HP Q3 Conference Call: TouchPad Is “Not Gaining Traction” [Duh!]

HP Q3 Conference Call: TouchPad Is “Not Gaining Traction” [Duh!]

Reports about Best Buy and Walmart returning huge numbers of unsold TouchPad tablets to Hewlett Packard appear to be strikingly true.

Speaking on a conference call right after dropping the bombshell that HP is killing its webOS phones and tablets, HP CEO Leo Apotheker admitted that his company’s iPad competitor is not selling at all, despite hefty price cuts.

The company hoped the TouchPad would quickly establish itself as the number two to the iPad, Apotheker said, but it hasn’t made a dent at all.

“There is a clear movement on the consumer PC space… the tablet effect is real,” he said on an earnings call to Wall Street analysts. “The TouchPad is not gaining enough traction in the marketplace.”

As a result, HP is concentrating on enterprise, while splitting webOS and PC operations, he said.

“Our PC business needs the flexibility to make its own decisions,” Apotheker said.

He expects a spinoff of the PC business will take 12-18 months. In the meantime, it makes no sense to continue selling webOS devices.

“We have been tracking webOS… we were successful at launching the software, but we are exploring options to leverage the software in the future. However, our devices were not successful,” he said.

“About a year ago, we made a bet on webOS. At that time we set clear metrics and milestones to measure success. The sellthough of the TouchPad was not what we expected. Our expectation was to establish TouchPad as the clear number 2 platform in tablets.”

He continued: “It was clear that pricing parity would not generate demand, and we cut prices by $100.”

So HP is cutting its losses, Apotheker said.

“WebOS would require significant investments over the next five years, generating risk without clear rewards.”

A transcript of Apotheker’s comments is here on the This Is My Next liveblog.

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  • TylerHoj

    That sucks, I was looking forward to another generation of this device. I love my iPad 2 and was considering still buying the touchpad as well. I would have much rather have seen the playbook bite the dust. So, is HP continuing selling the device until stock clears out or what? 

  • GDal

    Where were all these WebOS fans? I thought they were all singing the praises of WebOS!

    Well, it looks like the market, with people who actually BUY products, wasn’t so impressed.

  • KeiFeR123

    HP device hardware specs are nice but the OS sucks.  I wish someone can hack it so you can either put iOS or Android in that little thing…

  • ShaunaJames

    guys I just paíd $20.87 for an íPad 2.64GB and my boyfriend loves his Panasoníc Lumíx GF 1 Camera that we got for $38.76 there arriving tomorrow by UP S.I will never pay such expensive retail príces in stores again. Especially when I also sold a 40 inch LCD T V to my boss for $657 which only cost me $62.81 to buy.
    Here is the website we use to get it all from, bit.ly/BidShop

  • lals83
  • techgeek01

    :/?  I would almost have to say that the OS is the best thing about this and the hardware is what needs to be a bit better….

  • cliqsquad

    I second that, I would have no problem with Apple buying webOS at a bargain and using it with some tweaks or taking the best parts of it to bring to iOS. I am hoping something sticks and gives Android some competition. The iPhone on 3 carriers will do some damage but without a third OS on desirable hardware Android is becoming the Windows of the Mobile world. I am sorry I like OS options. 

  • cliqsquad

    Why have anything bite the dust? Android is only getting stronger the mobile market and it is on track to become the Windows of the mobile world. We need more OS options to fight this path. I love Apple, my iPhone and hope they bring iPhone to more carriers to give Android a fight. However, a third OS on desirable hardware is going to be what does it. More choice in OS’s not less please

  • AshleeNicole09042

    I just p a i d $21.87 for an i P a d 2-64GB and my boyfriend loves his Panasonîc Lumîx GF 1 Camera that we got for $38.76 there arriving tomorrow by UPS.I will never pay such expensive retail prices in stores again. Especially when I also sold a 40 inch LED TV to my boss for $657 which only cost me $62.81 to buy.
    Here is the website we use to get it all from,http://to.ly/aXHh

  • techgeek01

    …….. I absolutely do not want apple at all (or about any other software manufacture) to buy it.  I love the OS as it is.  What really needs to happen is someone needs to but the time and effort into the hardware portion of the phone. (I don’t know why HP couldn’t do that)  If someone can put the time and effort into the hardware portion of the phone, the phone will be SOO much more better than how it is now. (or the tablet)

    well, don’t rule out Windows quite yet. There probably be at least 3 major OS players…. 

  • lals83
  • cliqsquad

    I agree with you the OS is great, my friend had the original Sprint Pre. The hardware ruined the experience, everyone wanted iPhone like designed devices and HP kept the stupid Pre design. 

    The reason HP killed the production of devices is because they didn’t figure out the cost before buying Palm, I read it over on live Blog on Pre Central. After they released the devices and failed to gain traction they saw they would loose even more the longer they kept the device unit open. They wanted to cut cost, especially since the PC market is loosing sales to tablets, well the iPad. 

    I always said if I could Jam web OS into my iPhone 4 body, I would be a very happy man for a long time.

  • techgeek01

    I personally, liked the designed.  That being said, I didn’t mind the plastic, but using metal would have 1) made it more durable 2) better build quality and 3) look better.

    Keep the keyboard and made a larger one.

    the other day, I was thinking they should have had a 3.5 inch, touch screen (entry level model) a higher end 4.0 inch, touch screen model with keyboard and then a 4.5 inch, high end model.

    but the hardware, the hardware, it just seemed anemic compared to the iPhone, and especially the android phones that were coming out.

    great OS, great OS, but they (HP) should have just put the time, effort and money to make a solid and great product, that didn’t cut corners. 

  • GDal

    You say you love WebOS… When have you put it to actual use? Do you own/use a Palm Pre phone?

  • AnupR

    I really like the webos user interface. Loved the cards style. Really, maybe Apple should buy the webOS patents asap and use it to enhance iOS to make card style multi-tasking. I am positive it is thousand times better than android anyday. Its problem ? too late in the game + not many apps and not much commitments. If iPad 3 comes out, my guess is it won’t do as well as iPad2…why? because people are not yet digested iPad2. The iOS needs to be focused to get better and the best before releasing iPad 3 otherwise it will be the first setback to apple if they release it too soon. Again, thats my take… open to be disagreed.

  • lals83
  • lsla5577
  • lsla44
  • lsla44
  • cliqsquad

    The old CEO who was in charge of the Palm purchase would have. The new guy is a bozo killing off all of HP’s hardware divisions. He wants to turn HP into the new IBM

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About the author

Leander KahneyLeander Kahney is the editor and publisher of Cult of Mac. He is the NYT bestselling author of Jony Ive: The Genius Behind Apple's Greatest Products; Inside Steve’s Brain; Cult of Mac; and Cult of iPod. Leander has written for Wired, MacWeek, Scientific American, and The Guardian in London. Follow Leander on Twitter @lkahney and Facebook.

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