Motorola's Android 3.0 Honeycomb Xoom sales forecast slashed to 100,000 units

Posted:
in iPad edited January 2014
Google's flagship Android 3.0 Honeycomb competitor to Apple's iPad appears to have failed at launch, with Motorola Xoom sales estimated by Deutsche Bank to have reached just 100,000 units, a figure far lower than initial projections of failure from Morgan Stanley and RBC.



The Xoom has been hampered by a high initial price, low build quality, hardware features that were missing or nonfunctional, operating system and bundled software that was incomplete and unrefined, a scarcity of tablet-optimized applications and what appears to be a general absence of interest in tablets outside of the iPad.



Original estimates suggested Motorola would sell between 3 to 5 million units in 2011, a rate that would require as much as ten times the sales that analysts have estimated over its first two months. Instead, Motorola has reportedly sharply reduced its production orders as it evaluates demand.



In contrast to the estimated 100,000 Xoom units sold in its first two months, Apple sold 300,000 iPads on its first day of sales last year. In the final quarter of 2010, the company sold 7.33 million iPads, or about 2.4 million per month. The company is expected to announce official iPad sales figures for its most recent quarter of earnings later this month.



Apple was reported to have built around 2 million iPad 2s in preparation for launch, and is now estimated to be producing around 2.5 million units per month, with "conservative estimates" saying that Apple will begin producing 4 to 4.5 million per month to meet a growing demand that is outpacing last years'.







iPad enthusiasm fails to raise tide for other boats



While the original iPad was initially estimated to have limited sales prospects and was widely panned as being "just a big iPod touch," the unexpectedly high demand it generated in the market was immediately expected to spill over onto similar devices from competitors, including Dell's Streak and Samsung's original Galaxy Tab, both of which debuted as smaller 5 to 7 inch devices last year.



However, Apple's chief executive Steve Jobs predicted last October that such devices would fail in the market because they could not offer a clear advantage over smartphones, while also failing to provide enough screen real estate to support a real tablet experience.



Jobs also predicted that companies would abandon the 7 inch form factor this year, which both Motorola and Samsung have already done. Samsung announced a 10.1 inch version of its Galaxy Tab at February's Mobile World Congress, but then returned to the drawing board after the release of iPad 2, admitting that its first design was "inadequate." Samsung now hopes to deliver a Honeycomb tablet in June.



Honeycomb buzz suffers colony collapse disorder



Motorola's Xoom was first to market with Google's Android 3.0 Honeycomb operating system, the initial version of Android specifically designed for tablets. The Xoom was originally billed as being significantly faster than iPad, capable of running Adobe Flash, and promoted as having a more engrossing 3D user interface, complete with video conferencing capabilities the original iPad lacked.



However, the subsequent release of Apple's iPad 2 erased Xoom's speed advantages, added FaceTime cameras and undercut it on price, while Android's delayed, experimental support for Flash is still not able to deliver reasonable performance even for web videos, let alone the majority of Flash content that was originally designed to work on full power Windows PCs equipped with a mouse.









Google's Android 3.0 Honeycomb platform has also handicapped iPad competitors with unfinished edges such as a lack of HTML5 web savvy and a paucity of polished first or third party apps comparable to Apple's own Pages, Keynote, Numbers, iMovie and Garage Band and the more than 65,000 other third party iPad-optimized apps now available.



The openness of Google's Android platform has also distracted customers from getting a clear picture of what Honeycomb tablets actually represent. Prior to Google even finishing its tablet-oriented release, Android licensees such as Dell and Samsung began offering tablets running Android 2.2 Froyo against Google's recommendations, resulting in hardware with clear disadvantages and lacking an ability to upgrade to the planned 3.0 release. Google has since suspended access to Android 3.0 source code to prevent further unanticipated use of its formerly open source code.



Motorola's false start with the Xoom threatens to blight the outlook for Honeycomb tablets in advance of a series of similar offerings from Samsung, Acer and Toshiba expected to hit this summer. LG is also rumored to be partnering with Google to deliver a "Nexus" branded tablet that may divert attention away from other Honeycomb tablets in the same way that Microsoft's Zune destroyed the market for PlaysForSure media players, and as its Nokia partnership may likely starve initial interest from other competing Windows Phone 7 devices.



A high profile failure for Motorola's Xoom could poison the well for subsequent Honeycomb tablets much the same way that the failure of initial Google TV appliances from Sony and Logitech appears to have erased the prospects of mass consumer demand for an Android-based set top box.



