Why Didn't Amazon Join the TouchPad Fire Sale?

The following post is based on pricing that was seen over the weekend directly through Amazon; the current prices on the site are reflective only of what Amazon's retail partners are charging. There are also reports that Amazon offered the TouchPad as a GoldBox deal, although that hasn't been confirmed at this time.

After HP killed the TouchPad, the company offered refunds to anyone who bought it, slashed the price to $100, and encouraged retail partners to do the same. Nearly all of them have. Except Amazon.

It's a strange situation, and one Amazon doesn't find itself in very often: offering a product for nearly three times the competition's price. Was it an oversight? Some lag in weekend paper-pushing? Maybe. Or maybe it's the absolute smartest thing a retailer can do when they're about to release a tablet of their own.

Think about it: what does Amazon gain by selling the TouchPad for $100? They put a cheap but capable webOS tablet in the hands of thousands of people just months before, reportedly, they're going to release their own cheap but capable Android tablet. They take a big chunk out of their market share at margins that, even if they're reimbursed by HP, are narrow at best.

Why Didn't Amazon Join the TouchPad Fire Sale?

So what do you do instead? Keep selling the TouchPad at discounted, but not bargain basement, pricing. Sponsor the HP TouchPad keyword on Google, so you can reinforce that $230/$330 floor; that way when your tablet costs that much or a little more the non-technified masses won't wonder why it's not a benjamin. And make a little money off of the few people who haven't heard the news.

File this all under rampant speculation, of course; there's every chance those keywords were bought months ago. But the Amazon tablet was all but confirmed by CEO Jeff Bezos himself, and it's expected to be here in no more than a month or two. So when Amazon doesn't pitch in with Target and Costco and everyone else to degrade the tablet market, it's a safe bet that it's not an oversight. It's not because they think the TouchPad's actually worth more. It's they don't want to be dragged down by HP's sinking ship.