HP TouchPad, Nintendo 3DS show the power of the price cut

HP TouchPad, Nintendo 3DS show the power of the price cut

Summary: By cutting the prices of the 3DS and TouchPad, both Nintendo and HP have shown the effectiveness of the price drop.

SHARE:
TOPICS: Hewlett-Packard
13

If you are like most people in America today, then you are probably broke. But like most other people, you also harbor an unrelenting lust for the latest technology. How do you reconcile these two clearly conflicting states? By waiting for a price cut, apparently.

Two recent examples show that sometimes all it takes to revive a lagging gadget is to cut its price. Last month, of course, there was the TouchPad, which went from $500 non-desirable to the most sought-after gadget of the summer. The impetus? HP announced that it was killing the device, and, in a attempt to rid itself of the things, said that it was cutting the TouchPad's price to $99. Suddenly, the tablet that no one wanted became the very thing that everyone desired. The perfect impulse buy, the $99 TouchPad was such a bargain that people lined up overnight in order to purchase it. The earth had turned on its own head.

And then there is the Nintendo 3DS. Dogged by poor sales and lukewarm consumer interest, the 3DS has had a pretty sad run in the months following its release. In August, realizing the console's dire situation, Nintendo cut the price of the 3DS from $250 to $170 in the hopes that the price drop would spark a surge in sales.

And that's exactly what happened. The company announced on Thursday that it had sold 185,000 3DS units in the nineteen days following the price cut, a 260 percent increase over a similar period in July.  Japanese retailers also posted similar sales increases, with sales of the 3DS nearing 200,000 during the first week after the price drop. Is the 3DS's outlook starting to brighten? It sure seems that way.

Both examples show that the largest factors in the renewed interest in both devices weren't the devices themselves, but their suggested retail prices. If money talks, then the price drop is the loudest bellow of all. Other companies should take note.

Topic: Hewlett-Packard

Kick off your day with ZDNet's daily email newsletter. It's the freshest tech news and opinion, served hot. Get it.

Talkback

13 comments
Log in or register to join the discussion
  • Apple can sell the iPad for $1

    If they want to lose money on every transaction. Don't you realize the HP ran a 'firesale'? That's when you lose your shirt to dump inventory of a product no one will buy, that you don't intend to support. HP lost a fortune on this.

    What makes you think other manufacturers are going to take note? It is estimated that building a tablet, just the parts alone, can come to about $300. Now figure in all the overhead. Apple has a lock on the worlds supplies of ram, displays, etc. No one is going to be able to undercut their prices for the same quality product.

    Other manufacturers now have to use shoddier materials just to meet Apple's price point. A brilliant move by Apple to see where the puck was going and investing in the parts that would be needed to score the big goal.
    ShazAmerica
    • RE: HP TouchPad, Nintendo 3DS show the power of the price cut

      @ShazAmerica i think he wrongly asumes it is the price cut itself that attracks the consumer, wheras IMO it is actually and only the price, if say acer could make an almost ipad and sell it for 200 for profit, then they would, and would sell a lot in the process but that isn't the nature of these things ATM
      beenman500
      • RE: HP TouchPad, Nintendo 3DS show the power of the price cut

        @beenman500
        There is also the assumption that many HP TouchPad purchasers wanted it as their primary device, something which I doubt. I wonder how many people, like me, bought one just for the sake of curiosity? The HP TP is nice, but it will never be my primary tablet device.
        Wakemewhentrollsgone
      • RE: HP TouchPad, Nintendo 3DS show the power of the price cut

        @ptorning

        Not so much as people wanting an Android port on it. Gingerbread is in the works. Dual-Boot; WebOS for the UI, GB for apps
        Fat Albert 1
    • RE: HP TouchPad, Nintendo 3DS show the power of the price cut

      @ShazAmerica <br><br>I have nothing against iPad, in fact, I love it too but it should be mentioned that the hardwares in the HP Touchpad are not inferior to the Apple iPad. It is the software that fails to exploit it. It is just a matter of who does it better and smarter and this is how America survives in bad times and thrives in good times, does it better and yes we can. I do own several Apple's products but $600 at this time is more like $6000 a few year back, I just cannot afford it. If HP can sell it for $300 and make $1 profit, it should keep the product. The reward will come after. Nothing comes easy any more.

      And of course, as always, money talks.
      simbatran
      • RE: HP TouchPad, Nintendo 3DS show the power of the price cut

        @simbatran

        It is almost a certainty that the hardware is inferior. The devices plastic, yet it is heavier. The battery doesn't last as long. It got warm.

