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I don't understand where you're getting the $23mm/quarter number. The last quarterly numbers I saw for Apple were just under 10 million iPads sold; using the $

I don't understand where you're getting the $23mm/quarter number. The last quarterly numbers I saw for Apple were just under 10 million iPads sold; using the $200/tablet and $15 profit numbers I gave before, that'd be $150mm profit on $2Bn revenue. Those aren't "blow your socks off" numbers, but they're not "disaster" numbers either (whereas what actually happened with the TouchPad was a disaster.) Numbers like that are at least viable for a major strategic initiative for a company like HP, provided there's sufficient motivation for such an initiative. With the market leader making $200/unit and you making $15/unit, they could put you out of business if they're at a comparable price point. But if the competition's $600 iPad cuts its price to $550 or even $500, it's not going to pull a lot of customers away from your $200 hPad; you're serving very different segments of the market. Similarly, a 10% price cut by Maserati wouldn't threaten Cooper Mini sales. I'm not saying HP necessarily made the wrong move here. I'm just saying, I don't think you have to be a "big dummy" to think there's room for a low cost, low margin tablet that makes some profit from software.

tptacek 15y ago
You're forgetting that those 10 million iPads were sold over many quarters. Re-do your math. There is absolutely room for a low-margin low-cost tablet. The Kindle is one of them. But there isn't room for the HP Touchpad at HP. I kind of doubt there's room for the HP Touchpad anywhere, because it's intrinsically positioned against a superior product sold by an extremely competent company.
- lotharbot 15y ago
  > "You're forgetting that those 10 million iPads were sold over many quarters." "Apple sold 9.25 million iPads during the quarter" -- http://www.apple.com/pr/library/2011/07/19Apple-Reports-Third-Quarter-Results.html http://www.apple.com/pr/library/2011/07/19Apple-Reports-Thir... My math is fine. > "there isn't room for the HP Touchpad at HP" There, I agree. The HP TouchPad is trying to be direct competition for the iPad, and that's why it was a total disaster. If instead HP made the WeakerPad, with higher capability than the kindle but lower than the iPad, and targeted the $200 price point (where their main competition is a bunch of 7" Android 1.5 tablets with resistive touchscreens), they might find a sweet spot in the market.

tptacek 15y ago

You're forgetting that those 10 million iPads were sold over many quarters. Re-do your math. There is absolutely room for a low-margin low-cost tablet. The Kindle is one of them. But there isn't room for the HP Touchpad at HP. I kind of doubt there's room for the HP Touchpad anywhere, because it's intrinsically positioned against a superior product sold by an extremely competent company.

lotharbot 15y ago
> "You're forgetting that those 10 million iPads were sold over many quarters." "Apple sold 9.25 million iPads during the quarter" -- http://www.apple.com/pr/library/2011/07/19Apple-Reports-Third-Quarter-Results.html http://www.apple.com/pr/library/2011/07/19Apple-Reports-Thir... My math is fine. > "there isn't room for the HP Touchpad at HP" There, I agree. The HP TouchPad is trying to be direct competition for the iPad, and that's why it was a total disaster. If instead HP made the WeakerPad, with higher capability than the kindle but lower than the iPad, and targeted the $200 price point (where their main competition is a bunch of 7" Android 1.5 tablets with resistive touchscreens), they might find a sweet spot in the market.