I suspect this is just HP clearing out the supply chain of already purchased parts and units still at the factory. HP's cost is probably just a few dollars per unit to ship and possibly assemble them.

I find it hard to believe anyone approved an entirely new order of parts at $300 BOM just to sell them for $99.

You may be right, but if it's not an ops guy getting fired, then it should be a PR guy. I mean, look at this:

"Before I share, let me first say thank you for enthusiasm for this product. Since we announced the price drop, the number of inquiries about the product and the speed at which it disappeared from inventory has been stunning. I think it’s safe to say we were pleasantly surprised by the response.

Despite announcing an end to manufacturing webOS hardware, we have decided to produce one last run of TouchPads to meet unfulfilled demand."

They didn't decide to produce one last run to meet unfulfilled demand, they're producing one last run to get rid of unused parts. Just put the new devices up on the store and send out a tweet; don't spin this like some grand gesture to please your adoring fans.

You're expecting a PR person not to spin it like some grand gesture? Have you ever heard any company say anything to the effect of, "well, we already paid for a bunch of parts, so we might as well?"

I don't understand all the down-votes. This seems like a valid and well-meant contribution to the discussion, being voted down because it presents something slightly contrarian. Why is martingordon's suggestion any more unworthy of HN than the earlier suggestion that the person responsible for this new run be fired? They're both looking at this news inquisitively, trying to understand the forces behind the public actions of HP following their recent mutation.

If you're voting it down, just be sure you're not doing so out of disagreement with the points raised.

A downvote on a contributor can be, and frequently is, a vote of disagreement, regardless of how well intentioned and expressed the contributor was.

If I cared enough about the space to make a karma-based threading system, I would attempt to come up with a way to differentiate disagreement with contribution score (aka karma).

Sometimes people feel the need to register disagreement but can't be bothered to write a specific reply as to why, and while it sucks that many people do that via downvoting the contribution score, it is understandable why they do it and there is probably a better fix for it than just telling them they shouldn't do it (they won't listen).

Hiding a valuable contribution because you disagree with it probably isn't the intended purpose of the system. Hiding something that lessens the quality of the conversation, independent of the skew it takes, makes more sense.

It doesn't matter what the common practice is. What matters is preserving the integrity of the discussion.

If it's heavily down-voted, then it's probably not conspicuously valuable. Indeed, that's exactly the point.

A PR guy wrote this, what did you expect?

what's BOM? Bill of Materials. Got it. BoM. Just before reading your comment I had bought a 32 gb for $270. Guess that's not a bad deal. Hopefully I can at least skype on it.

Bill of Materials.

No, it's whomever decided to set the price at $100 who should be fired. This excessive demand shows that they could easily have charged $150 or maybe even $200 for the 16GB version, and still gone through their supply, with less hassle for retailers, and less of a loss.

There is a such a thing as a demand curve. I bought the $100 one.

Here's how I'd think about

$100 -- I'd Bite $110 -- I'd Bite $120 -- Okay $130 -- Uh, maybe. I'll flip a coin. $140 -- It's an okay deal. I might pass. $150 -- I'd probably pass.

That's my curve. Others have their own curve. If everyone is like me, which they're not, $125 is probably the right price point. I can't imagine spending $200 or even $150 for webOS.

Here's to there being an Android release in the next month or so!

I think the fact that 32GB models at $150 sold out just as fast supports the idea that your "demand curve" is the one that is different from the average consumer.

Also in support of this are the crazy prices people are paying on eBay for them right now, upwards of $250 for a 16GB model. It's pretty clear they could have sold them off quite briskly at $150/$200, possibly even just as fast. It seems the resellers nabbed most of them anyways.

Also, the $99 pricing got them a lot of good press because it was a very good deal. An average deal would have no press so no sales, the sales are not a linear correlation of the pricing.

When a cheap tablet is $300-$350, a $150/$200 price point would have netted them just as much press. Frankly, they could have done with a little less exposure.

I live in Canada, I ran out of my house and hopped on the subway the moment I heard the news and I posted the first comment on the TIMN article about the fire sale from my phone on the way. I checked the Best Buy, Future Shop & The Source. I also ordered two online, one from Best Buy and another from Dynamism.

I didn't get a single one, or even see one being purchased. They were all gone in the first 20 minutes from retail, employees bought up any remaining retail stock at smaller or less urban stores that night. Online stores sold out while I was on the subway.

That wasn't just high demand, that was completely insane demand. There is just not a snowball's chance in hell that a $50 bump would have a serious effect, other than possibly dragging the sell out process from minutes to hours. It may have also saved a little money in CSR wages, considering a bunch of businesses had to cancel hundreds and thousands of orders that Monday.

> the sales are not a linear correlation of the pricing.

This is true, likewise it's not this extremely clear line where $100 is absolute Black Friday-esque insanity and $150 is gathering dust on the shelf.

Not just that, on eBay and various Amazon retailers the prices seem to have stabilized at around 250 USD or even up to € 250 in Europe. If HP chooses this price point most of the current demand will still be there, especially if I could just walk up to an electronics store and get one!

I doubt it works like that. I imagine that they have a load of parts already purchased, and probably some spare labour time. Supply chains don't just stop when you click your fingers.

i guess it depends how you look at it ... for $100m they are certainly going to get huge mileage for their Brands - its like marketing drive for HP, WebOS, WebOS App catalog etc. + they will make some money by selling apps. Also one has to remember that this brand value creation will help them fetch more $$$ when they decide to sell their h/w business and WebOS business (either the whole OS or licensing it) - All in all $100m is worth loosing (spending) :-)

In fact they should turn this accidental success into super-success by creating HUGE WebOS ecosystem for at least a year and then decide what to do with it - they can get more money by selling or licensing the whole ecosystem with millions and millions of users worldwide than wrapping things up pre-maturely ... also can you imagine how much they could make if they start streaming & selling music, movies, ebooks etc. thru their ecosystem ...

at the scale of HP's finances and bureaucracy it is just a drop in the bucket and any reasoning behind it isn't comprehensible by a single unit of human species.