        Look, the Pre had even worse hardware and it was slow. Moving WebOS to the Touchpad, a device with a 1ghz processor and a gig of ram and it still ran poorly. The software had issues too.

        You say if they can make a profit, they should keep it. Are you kidding? They paid $1.2b for Palm. they spent who knows how much modifying the webOS for tablets, for marketing, for production.

        The app store makes money to run. It takes money to patch bugs and enhance the system. How will all of this happen if all HP is making is one dollar per unit?
        dhmccoy
  • &quot;Other companies should take note.&quot;

    Take note of what? How to lose a ton of money? That's exactly what HP just did. Of course it's sought after, they are practically giving them away. Worst case scenario you could turn an easy $100 or more reselling the thing on Ebay. "Jeepers, Toyota could corner the car market by selling new Corollas at $4000 a pop". That's kind of the level of analysis I am seeing here. Of course Toyota would be bankrupt a few hours later but man what a ride.

    At least Nintendo has some hope of making it back on game sales.
    oncall
  • RE: HP TouchPad, Nintendo 3DS show the power of the price cut

    Take note of the fact that their asking prices are too high. Apple is Apple and always has been. Compare the price of a MAC to a PC with similar performance. Steve Jobs himself even knew that the asking price for his product was more in the game than the substance.

    It seems all these new pads want to price themselves in apple territory without the history to back them up.

    Maybe this is what they should take note of.
    Brammy63
    • RE: HP TouchPad, Nintendo 3DS show the power of the price cut

      <ul><i>Apple is Apple and always has been. Compare the price of a MAC to a PC with similar performance. </i></ul><p>This has unfortunately become the least intelligent comment on the block. It tries to map the past onto a present that refuses to cooperate.

      There is no evidence whatsoever that Apple is leaving room for competitors to underprice it in the tablet market. Huge, sophisticated OEMs like Samsung and HP have tried to build comparable products. What they've found is that when they're done, their choices are to set the same price Apple has, or lose money. This empirical result, which we have seen now from several vendors, ought to drive a stake in the heart of the "it's still the 1980's --- you watch, somebody will build an iPad for $200" fantasy.
      Robert Hahn
      • RE: HP TouchPad, Nintendo 3DS show the power of the price cut

        @Robert Hahn
        Indeed. Even on PCs. You can spend $600 and get a PC with a particular CPU. Now, wrap that CPU in a motherboard designed to save $4. Use the slowest, cheapest HD you can find. Put that next to a loud fan and cheap optical drive. House that in a cheap, plastic laptop case.

        Is it cheaper? Sure. Is it heavier, hotter, louder, flimsier with lesser battery life? Yep. And just for laughs, have something go wrong and need support.
        dhmccoy
    • Some Tablet history for you:)

      @Brammy63 ... Before the iPad there wad roughly ten years of lackluster tablet sales. These tablets cost from 1,500.00 to around 1,200.00 on average. After that decade long period came the iPad with it's supporting cast of an actual ecosystem. Sales took off! Now the iPad and APPLE was the primary force bringing the price of the average tablet to the consumer NOT the usual subjects. What I find amusing is the mass of people's who seem to have forgotten the tablet market and the costs if tablets ore iPad. Then to add insult to injury they still bleat about how Apple's tablet is too expensive and use a product sold at a fire sale because it was discontinued! Seriously!!!<br><br>Pagan jim
      anonymous
  • RE: HP TouchPad, Nintendo 3DS show the power of the price cut

    Funny how people read into comments things that were never said. The history I speak of is Apple's history as a niche market. The costs of the tablet build out was arrived at by someone pricing out each individual component. I have yet to hear a credible source quote their own manufacturing costs.
    Brammy63
    • RE: HP TouchPad, Nintendo 3DS show the power of the price cut

      You're not going to hear that. What company would reveal their manufacturing cost to their competitors? In fact, how could they... they will have signed non-disclosure agreements with virtually all their component suppliers.

      Apple's history as a niche market is just that: history. It is not something they set out to do, nor is it an ordained outcome of everything they do. It happened because at the time the Mac and the PC started, IBM virtually dictated who would buy what from sea to shining sea. They owned corporate IT. And when small businesses went out to buy their first computers, IBM was the only computer company they'd ever heard of (this actually came as quite a surprise to some of the other leading computer companies of the day, like Digital and Hewlett-Packard).

      That circumstance will not be repeated. Microsoft imagines that it had something to do with the success of the PC compared to the Mac. It was just along for the ride. Without IBM, they may as well have been the supplier of operating systems to MITS Altair.
      Robert Hahn