can afford to lose money on tablets if it means making it up in Amazon Prime memberships or purchases/rentals from their other services. Asus, Samsung, and all the other Android tablet manufacturers have to make money on their tablets in order to succeed. There is no loss-leader business model suitable for them, unfortunately.

So while HP’s last-ditch effort to squeeze profits from the HP TouchPad inadvertently netted them the #2 spot behind the iPad in tablet sales, it’s unlikely that any other tablet manufacturer besides Amazon can do the same thing and survive the profit losses, unless they can properly prepare a long-term plan to make up for such losses.

Via Ars Technica, Source: NPD Group