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Motorola Xoom's Weak Start Doesn't Doom Android Tablet Market

By CIOinsight  |  Posted 04-07-2011 Print
While Motorola's Xoom tablet may not be a retail superstar just yet, there's no reason to believe Android tablets won't seriously threaten Apple's iPad dominance.

Of all the tablets challenging iPad for market share, the Motorola Xoom was supposed to be the Ali to Cupertino's Frazier, striking a blow against Apple's dominance with a powerful combination of high-end hardware and the tablet-optimized Google Android 3.0 ("Honeycomb").

But fresh analyst reports hint that the Xoom, hit with early criticism over its premium price-tag and some half-baked features, isn't selling nearly as well as some hoped or expected. "Based on our checks, we believe overall sell-through trends for the Xoom ... have been disappointing," Pacific Crest analyst James Faucette wrote in an April 5 research note, as he slashed his 2011 revenue estimate for Motorola.

Meanwhile, Deutsche Bank estimated that Motorola has sold 100,000 Xooms since its Feb. 24 release. That would dovetail with a mid-March report from Global Equities Research, reportedlhy based on channel checks, which suggested the Xoom was selling at a sluggish pace.

The 10.1-inch Xoom sells for $599 with a two-year Verizon Wireless contract and $799 unlocked. It features a dual-core 1GHz processor, front- and rear-facing cameras for video conferencing, and 4G upgrade capabilities.  

Even as outside sources suggest the Xoom is struggling to find its footing in the marketplace, consumers seem to be flocking to the iPad 2, with widespread sellouts reported at Apple's retail outlets. Consumer Reports also gave the device a high rating, suggesting in an April 5 statement that "Apple is leading the tablet market in both quality and price, which is unusual for a company whose products are usually premium priced."

The publication tested 10 tablets, including the Motorola Xoom and Samsung Galaxy Tab, before deciding that the 32GB iPad 2 with WiFi and 3G ranked highest across 17 criteria ranging from portability to touch-screen responsiveness. The Motorola Xoom, meanwhile, tied in those rankings with the first-generation iPad.

It was tempting for many pundits to position the Motorola Xoom as a possible iPad killer. Should the device's confirmed sales numbers indeed prove mediocre, it would be equally tempting to see that lackluster performance as yet another sign the iPad has sucked all oxygen out of the tablet market.

For more, read the eWEEK article: Motorola Xoom Underperformance Doesn't Weaken Android Tablet Chances.


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