Is the Motorola XOOM a flop?
The Motorola XOOM is actually doing well but it’s not even playing the same game as the Apple iPad.
There’s been a lot of chatter about the Motorola XOOM being a flop due to its poor sales figures but I believe it’s a modest success if you look at it with certain filters. The major problem is that it is not even close to being a competitor to the Apple iPad and playing for second place rarely works out well.
All the talk stems from a few analyst figures, as Deutsche Bank estimates the first Android 3.0 Honeycomb device has shipped 100,000 units and Pacific Crest said the sales of the XOOM and Motorola Atrix 4G sales were “disappointing.” This led to many headlines immediately saying this device was failure when you consider that the iPad 2 probably sold that many units in the first few hours it was available.
It’s safe to say that the Motorola XOOM is not a blockbuster hit and there are many reasons for that. There’s only been one 32 GB model with built-in 3G and the lowest price for the Honeycomb tablet was $600. That $600 comes with another long-term data plan from Verizon and getting the tablet without Verizon’s shackles means you’ll be shelling out at least $800 for Motorola’s tablet.
By comparison, the iPad 2 can be had for about $500 for the WiFi-only, 16 GB model. Apple hasn’t released exact data about which model of the iPad is the most popular but I would imagine the base model gets a lot of people in the door. As I've said before, no one really needs a tablet right now but that $500 price is just about low enough to be justified for some.
Is 100,000 units in a little more than a month a flop? Knowyourcell alumnus Zach Epstein argues it's definitely not a flop because this is a new market and those estimated sales figures suggest that Motorola has generated more than $75 million sales revenues in an unproven category. He says that we’ll need to keep on watching how sales progress once other Honeycomb devices like the T-Mobile G-Slate and new Samsung Galaxy Tabs land to fully judge it.
I agree that it’s a success if you take the iPad out of the equation and just look at the XOOM sales in a vacuum but I also believe that’s a foolish proposition. Apple created the demand for the tablet market, is the major player in the field and it will continue to be the gold standard until something takes it down.
The XOOM is not a flop but I sure hope Motorola thinks it is compared to the iPad.
The absolute worst thing Motorola could do is try to play for second in the tablet market because this is a dangerous strategy that doesn’t lead to anything good. This is the only Android Honeycomb tablet on the market today but that will change over the next few months with products from Samsung, LG, Acer, HTC and others.
Heck, rumors suggest LG will produce a Nexus tablet that shows exactly what Google wants from Android in a tablet. Motorola will be facing challenges on all fronts, as the BlackBerry PlayBook is coming out soon, the HP TouchPad will land in a few months and every company worth a darn will have a table solution on the market by the end of the year.
That’s why I want Motorola to view the early sales of the XOOM a flop and figure out how it can address those issues with software updates and also for the next version. Does Motorola have the marketing muscle, software and hardware chops as Apple? Probably not but it will never come close if it is content with the modest success of the XOOM.
Back when Palm reinvented itself on the back of webOS and the original Pre, then-CEO Jon Rubinstein would talk about how the company didn’t need to be the market leader, as it could succeed off the fat middle of the rapidly-growing smartphone market. That modest success strategy led to Palm having to be having to be acquired by HP.