PALO ALTO, Calif. (
) -- Consumer reaction to
TouchPad fire sale proves that there is growing desire for a low-price alternative to
iPad, according to analyst.
"It establishes that consumers do have an appetite for non-iPad tablets if they are cheap enough," said Sarah Rotman Epps, an analyst at tech research firm Forrester, in an email to
HP, which rang the
hardware last week, has dramatically slashed its TouchPad pricing. With a 16-gig tablet now selling for $99 -- $300 less than its prior list price -- customers have scrambled to get hold of the devices. On Monday, HP.com said that TouchPads had been sold out, as did retailer
Apple's cheapest iPad is $499.
Adding to the cheap tablet craze could be the fact that consumers are becoming more price sensitive with regard to tablets. Almost half the respondents to a recent survey from research firm Retrovo said that $300 was the price point that would get them to consider an Android tablet over an iPad. Some 79% of respondents also said that they would consider buying an Android device over an Apple tablet if it cost less than $250.
said to be planning an
, this pricing trend could have major ramifications for the broader tablet market.
"Apple has traditionally been able to command a price premium for quality devices, but if someone like Amazon, who thrives on low margins can move the playing field, Apple may find it harder to command high prices," said Retrovo in a note on its Web site. "Despite the fact that Apple makes a lot of money on companion products like apps, music, and software, Amazon may be in a better position to sacrifice a high profit margin on a tablet or 'razor' in return for revenue from 'razor blades' like books, music, videos and apps."
HP shares climbed 4.24% to $24.60 Monday after experiencing a massive sell off on Friday. Amazon's stock was up 1.11%, to $180.91.
--Written by James Rogers in New York.
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