Bleak outlook for tablets outside of iPad



Deutsche Bank analyst Chris Whitmore warned in a note yesterday that "iPad challengers must either undercut on price (negative margin implications) and/or offer a superior user experience," and said his firm's tablet estimates remain below consensus "due to our concerns that non-iPad tablets will underwhelm."



Whitmore also announced slashed PC growth estimates, from initial 9 percent year-over-year growth in 2011 to just 4 percent, primarily due to weakness in the consumer market due to cannibalization by smartphones and iPads.



"We believe weak end demand in Europe and the U.S. is directly related to pressure from both the iPad and smartphones, where consumers continue extending the lives on existing hardware," Whitmore wrote. "On the other hand, corporate demand remains healthy with no signs of a slowdown as the upgrade cycle continues unabated."



He added that it "appears that iPad cannibalization [of PC sales] is tracking above our original 30% cannibalization estimate. As discussed in prior research, Apple remains the primary beneficiary of this technology transition which is increasingly coming at the expense of PC vendors (Acer, HPQ, etc)."
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Comments

  • Reply 1 of 172
    robin huberrobin huber Posts: 3,141member
    Ah, Deutsche Bank, thanks for the opportunity for some good ol' schadenfreude, mit schlag.
  • Reply 2 of 172
    dishdish Posts: 64member
    I consider this DOA QED. No surprise. All the competitors are competing against laptops and desktops as opposed to competting against the iPad. This is evident when you consider that they are all hell bent on promoting specks and complexity where as the iPad is about simplicity and doing basic tasks well and very fast. Putting one of those tablets up against a laptop or desktops an instant failure since most people already have one of those devices and more than capable.



    I'm seeing a lot of average non techy types asking me about the iPad and going out and buying them....never ONCE do they show any awareness that there are competing devices to consider, it's truly amazing, I've never seen that happen with any device. I think the carnage is going to catch everyone by surprise at how big they all fail.
  • Reply 3 of 172
    apple ][apple ][ Posts: 8,360member
    Wow, that's some real impressive figures there. 100,000 is how many iPads Apple sold yesterday probably.



  • Reply 4 of 172
    This confirms my claim that we shouldn't be giving so much attention to these non-iPad tablets, these things are extremly over-hyped, very few people are buying them, there's no comparison and iPad is just in another league.
  • Reply 5 of 172
    adonissmuadonissmu Posts: 1,770member
    Android? No Interest! Let me know when Apple has an announcement about it's sales.
  • Reply 6 of 172
    bilbo63bilbo63 Posts: 285member
    I for one, am shocked. Hehehe.
  • Reply 7 of 172
    apple ][apple ][ Posts: 8,360member
    Quote:
    Originally Posted by AdonisSMU View Post


    Let me know when Apple has an announcement about it's sales.



    That would be in exactly 14 days from now. April 20.
  • Reply 8 of 172
    BuffyzDeadBuffyzDead Posts: 311member
    This is simply NOT POSSIBLE.



    Not with Flash Support, Honeycomb

    AND



    a whole entire ONE GB of DDR2 RAM.



  • Reply 9 of 172
    Quote:
    Originally Posted by Robin Huber View Post


    Ah, Deutsche Bank, thanks for the opportunity for some good ol' schadenfreude, mit schlag.



    AEL! (auf der Etage lachend)
  • Reply 10 of 172
    neiltc13neiltc13 Posts: 182member
    "experimental support for Flash is still not able to deliver reasonable performance even for web videos"



    You mean the final version of Flash, available on Android Market that delivers video perfectly as the below example shows?



    http://www.youtube.com/watch?v=gq6xzyxVYg0
  • Reply 11 of 172
    iOS is simply a better experience. the only reason android is even a subject is because 1, carriers subsidized them down to free and 2, the iPhone took 4 years to get on verizon.



    it will be interesting to see if people buy the xoom when they slash the price to under $400.
  • Reply 12 of 172
    solipsismsolipsism Posts: 25,726member
    Has it at least been updated to allow the SD card and USB ports to work? Any date on when they let you mail it back to the factory so they can finish building it?
  • Reply 13 of 172
    nagrommenagromme Posts: 2,834member
    It doesn’t matter if sales are lower or ramp up gradually. All that matters to make the Xoom a success is if it has pretty close to the iPad’s selection of apps and games, and that they’re of equal quality, with developers making money to keep supporting them. Assuming that battery life remains good once Flash is working, that the OS itself matches iOS for ease and simplicity, and that Motorola can match Apple’s sub-$500 entry-level price, then it’s really only the apps that matter. Hopefully Android’s app situation is about as good as on iOS...





