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Motorola Offers Cheaper Xoom to Compete With IPad 2


Motorola Offers Cheaper Xoom to Compete With IPad 2

By Sandy Fitzgerald | Mon Oct 17, 2011 3:55 pm

Motorola plans to sell a new "family edition" of its Xoom tablet for $380, which may better position the device to compete with the higher priced iPad 2 as the holiday season nears.

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Motorola Xoom

Motorola Xoom

The entry-level Xoom, while marketed to children, only differs from the full-price version in terms of memory. The new Xoom has 16 gigabytes of memory, compared to the 32 gigabyte Xoom, which sells for $500.

Best Buy will carry the new Xoom exclusively, but says the price will eventually rise to $400. That price still undercuts the entry-level iPad's by $100, which may prove an attractivecut to anyone seeking a less-expensive tablet.

The Xoom was marketed earlier this year as competition for the iPad, with Motorola originally trying to sell its tablet in February at $800. However, the price was too high for the Xoom to compete with the lower-priced iPad, which went on to account for about three-quarters of all tablet sales, according to the Wall Street Journal.

By dropping the price, Motorola joins other tablet makers such as Research In Motion and Hewlett Packard, which both cut back price points to try to take business away from Apple.

Motorola chief executive Sanjay Jha in July said the company didn't price the Xoom aggressively enough, and it would begin selling new tablets at lower prices. However, even after dropping the Xoom's price several times, including introducing a Wi-Fi model for $600, Motorola has yet to come close to Apple's, causing the CEO to acknowledge in July that his company hadn't been aggressive enough in keeping down the Xoom's cost and would be rolling out new tablets that may compete better on price.

The price cuts may not be enough, though, to get buyers to switch from the best-selling iPad. RIM said last month many of the company's PlayBook tablets not being sold, despite lowering prices, and Motorola may face the same problem with Xoom, unless it can show the Android-powered tablet has features more attractive than the iPad's.


Posted In: Apple (134) | Featured (39) | Motorola (23)


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