HP Readies Tablet But Analysts Warn Of Challenges

HP is about to enter the tablet fray with the 9 February launch of its webOS TouchPad tablet computer.

However HP’s past failures in making new consumer electronics products fly in the market, has some analysts sceptical about the device’s viability.

HP’s TouchPad, as many are calling it, will be swimming with Apple’s market-defining iPad and machines based on Google’s Android 3.0 Honeycomb operating system, such as the Motorola Xoom. Even RIM’s PlayBook has cultivated mindshare, with some enterprise-minded buyers eager to tether a tablet to their Blackberry smartphones.

Event Launch

Except for comments from HP Executive Vice President Todd Bradley all but confirming the webOS tablet is launching during the HP event in San Francisco 9 February, HP has officially kept mum on the device.

However, several leaks indicate the TouchPad should be a 9.7-inch tablet powered by a 1.2GHz processor. The TouchPad would appear first in WiFi-only on March, with 3G/4G version following later.

Despite the fact that HP has been selling its Windows 7-based Slate for corporate users, Caris & Company analyst Robert Cihra believes the company’s tablet strategy is 99 percent focused on webOS as HP angles to leverage assets culled from its $1.2 billion (£746 million) acquisition of Palm.

However, excepting Wintel PCs and printers, HP has a poor track record entering new consumer electronics markets, said Cihra. He pointed to unsuccessful attempts in MP3 players, TVs and handhelds.

“We see even bigger stakes and challenges in tablets/smartphones where in-house software is key,” Cihra said in a 4 February research note. “Yes, Palm brought its very well-regarded webOS and engineers, but not much market momentum.”

Hard Job Ahead

“On the one hand we’re encouraged to see at least try to field its own value-added platform, rather than just a me-too Android box, we remain sceptical HP can convince consumers and developers that webOS is even relevant.”

Even though Cihra expects 54 million tablets shipping in 2011, 36 million of those devices will be iPads.

Ultimately, HP is in a tough position to compete with the Xoom launching this month, the iPad 2 and PlayBook expected to launch in March, as well as the Toshiba tablet, LG G-Slate and other Android tablets coming later this spring.

Meanhwile, J.P. Morgan analyst Mark Moskowitz sees other challenges for the webOS tablet, namely that any application ecosystem for the device remains an unknown quantity at a time when Apple’s App Store and Google’s Android Market are guiding those tablets.

The risk, Moskowitz said, is that HP introduces a fine device with a strong OS, but doesn’t have the apps and content to lure users.

Stay tuned for the launch.