Hewlett-Packard (HP) reportedly will launch a US$99 tablet and will cooperate with Wal-Mart to sell the device in the US retail channel, targeting back-to-school demand, according to sources from the upstream supply chain.
The US$99 tablet is manufactured by China-based BYD and is the second tablet that HP has outsourced to the China-based maker. The device adopts a 7-inch touch panel and Intel's Medfield-based single-core processor.
In early 2013, Acer released its 7-inch Iconia B1, priced at US$150, which was the cheapest 7-inch tablet at that time, and in mid-2013, Asustek Computer announced at Computex 2013 the MeMO Pad HD 7, using a solution from MediaTek with a price of US$129, dropping tablet pricing to a new level.
Some market watchers already forecast that a sub-US$100 tablet would appear in the third quarter at the soonest, and if HP decides to release the tablet, it could trigger other vendors to follow suit, the sources said.
This is the second time HP offered its tablet at US$99. In 2011, HP slashed its TouchPad's price from US$499 originally to US$99 to quickly clear out inventory due to weak demand. As a result, HP suffered great losses which impacted the device's manufacturer Inventec.
After 18 months, HP has returned to the tablet market, but has chosen to cooperate with China-based BYD for its tablet devices. Although HP had many issues such as shipment quality, the US brand vendor continues to outsource its new products to the China-based maker, indicating that Taiwan makers are losing their advantages and seeing their influence in the IT market weakening as the IT market gradually becomes price-oriented.
However, some market watchers believe that HP's US$99 tablet may not be able to gain advantages in the market as the tablet will be selling mainly through specific retail channels, limiting its overall sales volume, while the tablet's Intel single-core processor specification, compared to other vendors' quad-core ARM-based processors, may pose difficulties to attract consumers.
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