“Motorola mobility chief Sanjay Jha confirmed that the company’s new Xoom tablet will go on sale in the U.S. at $800, a higher price tag than current market leader Apple’s iPad,” Ben Rooney reports for The Wall Street Journal.
“Mr. Jha, speaking to reporters at Barcelona’s Mobile World Congress, said a device that was 4G compatible on U.S. carrier Verizon’s network was worth the extra money. A 32GB iPad with 3G currently retails in the U.S. for $729,” Rooney reports. “‘We felt that our ability to deliver 50Mb/s would justify the $799 price point. It is 32GB with 3G and a free upgrade to 4G. Being competitive with iPad is important. We feel that from the hardware and capabilities we deliver we are at least competitive and in a number of ways better [than the iPad].'”
MacDailyNews Take: Jha apparently doesn’t understand the value of a coherent ecosystem or thinks his potential customers don’t. In either case, he’s wrong.
Rooney continues, “He did admit that Samsung’s experience with the Galaxy Tab had shown that the sell-through and the return rate on tablets launched so far have been ‘concerning.’ Nevertheless the company was going to launch a product more expensive than the market leader. He promised a Wi-Fi-only version would also go on sale. He would not be drawn on the exact price, but said it would be ‘meaningfully cheaper. The price is set by iPad at $599 and we will be right around there.'”
MacDailyNews Take: Dude’s got nothin’. Plus, he’ll be trying to compete against what Apple unveiled over a year and 15+ million units ago. Oh, to be there as he watches Apple’s iPad 2 unveiling!
Rooney continues, “In a wide-ranging, and at times admirably frank, interview, Mr. Jha also spoke of his concerns about how the Microsoft-Nokia deal would make it harder for existing players in that area. He hinted at his frustration at having to tie his company so closely to someone else’s product, Google’s Android operating system… Almost ruefully he said he wished Motorola was able to control its own operating system, but he lacked the scale to build his own ecosystem.”
Read more in the full article here.
MacDailyNews Take: The only place Xoom is going to zoom is straight into Costco clearance bins.
Motorola Mobility currently has about 20,000 employees. That is just a bit below half the number of employees at Apple. Now, in addition to mobile products (iPhone/iPad), Apple also makes portable media players (iPods), desktop, notebook and sub-notebook computers (MacPro, Mac mini iMac, MB/MBP, MBA), servers, as well as professional desktop and mobile software (Final Cut Studio, Logic Studio, Aperture, iWork), plus consumer software (iLife). Motorola Mobility only makes mobile devices.
If we go by numbers, Moto Mobi has more than enough (human) resources to develop their own OS and eco-system. Obviously, numbers don’t tell the whole story…
Yeah, but out of those 20,000 employees, how many have the title of Vice-President of “fill in blank” on their business card?! LOL : D !! How I miss the emoticons… : (
🙂 So do I … Whoops.
Apple has a streamlined product group, only 1 iPhone. Moto is developing all kinds of mobile devices, overlapping and undercutting each other. Remember, one of the key strategies Job’s first employed in his return to Apple was to rationalize the product line.
Moto needs to do this, but falsely believes that it can leverage the low end from work done on the higher end devices.
All this strategy does is hold down the price of the high end phones and divert effort to the low end of the market where you chase volume and almost no profit.
You also have to remember a lot of those Apple employees (almost 27,000) are people who work in the retail stores in a customer service/assistance position.
I believe the last report shows that Apple now has almost 47,000 full time employees.
How about this figure for comparison:
Revenue per employee:
Apple $1.544 million
Moto $0.3976 million
So Apples brings in nearly 4 times as much per employee — that leaves a lot for R&D…
If Motorola’s mobility chief Sanjay Jha was all that smart he would do well to examine the reasons Nokia rejected Android and then he should beg Microsoft for a similar deal. That just might save his company and return it to profitableness.
Of course he would have to build better hardware but that is another problem he needs to deal with.
I don’t know about that MDN take.
There has to be 2 or 3 Apps ready to go for Xoom already.
