Dell Kills Streak 7, Bails On Android Tablets

An anonymous reader writes with this news from Network World: "Dell has yanked the Dell Streak 7 tablet computer from its online stores, quietly acknowledging the failure of the Android device to catch on with consumers as the company redirects its tablet focus to combination work/play products. Word of the Streak 7's disappearance follows by a few months the death of the Streak 5, which debuted in summer 2010. The dual-core processor-powered Dell Streak 7 became available in January, marketed as a 4G wireless tablet via T-Mobile's network. Now Dell is directing would-be Streak buyers to Android and Windows Phone smartphones, and pushing a line of Windows Phone tablets for business."

Comments

Nope

[Hotweed Music]

http://www.theverge.com/2011/12/5/2612610/dell-were-not-backing-away-from-android

Re:It's high stakes poker

[blibbler]

Are you kidding? Some are predicting the Kindle fire to sell 3.9 million this quarter http://recombu.com/news/amazons-kindle-fire-sales-second-place-to-ipad-set-to-vaporise-other-android-tab-sales_M15995.html, and others are predicting Apple to sell in the order of 13 million iPads http://articles.businessinsider.com/2011-11-28/tech/30449262_1_ipads-piper-jaffray-apple-stores .100,000 Xooms is less than a rounding error. To put it in perspective, Windows mobile 7 has more of the phone market than any of the non-kindle android tablets have of the tablet market.

Re:Revenue model

[tlhIngan]

Well, this pretty much indicates that, at least when it comes to tablets, you cannot make money off of the hardware alone. iPad is still the exception, because it literally defined the market. However, Apple makes so much money off of the App store that they could undoubtedly sell the hardware at a loss and still profit overall. They just don't need to - at least not at this point.

Amazon's Kindle Fire is the only real competition, the reason being that Amazon is an established content provider, and just like Apple, they have their own closed App marketplace that they also profit off of. How can Dell, HP, Motorola, HTC compete in this scenario, when the only thing they can make money off of is the hardware? Their only chance is to partner with someone who does have the content distribution infrastructure, but it seems that chance has already passed.

Apple's revenues from iTunes is far lower than the revenues from the hardware. Apple simply does not run iTunes for huge profits, and if it wasn't to sell hardware, would promptly abandon it.

I mean, 30% revenue means less than 30% profit margin after expenses (servers, hosting free content, iCloud, payment processing, etc). I think Apple only took around $1.5B profit from iTunes, and that includes apps, music, books and movies.

I believe the device (iPod, iOS) profit was 20 times that in the same period. Even Mac profit was an order of magnitude higher. than that. It's all in the Apple revenue filings. iTunes just doesn't make more than pocket change for Apple. There's not much of a loss Apple can take on hardware to be made up through iTunes.

Amazon's selling hardware to sell content. Apple's selling content in order to sell hardware (has been true since 2003 when the iTunes Music Store opened). The two can't have more opposite business models. (And Google's offering stuff for free to sell ads). You can see it in the device breakdowns - Apple's hardware really only costs $300 or less to make, while Amazon's basically selling at cost.

And HTC, Samsung, LG, etc seem to be doing fine selling hardware, as does Apple.

The only thing Apple and Amazon have in common is they sell "the whole experience" - devices with the ability to get content easily. Why they offer content may vary, but they know if they make it convenient, people will buy (it's how iTunes became the dominant force in music sales) and gives a lot of legitimacy to the stuff. (People back then accused Apple of enabling music piracy - Apple proved the music industry was Doing It Wrong(tm)).

The other content with hardware guys in the game are Barnes and Noble and Kobo. I don't think the Nook Color is sold at a loss given how B&N seems to let that tablet be hacked trivially.

And nevermind the "success" of such greats like RIM (Blackberry App World), HP (remember WebOS? They had an app store?) who also mixed the hardware-with-content offerings.

tl;dr - Apple doesn't make much money off iTunes - see their last earnings report and hardware sales consistently outdo iTunes sales by wide margins.

Way back when

[ISoldat53]

Dell had the best tech support. It was what differentiated Dell from the rest. Then Dell hired a management consulting firm to come in and see if there was a way they could improve the business. The consultant's advice was to be more like Gateway Computers and cut back on support. The result went straight to the bottom line and the stock price shot up and management and everybody made fortunes. Anybody with a clue saw what was happening and sold out. The stock price has never recovered and you know what Dell's reputation is like.