posted by Thom Holwerda on Mon 22nd Aug 2011 21:19 UTC
IconLast week, HP killed its webOS devices unit. Over the weekend, the company slashed the prices on the TouchPad. The result? The TouchPad sold out completely in a matter of hours. This confirms what I've been hearing from friends and family: "I'd love a tablet, but I'm not paying laptop money for one."

So, HP pretty much killed its webOS business last week, while the company is also seeking to get rid of its PC business. The additional purchase of Autonomy illustrates that the company wants to get ouf the consumer business, and focus on the enterprise, big-iron market instead. You know, the route IBM took years ago.

To get rid of existing TouchPad stock, the company slashed its price to a mere $99, which is an absolute steal. Suddenly, people are lining up to buy a defunct device with little to no future. There are actual lines at Best Buy for the $99 TouchPad, but Best Buy has already sold out. HP.com, too, doesn't have any on offer.

This confirms a general sentiment I've been hearing around me. Friends and family are all very interested in tablets for use on the couch, but almost everyone I talk to simply finds them too expensive. The iPad 2 and similar tablets like the Galaxy Tab 10.1 all cost round and about $500/€500, which, for most people, is laptop territory, or at least near-laptop territory. That's a huge amount of money for a device which is decidedly less useful and functional than a laptop, and is, in essence, nothing more than a web browser and email client with a large screen.

When it comes to smartphones, which sit in the same price category, things are different, since they are generally "free" on contract, meaning they are perceived differently. Tablets, however, are bought outright, for their full price, and at $500/€500, it's not "a laptop and a tablet", but "a laptop or a tablet". This sentiment is a hugely limiting factor for tablet sales to truly take off in the way smartphones and laptops have.

Lower the price, and lots of more people are suddenly willing to spend money on a tablet. This price drop has demonstrated that there is a huge market for cheap tablets, and this market is currently not being served at all. The TouchPad's $99 price is a sign of things to come for the tablet market.

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