Another Xoom Tablet Mistake From Motorola Mobility and Best Buy

 |  Includes: BBY, GOOG
by: Stephen Frankola

Once again, Motorola Mobility (NYSE:MMI) and Best Buy (NYSE:BBY) are leaking mixed, confusing, incorrect or incomplete information.

On Sunday, Engadget broke news that the Motorola Xoom would become available for preorder at Best Buy on February 17th, one week before the planned February 24th release date… for $1,199.99. This pricetag shocked and horrified observers; the tablet was supposedly going to retail for $800, which was already seen as pushing the limits of what many consumers might be willing to pay for a tablet.

Engadget quickly updated the story to note that sources stated that the listing shouldn't be trusted - rather, it was just a placeholder in Best Buy's system. The source also confirmed that $800 does seem to be the magic number for the Xoom's retail price when it goes on sale. A subsequent update noted that the listing has now disappeared permanently.

The damage to positive Xoom sentiment had been done, and mistakes like this are quickly eroding the enthusiasm that investors and consumers had for the Xoom. While I'm far from an Apple fanboy, it's easy to admit that they do a great job launching new products; they build up enthusiasm, usually limit leaks on product details, and then they formally present the new products to the world with details on specs, pricing, and availability. Motorola's Xoom launch has been the exact opposite - anxious consumers have had to deal with conflicting information on pricing ($800 vs. $1200), availability (2/24 vs. 2/17) and some feature details (whether the first Xoom requires a cellular data commitment). As a shareholder of MMI, I'm quickly losing confidence in management's ability to execute.

The Xoom initially seemed almost perfect. It was to be the first Honeycomb (NASDAQ:GOOG) tablet to market, it was beautifully designed (specifically, the slim bezel is exactly what many consumers have been asking for) and it was packed with high-performance innards. Now, the dream is becoming nightmarish... and any additional blunders by Motorola and/or retailers may exhaust the remaining enthusiasm for the Xoom. As a shareholder, I hope that the next ten days (remaining before the expected February 24th launch) can pass without any more mishaps.

Disclosure: I am long MMI.