Best Buy takes XOOM preorders -- get yours for (gasp) $800, not $600

Best Buy XOOM ad

So much for the $600 WiFi-only Motorola XOOM tablet, gadget geeks pine for. While Moto may have promised the lower-cost model, there are no signs it's coming this week. Best Buy has started taking preorders for the 3G/4G/WiFi model for (cough, cough) $799.99, available February 24 -- that is based on earlier leaked information. The higher-cost XOOM requires (cough, cough) Verizon cellular contract and (cough, cough) one month's service required to turn on WiFi capabilities.

Can you say price gouging? Best Buy isn't taking preorders online. Shoppers must go to stores to cough up 800 bucks. Here, in California, applying 9.95 percent tax puts the price at nearly $880 out the door.

When the $800 price leaked out earlier this month, Betanews readers scowled at the cost and required one-month Verizon service to activate WiFi. Verizon is notorious for disabling hardware features, like Bluetooth, on some handsets.

XOOM is among the hottest Android 3.0 (aka Honeycomb) tablets announced this year. The Moto tablet weighs 1.5 pounds and measures half an inch thick. Other features: 1GHz dual-core nVidia Tegra 2 processor; 10.1-inch display with 1280 x 800 resolution; 1GB of RAM; 32GB internal storage, expandable with MicroSD card; 5-megapixel back-facing and 2-megapixel front-facing cameras; 720p video recording; 1080p video playback; HDMI and USB 2.0 ports; accelerometer; barometer; and gyroscope.

But for all users get, there's tremendous sticker shock, particularly compared to iPad, which entry price is $499. Betanews reader Mark Byrn astutely puts the competitive problem in even bigger perspective. He writes via email: "Joe, one thing you've missed is the absurdity of the price difference between the WiFi-only version and the XOOM with 3G/future 4G radios. Consider that Apple adds $130 for it's 3G version -- ridiculous for a part that costs maybe $20 -- and here we got Motorola charging $200 for 3G/4G?"

He continues: "I got a 4G iSpot from Clear for $25 and no contract. Motorola should be undercutting Apple by more than half here in all respects...the iPad is already overpriced and people are looking for better alternatives that don't involve paying the Apple tax."

He's preaching to the choir, as they say. Last week I griped about how carrier contractual commitments push up Android tablet pricing compared to iPad. What's surprising about the $800 3G/4G radio XOOM price: It's unsubsidized. Verizon isn't giving buyers a break, and it's still demanding they pay for a data contract.

"If you recall your history, Widows PCs buried Mac computers into niche status because of price (you got more for less), and if Motorola and other Android tablet makers aren't offering comparable platforms at a significantly lower prices than Apple's overpriced 'magic', they're smoking some bad weed," Byrn writes.

He then scolds me: "Instead of taking sides for or against the companies, please take sides with the consumer; you should be blasting Motorola and Samsung for duplicating Apple's 'premium profit' model, and if tablets are going to succeed with the masses (not just the loyal Apple Kool-Aid drinkers), the prices have got to come down to reality."

This post is what you asked for, Mark. I've done four previous XOOM pricing stories without offering my personal opinion. XOOM costs too much at $800 and even $600. Motorola's priority should be gaining market share, by offering pricing below iPad, which would benefit consumers. Apple has first-to-market advantage in a resurgent category. More importantly, more than 85 tablets are queuing up to compete with iPad. Moto should seek to get in front of other tablet competitors, even if it initially loses money to gain market share.

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