The concluding MDN take, brilliant. Costco deserves the diss.
Me wants a Xume right away.
Meant to say Zume.
When Apple placed those million, or was it billion, dollar pre-purchase orders of supplies, screens and what not, would it be safe to assume that Apple got a discount? If they did get a discount on some of the “parts’ that make the iPad, then would it be safe to assume that possibly, Apple may slightly reduce price of iPad 2 as it increases the capabilities, value, and tech specs?
Also beside emoticons, wish could edit posts…. : (
When Apple placed those million, or was it billion, dollar pre-purchase orders of supplies, screens and what not, would it be safe to assume that Apple got a discount? If they did get a discount on some of the “parts’ that make the iPad, then would it be safe to assume that possibly, Apple may slightly reduce price of iPad 2 as it increases the capabilities, value, and tech specs?
Xoom is being priced against last years model. And it would be interesting to see what kind of profit margin is built into the thing. It’s one thing to build something and make money and an entirely different thing to build something for the sake of building something and hope to ride the coat-tails of Apple’s success and sell a few and make a buck!
Huh? The iPad set the WIFI-only price point at $499, not $599, so either he’s wrong or the article is misquoted.
I think he is comparing the WIFI 32GB XOOM to the WIFI 32GB iPad… which is $599.
If you had written “non-existent” WIFI 32GB XOOM then you would have been correct! Don’t you love it when would-be competitors say that their future product will be price competitive with an existing Apple product when (if) it is every released.
It is good to be the king! Long live the king!
its interesting to read the Apple perspective. Oh the “spin”. How about waiting until the iPad2 launches before you accuse Jha of wishing he worked at Apple. The reality is that Apple has failed as many times as it may have succeeded. the iPad was a feature weak oversided iTouch. And 15 million Apple enthusiast and users who wanted to be early to the cool tablet market jumped on. The remaining 6.9billion inhabitants on this planet didn’t get one. I’m sure there are another 15 million people who want a tablet with a camera..that’s actually fast, can play quality video (including flash), etc.
@the pot
If the iPad was so “feature weak”, why has the FDA approved it for the viewing and diagnosis of MRI, PET and CAT scans or why is the iPad is receiving approval from both the FAA and CAA as a replacement for flight bags? Please show me another device that has received such approval – oh, you can’t because there are no other devices to receive such certification.
There are morons… and then there’s you!
=:~)
My dad is not one of the users who wanted to be early to the cool tablet market. He bought an iPad because it is something he can use sitting in his easy chair while watching tv, and it’s easy to use, even for an 84 yr. old, non-techie guy. Hardly an “early adopter, fanboy.” Apple hit a home run with this product, and everyone else is chasing like hell, knowing they’ll be left in the dust if they don’t do something. So… copy, copy, copy… it’s all about reacting, not innovating for these other companies. Even a young child can see this fact.
My dad shook his head when I was showing my mother my new iPad. He looked over her shoulder a few times when she was playing around with it.
We walk away… My dad sits down and opens up my WSOP Texas hold em game…. Then a few other games as well. He wouldn’t give the iPad back.
Now he already said he would buy my iPad when I upgrade to the iPad 2.
Actually, you lost all credibility when you mentioned “Flash” and quality video in the same sentence…..
Wow, you’re clueless. Apple is selling iPads as fast as it can make them. The only reason “6.9 billion” people don’t have an iPad is because Apple can’t make enough, and there will always be about 100,000 who just won’t buy it because Apple makes it, no matter how good the product may be.
No tablets sold in any appreciable numbers until iPad came out. And it is much, much more than an oversized iPod touch (there is no “iTouch” product).
Flash? Really? That’s your argument? I guess it’s important, if you only wanted to watch half of the video . . . .
Make that Future ex-Motorola Mobility CEO Sanjay Jha…
Soooo, $800 wasn’t a typo?
50Mbps?? Verizon themselves say their LTE network offers 5-12MBps.
Edit: 5-12Mbps
Yeah, that was my biggest bwah ha ha of this article. Maybe i’ll get one just to be part of the class actiom
“… he wished Motorola was able to control its own operating system, but he lacked the scale to build his own ecosystem.”
