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People don't want tablets, they want iPads

Mountain of unsold fondle-slabs piles up, prices slashed

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The phenomenal sales success of Apple's iPad shows no sign of abating, but sales for all other tablets competitors are stagnating and channel inventories are building.

US tech titan HP is the latest to correct its prices, trimming £50 off the cost of a TouchPad in an effort to get them shifting, with the 16GB and 32GB versions now available for £349 and £429 respectively.

"This move will help bring TouchPad and webOS to a larger audience, benefiting consumers and developers," HP said in a prepared statement sent to The Register.

"Vendors in many industries often offer a variety of pricing actions with the launch of products. HP is providing this new pricing action as an additional incentive for customers in their decision-making process," the vendor added.

Shaving the equivalent of just 12.5 per cent off the entry level TouchPad and a little over 10 per cent on the 32GB system will hardly breathe new life into flatlining sales.

Numbers from channel analyst Context, which tracks actual sales out data, show that 15,000 TouchPads were sold in Western Europe last month – but 12,000 of these sales took place in the UK. Regionally the next highest selling vendors were Acer and ASUS, with 8,000 and 7,000 shipped respectively.

But in the first week of August, HP resellers and distributors managed to punt just 700 across the Western Europe – 100 in the UK – while HP's Taiwanese rivals flogged a combined 2,300 devices across the region.

In contrast, Apple knocked out 160,000 units through distribution last month and another 43,000 in the opening seven days of this month.

Salman Chaudhry, Context product manager for mobile computing, said it was difficult to quantify stock levels as his company only tracks sales out, but anecdotally, he said he had heard there was a glut of tablet stocks in distribution for all vendors except Apple.

"Only the iPad is selling well, inventory on all others seems to be building up in distribution as sales are slow," he revealed.

Ironically, Samsung's Galaxy Tab 10.1 would have challenged Apple in terms of size, weight and specs, said Context, but last week a court in Germany ruled that aside from in the Netherlands, the product could not be sold in the EU as it flouted an Apple patent.

Interestingly, Chaudhry said that only iPad prices had held firm since launch, save for the impact of currency fluctuations, while all others had initiated cuts.

The lead Apple has built up in the market since April 2010 looks unassailable with distributors saying that demand for the iPad remains strong. "Whatever I can get I can sell straight away," said one authorised distie.

In fact, iPads are the only tablet devices that several large brokers expressed an interest in, as vendors seek alternatives routes to peddle their wares.

"There is a mountain of surplus tablets in the channel," said one, "and they are just not shifting."

This will add further pressure on system sales and distributors as resellers continue to try and clear massive stocks of notebooks caused by the biting slowdown in consumer demand. ®

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