It is one thing to unload discontinued TouchPads at $200 below per unit cost; why the heck would HP decide to make some more?
Here are some possible explanations:
1. An attempt to get rid of components that HP has, or is committed to. This is likely to have some merit, even if it is not necessarily the primary driver. The TouchPad was discontinued so fast (less than two months) that HP’s commitments might well have run longer.
2. An opportunistic move to shore up the value of the WebOS asset. HP’s rapid shut down of the TouchPad did little for WebOS’s resale value. Investing in creating an installed base of a few million users might attract a buyer for WebOS, for which HP paid $1.2 billion. There have been rumors that Samsung is exploring a deal.
3. A stealth move to relaunch the TouchPad. Could continued market frenzy (albeit at fire sale prices) give HP management an excuse to reconsider the shuttering of the WebOS device business? After all, the TouchPad would probably command the number two position in the tablet market, after the Apple iPad.
4. Incompetence. A dysfunctional board of directors? A CEO who doesn’t understand the consumer business? A mediocre team?
(Update -- 9-5-2011: See my more recent post: "Is the HP TouchPad Poised for a Coca-Cola Classic Moment?" It expands on the question of how HP got to this point, and what it might do next.)
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What’s your guess? Please share your comments below.
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