So, knowing that you can’t match or exceed the OS or ecosystem, why would you waste money developing something that will never match the expectations of the customer? Clueless!
It’s way beyond clueless. Jha’s remarks point to the daunting task of creating a viable/thriving self-controlled ecosystem. Apple has perfected this game. HP is just stepping into the pool. Others will continue to rue/look from afar trying to dance with Google or Microsoft. Eventually, only the strongest self-contained systems will prevail. Everything else is headed for the Costco dump.
After bashing Apple, Jha basically said that he wished that Motorola was Apple. Because he wants to do what Apple has already done.
Don’t feel bad, Mr. Jha. Everyone else feels the exact same way…
Sounds like a big, fat FAIL.
The only good thing for Costco is that they require the suppliers to buy-back any and all unsold products. I’m thinking this is going to be one expensive lesson for Motorola.
And I hear they are not even achieving 12 sustained. BURSTS to 12. it’s more like 3 – 7. a lot of hype for no real delivery.
I should add, those speeds FAIL the specification of 4G. Someone should sue them for false advertising.
Motorola Mobility sounds analogous to a company selling electric disability carts.
@MDN and krquet:
I protest – how dare you disparage Costco like that! Try Railroad Salvage, Overstock.com or Refurb Depot as likely places for this turd to wind up. Even Refurb Depot may be too good, I’ve bought some decent stuff there….
So Motorola isn’t happy with Android and wish they could have their own platform now!? As I said before, this will be the reason Android will eventually fade into obscurity; OEMs wishing to build their own platforms to differentiate their products from all “other” mobile devices.
Apple’s platform must be the envy of the entire industry. The thing is, it’s taken them almost 10 years to build it. Good luck trying to catch or match it. Just think about all the media content that’s available. All the hardware; peripherals and docking stations. All the accessories.
4G on Verizon, according to it’s website:
http://network4g.verizonwireless.com/#/coverage
won’t have full coverage until 2013 (if you believe Verizon is being accurate here with their guesstimate/timetable).. Check out the current map it’s a few tiny dots on US map currently. Motorola using 4G as a plus on their platform isn’t going to benefit ALOT of people near term. Motorola jumped the gun here and at the same time missed the boat (not having their own OS ecosystem).
Why in hell would you want to pay extra 200 for 4g when 3g has not being full filled?
3g is capable of 14Mbits, can you tell me which company is delivering 14mbits in the all world?
I’ve tried a couple different 4G modems in NYC and Jersey City on Verizon and Clear and I am getting max 4 – 6 Mbps.
I get similar speeds on 3G HSPA+ modems, so what’s so great about 4G – I’d say that the technology is not here yet and will be obsolete by the time it is widely deployed.
Hey, I called it exactly. That earlier $1200 rumored Best Buy price tag was bogus. It was probably an intentional marketing ploy to make some buzz. Now that the “correct” price is revealed to be $800, the Fandroids will think it’s a bargain. Not much of a deal compared to iPad (even before iPad 2), but better than $1200, for the irrational Apple-haters.
Now that Apple can easily undercut the competition on price (using efficiency and high volume), Apple has BEST quality, value, AND price. How can anyone compete with that…?
I’ll buy a good android tab when it’s $200 or less… 🙂
Like Famous Grouse wrote, you can pick up your $200 android tab at Costco, Railroad Salvage, Overstock.com or Refurb Depot. Enjoy!
I just picked up a VzW 4G LTE USB modem and I was getting 19.75 Mbps down at my house (I am 40 miles out of NYC). I don’t understand the venom about EVERYTHING non-Apple from you guys.
You do realize that “good android tab” is an oxymoron, right? 🙂
I’d bet the the iPad 2 releases we see an 8/16gig model at $399 and a 32 at the 16s old $499 price point and a 64 at $599. Apple is moving the quantities to push prices lower and no one else can match them.
Beat ya to that thought… that was so an hour ago! (hehe)
HSPA+ is often called 4G by operators