Motorola Mobility's WiFi-Only Xoom - Price Tag Confirmed at $600

Feb.16.11 | About: Alphabet Inc. (GOOG)

On Wednesday, Motorola Mobility's (NYSE:MMI) CEO Sanjay Jha confirmed exactly what shareholders and consumers had been dreaming of: A WiFi-only Xoom tablet will be sold, and it will only cost "around" $600. He also confirmed that the 3G/4G version will be sold for $799, which matched the expectation based on some leaked Best Buy (NYSE:BBY) advertisements. Engadget's write up of this news presents the same information, but the comments on the article manifest the immense relief and enthusiasm of tech consumers after hearing confirmation of these prices and details.

The WiFi Xoom's existence and price should help Motorola capture many customers who may have otherwise waited for another Android tablet or the iPad 2 from Apple (NASDAQ:AAPL). The $600 price tag matches that of the 32GB iPad, eliminating any hesitation consumers may have had based on price. The 3G/4G Xoom is a bit more expensive than the 32GB/3G iPad, but the Xoom is a technologically-superior device (and savvy consumers will be conscious of the extra performance they're getting for their extra $70). The Xoom definitely won't appeal to every tablet-hungry consumer; many may be loyal to Apple products or be waiting for another Android (Google - (NASDAQ:GOOG)), WebOS from HP (NYSE:HPQ) or Windows 7/Microsoft (NASDAQ:MSFT) tablet. However, the Xoom's features, prices and release date should be attractive to a significant number of prospective buyers.

Wednesday's news seemed to reassure MMI shareholders that the Xoom has a great chance to launch successfully and become an important brand in the growing tablet market. Shares were up 4.5% today following the news release.

The next major piece of information that may move MMI shares will be initial sales information and results. The Xoom's release date at Best Buy seems to be February 24th, though a screenshot of a Best Buy page seemed to indicate that they may begin accepting pre-orders possibly as early as tomorrow. Once the launch date becomes official and occurs, sales data will indicate whether the Xoom is a serious iPad competitor of if Motorola didn't do a good enough job appetizing tech consumers with its first tablet. I doubled-down on my MMI position during Tuesday's dip, so I'm hoping that the former outcome is what occurs.

Disclosure: I am long MMI.