Motorola Report Reveals Terrible Xoom Sales

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News Posted: Mon, Aug 1 2011 2:56 PM
Prior to its launch, Motorola's Xoom tablet was touted as the first of the iPad killers, with features and capabilities the iPad lacked as well as a brand-new version of Android codenamed Honeycomb. Once the tablet hit shelves, it was clear that Motorola had rushed production in a bid to beat the iPad 2 to market. At launch, the Xoom's Wi-Fi variant was nowhere in sight, Flash support (a much-touted feature) was absent, the advertised 4G upgrade capability wasn't scheduled to appear before September, and the microSD slot didn't actually work. Google later came out and admitted that it had rushed Android 3.0 specifically for the Xoom's launch and that as a result, Honeycomb's source code would be kept under wraps.

According to the company's Q2 results, it shipped just 440,000 Xoom tablets over the past three months. Actual sales numbers could be even worse; reporting devices shipped equates to the number of Xoom tablets Motorola sent retailers, not the number of tablets said retailers actually sold. The Xoom was widely panned for its whopping $799 initial price, a fact that company executives acknowledged as a mistake.  "We now recognize where the price points are. For the fourth quarter we'll launch very good, new tablets and we'll have a good quarter," Motorola’s Chief Executive officer Sanjay Jha stated. The Wi-Fi version of the Xoom later launched at $499, but the initial $799 for the 3G-enabled version may have helped paint the tablet as overly expensive in the eyes of consumers.


Ow.

Overall revenues grew significantly (up 28 percent from Q2 2010), and the company launched multiple new devices in regions around the world. The company's guidance focused heavily on mobile products like Droid X2, Droid 3, and the Motorola Photon, with Xoom relegated to a single statement that the tablet would be introduced (along with the Atrix) into Latin America. Motorola's phone business shipped some 10.5M mobile devices over Q2, but just 4.4M were smartphones. That's nearly half again as many as the company sold in Q2 2010, but Apple moved in excess of 20 million iPhones.

The Xoom, in the end, turned out to be its own worst enemy, and failed to grab much in the way of consumer demand even before the iPad 2 had hit the market. Motorola's decision to focus on smartphones has paid off where the Droid line of products is concerned, but after years of trying to own the 'dumbphone' industry, it may take time for the company to reestablish itself as a top-tier competitior.
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