Verizon Samsung Galaxy Tab Pricing Puzzles Analysts

Analysts express surprise at Verizon Wireless' aggressive $500 price tag for the Samsung Galaxy Tab, the Android 2.2 tablet geared to challenge Apple's iPad.

Most analysts are surprised by Verizon Wireless' $599 price point for Samsung's Galaxy Tab, which is $100 more than the base model of Apple's popular iPad and only $30 less than the base iPad WiFi + 3G offering.

Verizon Wireless will begin selling the Galaxy Tab Nov. 11. No contract is required, though Verizon customers can add an access plan for $20 a month for 1GB. The device is equipped with a 3G radio.
"I was surprised at the high price point as well," industry analyst Jack Gold told eWEEK. "I expected more aggressive pricing. 3G should only add $50 to $100 max to the cost of the device, so I don't think that is the primary cost motivator."
When Samsung introduced its Galaxy Tab last month in New York, the light, 7-inch-screen device based on Google's freshest Android 2.2 operating system was well-received as an alternative to the iPad.
Unlike the iPad, the Galaxy Tab supports Adobe Flash, a boost for consuming Website content, and offers a front and back camera to enable video calling.
However, many believe that to compete with the popular iPad, which just sold 4.19 million units, the Galaxy Tab would have to come at a lower price point than its market-launching rival. The water-cooler talk was that Samsung and carriers would sell the iPad for $299 to $399.
That's clearly not the case for Verizon, which is unapologetic about its price point for the tablet. A Verizon spokesperson told eWEEK:
"Customers will ultimately decide, but we're comfortable with the price for what we feel is a very compelling product on the nation's most reliable network."
Current Analysis analyst Avi Greengart told eWEEK that while the Galaxy Tab is lighter and more portable than the iPad, consumers justifiably expect the larger iPad to carry a premium price and the smaller Tab to be discounted.