Motorola Xoom: 10 Reasons It's Failing and How It Can Be Rescued

By Don Reisinger  |  Posted 2011-04-07

Motorola Xoom: 10 Reasons It's Failing and How It Can Be Rescued

The Motorola Xoom has been on store shelves for over a month. In that time, the tablet has not sold nearly as well as the company would have liked. In fact, an analyst at Deutsche Bank believes Motorola has sold just 100,000 Xoom units since the device's launch. That puts it well behind Apple's iPad, which saw 15 million unit sales last year, as well as the iPad 2, which is still unavailable across the United States.

So what went wrong with the Xoom? On paper, the device looks to be an outstanding option. It comes with a 10.1-inch display, both a front- and rear-facing camera, and it runs Google's latest operating system, Android 3.0 "Honeycomb." But it failed to catch on with customers. Now Motorola is forced to determine what its next step should be.

Luckily for Motorola, there are several ways it can go about fixing the Motorola Xoom, and although they might not be the easiest decisions to make, they are undoubtedly necessary. Here are the reasons why Xoom is failing and what can be done about it.

1. Put pressure on Google to fix Honeycomb

When Google first showed off Android 3.0 Honeycomb, the excitement surrounding the platform was palpable. Just about everyone thought that the OS, which combines elements of desktop-based software and mobile software, would best iOS. But it didn't happen, and now the Xoom is suffering because of it. The time has come for Motorola to apply some pressure on Google and get it to start working out many of the platform's kinks. As critics have said, Honeycomb just wasn't ready for prime time when it hit store shelves.

2. Where's the differentiation?

One of the biggest issues facing the Xoom is that it's not unique in any way. The device comes with a dual-core processor; so does the iPad 2. The Xoom features dual cameras; so does the iPad 2. It has a 10.1-inch display; so does both Samsung's and Dell's upcoming tablets. The Xoom is just another tablet on store shelves that customers ignore because it isn't unique. Motorola must admit that and find ways to differentiate the product. Getting 4G up and running on the Xoom might be the best first step.

3. The price is wrong

Motorola was quick to point out that the Xoom comes in at $800-$29 cheaper than Apple's most expensive iPad 2 option. Even better, Motorola said, is that with a two-year contract consumers can get the device for $600. All the while, it failed to acknowledge that five out of the six iPad 2 options are cheaper than the contract-less Xoom. And the most apt comparison-Apple's 32GB iPad 2 with 3G-is $70 cheaper than the Xoom without a two-year contract. Motorola needs to drop the price of the Xoom right now. It has no other choice.

4. The enterprise doesn't care

For the most part, the enterprise is looking towards adopting the iPad 2 or waiting to see what the Research In Motion BlackBerry PlayBook will offer. Realizing that, Xoom has largely lost the corporate world. It can try and make its case for corporate customers by highlighting some of the finer business features available in the device-such as its recently announced partnership with Polycom for MobileTelepresence-but if it doesn't work, it might just need to forget about the enterprise and focus on consumers for now.

How Xoom Can Be Rescued


5. The marketing is all wrong

One of the biggest issues with Motorola's Xoom is that it hasn't been marketed effectively. Earlier ads showcasing the device didn't do enough to tell customers what they would be getting with the tablet. The ads were too focused on flash and scant on substance. The time has come for Motorola to change strategy. It needs to make it clear to customers through its marketing that the Xoom is unique, it's a fine alternative to other devices, and it's worth the cash they will need to dole out.

6. Verizon needs to help more

Verizon Wireless could be one of the central elements in Motorola's plans to carve out a significant portion of the tablet market for itself. After all, the Xoom is available exclusively to Verizon customers that want to access a mobile network from the device. The only issue is, Verizon is torn. It sells the Xoom as well as the iPad 2. And as recent sales figures have shown, the iPad 2 is the better bet from a revenue perspective. Motorola needs to find a way to get Verizon to effectively promote the Xoom and give it more emphasis when customers enter Verizon stores. Right now, when one enters a Verizon store, the iPad 2 takes center stage. All others, including the Xoom, sit in the shadows. That's not good for Motorola's business.

7. Talk up the 4G

One of the core benefits of owning a Xoom is that it will soon allow customers to connect to Verizon's 4G network. However, Motorola hasn't spent nearly enough time talking about that benefit. In future, 4G should lead all of its talk about the Xoom. Not only will it appeal to corporate customers that have a mobile workforce, but it will give Motorola the chance to highlight one feature that much of the competition, including the iPad 2, lacks.

8. Take timing out of the equation

Motorola probably made a mistake by launching the Xoom so early. Customers that are planning to get their hands on a tablet this year have either already decided that they want an iPad 2, or they're waiting to see what the many other devices coming out this year will offer. At times, being early to the market is a good thing. But in the Xoom's case, it was a bad idea. Now, Motorola needs to take timing out of the minds of consumers that aren't decided on a tablet yet, and make them realize that opting for the Xoom now is a better idea than waiting to see what Samsung, Dell, and HP have in store.

9. It needs to stop competing against Apple

Let's face it: There is absolutely no chance that the Motorola Xoom will be able to overtake the iPad 2 in sales this year-or maybe any other year. To even consider Apple's tablet a real competitor is a bit of hubris for Motorola. Every tablet maker is competing for a seat at the tablet this year, but the head chair is Apple's. Motorola must acknowledge that and realize that its real competition is all the other Android-based tablet makers, as well as RIM and HP. If it can frame its strategy around that, it might have a better chance of competing.

10. If all else fails, launch a new one

The Motorola Xoom has been having trouble catching on. And although it's not a failure just yet, the company needs to do something now before it turns into one. However, if those actions fail and the Xoom continues to perform poorly at retail, Motorola will have no other option but to release another Xoom tablet. That device should show that Motorola has learned from the mistakes it made with the current product. But if it's just another Xoom with a few minor improvements, such a tablet will fail like its predecessor.

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