HP TouchPad crashes and burns, HP gives up

HP TouchPad was released barely a month ago but the tablet never took off and HP pulled the ejector handle. A win for Apple's iPad. A lose for those who bought an HP TouchPad.

Eric Risberg/AP
HP TouchPad discontinued: The HP TouchPad is displayed in San Francisco, June 27. In a dramatic reshuffling, Hewlett-Packard Co. on Thursday, said that it will discontinue its tablet computer and smartphone products.

Hewlett-Packard are giving up on their TouchPad tablet after a painful defeat, Thursday. The company is also ditching other hardware using TouchPad's operating system, meaning more discontinued products may be announced soon.

The HP TouchPad was announced in February but from the outset they had techies questioning key decisions. The launch was set for months later in the summer, which had many scratching their heads. It wouldn't nab the back to school shoppers, or compete with any scheduled iPad release. At the time it also seemed like an awfully long way off.

Then, on July 1, the TouchPad was released to mild fanfare and curiosity. It was immediately scorned for a lack of apps, sluggish performance, clunky user experience, and frequent errant keyboard presses.

But the news wasn't all bad. Many users liked them, and average user ratings on the Best Buy website (if they can be believed) were on par with the iPad 2's ratings.

But still sales weren't picking up. In just five weeks HP dropped the price of the TouchPad drastically to entice buyers. But consumers didn't bite, and reports came in that many were waiting for yet another price cut.

What a difference a week makes.

Reports began coming in that Best Buy had sold less than 10 percent of their inventory of 270,000 TouchPads and was trying to sell them back to HP to no avail. Meanwhile, Apple had sold 9 million iPads the previous quarter and were backordered for weeks. Apple couldn't make units fast enough, and TouchPads were starting to look like bricks in store inventories.

Before the news of distressed inventory at Best Buy made big news, HP had already come to a decision. On Thursday, HP announced it would discontinue production of the TouchPad.

CEO Leo Apotheker said in a conference call, "Our TouchPad has not been gaining enough traction in the marketplace. We have made the difficult but necessary decision to shut down the WebOS hardware operations."

That means that it won't just be the TouchPad that is affected. WebOS, inherited by Palm, Inc., which they bought last year, is used in HP smartphones as well. While no specific models were named, expect many to be discontinued.


Just one week before, early adopters were up arms that they had been punished for buying early after HP announced the $100 price cut. No word on support for the TouchPad, but discontinuing operations indicates TouchPad users can expect the short end of the stick on that front.

Users weren't the only ones left shocked that HP seemed to have gotten it so wrong.

The announcement that HP would be discontinuing WebOS devices was followed by favorable reactions on Wall Street. At its high, HP stocks were up 13 percent, Thursday. However, by the end of the day stocks had fallen and were down 6 percent overall at the closing bell.

[Editor's note: the original version of this story did not clearly differentiate between WebOS and WebOS devices.]

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