It's only a matter of time before Motorola and Verizon Wireless drive down the cost of the Xoom Honeycomb tablet, thanks to Apple's aggressive iPad 2 pricing.
Apple's iPad 2 has a few
features in common with Motorola's
Android 3.0 "Honeycomb" tablet, including a dual-core
processor and dual cameras.
Of course, the iPad
is also slimmer and weighs less than the Xoom
but these may be mere trifles for consumers next to the price difference. Apple
retained the same pricing scheme for its second-generation tablet as did for its
Accordingly, if Motorola and
Verizon Wireless execs have any cause for concern, it's in the pricing, which
threatens to undercut their Xoom sales. Verizon is offering
the Xoom for $599 with a two-year deal, or $799 without a contract.
The $799 price tag is $70
more than a comparable 32GB iPad with WiFi+3G. Here's the kicker though:
Motorola and Verizon executives could rightfully argue that the price
difference was more than worth it over the first iPad because the Xoom boasted
dual cameras and a dual-core processor, and is upgradeable to Verizon's 4G LTE
(Long-Term Evolution) network.
The iPad 2 neutralized
nearly every premium Xoom feature but the 4G network capability-which, while
free, will be a hassle to upgrade to this spring.
So what are Motorola and
Verizon to do? Naturally, they could slash the Xoom price point to make it more
enticing for consumers. When asked whether Verizon would slash the Xoom cost, a
Verizon spokesperson told eWEEK: "We don't discuss pricing or pricing
Fair enough. eWEEK is
guessing the Xoom could drop to $499 on contract and $699 without. Analysts
unilaterally agree the partners in Android will have to cut the costs.
"Will the Xoom come
down in price eventually? Sure. But I wouldn't think it would drop as an
immediate competitive response to the iPad 2, because the iPad 2 is priced
identically to the original iPad," Current Analysis analyst Avi Greengart told
eWEEK. "It's not like Motorola didn't know it was coming."
Industry analyst Jack Gold,
who was underwhelmed by the iPad 2, told eWEEK the Xoom price will come down once
the companies scale up production and the "early adopters" are taken
care of. "And you'll also see lower-cost versions of the Xoom out
soon-perhaps by CTIA [scheduled for the last week of March]."