Talking tech since 2003

As worthless as I felt the discontinued HP TouchPad was when it went on sale last month following HP’s announcement that they planned to step out of the hardware game, I must admit that there was a brief moment where I honestly considered whipping out my Visa card and ordering one for myself.  After all, at $99 the TouchPad did seem like an excellent deal, giving users to hardware of almost the same stature as the iPad 2.  But the more and more that I thought about it, the $99/$149 price points on the TouchPad really weren’t as good as they seemed when one accounted for the fact that the software that it ran was not only being phased out, but also was extremely unlikely to attract the attention of developers down the road.

What did  learn from the whole TouchPad hype though?  Price sells.  People will buy anything if they think they’re getting a good deal on it.  Working in retail you would think that this reality would have struck me a long time ago – after all, I see instances where people sacrifice quality for price every day in my line of work – but in all honesty the TouchPad sale prices have been the best example of price-focused sales in recent time.  Sure, people are going to tell you how wonderful of a device the TouchPad is; how feature-rich it is, how wonderful WebOS is, how light and slim the device itself is, etc.  But even as true as all of this may be, the fact of the matter is that a great many of the people who have TouchPad’s in their hands right now simply would never have bought the device if it wasn’t for the price.

And that’s why this week’s announcement that Lenovo is going to bring 7-inch Android tablets to the mobile market – all at cut-throat prices – is so brilliant to me.  You see, this fall the world-renowned electronics company is going to start shipping out Android tablets.  But while I’d typically be weary of the Android-powered tablet industry altogether (I’ve written before that I personally feel the industry as a whole has a very dim future) Lenovo’s strategy here gives me a boost of faith that the company will be able to do fairly well.  Why?  Instead of trying to sell Android tablets at the same or slightly lower price points than the Apple iPad family like so many other manufacturers have done in the past, Lenovo is making their product stand out simply by offering it at prices only rivaled by the discontinued TouchPad.

Consumers in the European Union will be able to pick up the 8gb model of Lenovo’s 7-inch Android-powered tablet for a mere $199, while users around the world will be able to get their hands on 16 and 32gb editions of the tablet (dubbed the “A1”) for $249 and $299, respectively.  At about half the price of the iPad 2 and other Android tablets, the A1 is sure to become a hot product with consumers simply because of its price point.  At very least the low price of the product will at least get potential buyers to look at Lenovo’s tablet; something that I honestly don’t think can be said about many of the disappointing tablets on the market now.

Now, in all fairness I must say that I was pretty impressed with HP when they dropped the prices of their TouchPad tablets by $100 earlier last month (before the $99 sell-off) because I felt that the company had finally realized that they weren’t going to get away with iPad-level pricing for what most consumers viewed as an inferior product.  But looking back at it, I must say that HP’s move really looks as if it was a last-ditched effort to attract attention to their failing product before dropping the price down to a mere fifth of its original amount.

But Lenovo’s move goes above and beyond what HP has done.  From the get-go it is obvious that Lenovo has focused on price point with their product and has shaped it so that the low price tags are not only attractive to consumers but profitable to the company as well.  Unlike HP who had to make their pricing changes after-hand – ultimately consuming through what in reality was pure profit – Lenovo is introducing its product to the world with competitive pricing.  Sure, the company probably had to cut a few corners (read “use lower-grade components”) to make this a reality, but the fact of the matter is that they’ve managed to do it, and I for one think it will pay off.

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