    Quote:
    Originally Posted by OllieWallieWhiskers View Post


    iOS is simply a better experience. the only reason android is even a subject is because 1, carriers subsidized them down to free and 2, the iPhone took 4 years to get on verizon.



    it will be interesting to see if people buy the xoom when they slash the price to under $400.



    Android is beloved of a certain subsegment of hard core, old-school, under-the-hood, troubleshooting-addicted, tech-savvy people. (People like us who frequent tech forums! But specifically, the Apple-hating subsegment who cling emotionally to buzzwords instead of looking at what each product delivers in actual use. Who prefer choice and power on paper instead of choice and power in reality.) That subsegment is not enough to drive sales... BUT sadly, every one of those Apple-haters influences the buying decisions of 10 regular people. (People who do NOT want to fuss with their computers, and could really benefit from an iPad.) In the short term, until those regular people get fed up and buy an iPad (or an abacus), that WILL generate some sales.
  • Reply 14 of 172
    100,000? Really? Only 100,000!?

    I would have thought at least 3-400,000 just from anti-Apple folks.
  • Reply 15 of 172
    Quote:
    Originally Posted by studiomusic View Post


    100,000? Really? Only 100,000!?

    I would have thought at least 3-400,000 just from anti-Apple folks.



    I think you're over-estimating the number of "anti-Apple folks", people might say stupid things on the internet, but that doesn't mean they'd throw money away in real-life, in fact more of those people are perfectly normal folks who would never even say those anti-Apple things in real-life.
  • Reply 16 of 172
    solipsismsolipsism Posts: 25,726member
    Quote:
    Originally Posted by studiomusic View Post


    100,000? Really? Only 100,000!?

    I would have thought at least 3-400,000 just from anti-Apple folks.



    I would have imagined 100,000 just from DaHarder.
  • Reply 17 of 172
    neiltc13neiltc13 Posts: 182member
    Quote:
    Originally Posted by OllieWallieWhiskers View Post


    iOS is simply a better experience. the only reason android is even a subject is because 1, carriers subsidized them down to free and 2, the iPhone took 4 years to get on verizon.



    it will be interesting to see if people buy the xoom when they slash the price to under $400.



    iPhone is available on 5 carriers in my country and for free from many of them:



    http://www.vodafone.co.uk/brands/iph...hone/index.htm

    http://shop.o2.co.uk/mobile_phone/pa...e_4_16GB_Black

    http://shop.orange.co.uk/iphone/choose-your-4g-plan



    Yet I know more people with an Android phone than an iPhone. I think your reasons are a bit out, or at least don't consider any markets outside USA.
  • Reply 18 of 172
    alfiejralfiejr Posts: 1,524member
    Quote:
    Originally Posted by studiomusic View Post


    100,000? Really? Only 100,000!?

    I would have thought at least 3-400,000 just from anti-Apple folks.



    you forget, probably another 100,000 of those suckers already bought a 7" Samsung Galaxy tab months ago. leaving about 2 million of those "shipped" Galaxies unsold too. probably sitting in discount bins throughout Asia.
  • Reply 19 of 172
    samabsamab Posts: 1,953member
    Motorola HAD to launch because they were splitting the company into two --- despite the fact that Honeycomb was an ugly hack that was far from production quality.
  • Reply 20 of 172
    mennomenno Posts: 854member
    Quote:
    Originally Posted by studiomusic View Post


    100,000? Really? Only 100,000!?

    I would have thought at least 3-400,000 just from anti-Apple folks.



    Up until not even 2 weeks ago the only version of this device available was the Verizon 3g version, which most places wouldn't sell without you signing up for some form of agreement. The wifi version JUST launched in stores, and it's not even really available overseas yet.





    The launch was a failure because of poor planning on motos part. But do you REALLY expect that 300,000-400,000 Verizon Tablets would sell? I'd honestly be surprised if Veirzon sells that many of their 3g ipad2. Wifi tablets are where it's at right now.



    most people don't want a tablet tied to a cellphone bill, ipad sales have shown that.
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