HP TouchPads At Peril: 200,000 Unsold Stocks Sits in Best Buy

The surplus stock of over 200,000 unsold TouchPads are sitting in Best Buy, waiting to have HP bring them home.

Hewlett Packard's touchpad tablets have lagged behind the high expectations, and its poor sales in the U.S. retail stores has already reduced their prices for $100. Even with the discount, Best Buy has sold at most 25,000 out of 270,000stocks.

The retailer is now asking HP to take back the unsold tablets. HP is pleading with Best Buy to be patient, and a senior executive is reportedly scheduled to travel to Minneapolis soon to meet Best Buy executives.

HP is set to report quarterly earnings Wednesday, and it may be the case that HP opts not to disclose unit sales results for the TouchPad.

One analyst, Avi Greengart with Current Analysis, said the price cut was a good move for HP and could heal some earlier wounds the company brought on itself. For one, the original tablet came out with a lot of bugs and because of that, HP paid with terrible reviews. Secondly, a lot of other reviewers said the device was priced too high.

"I do think the price drop was necessary, as HP clearly wasn't getting the volume sales it needed at $499. HP's webOS offers superior multitasking, but user interface simply is not a pain point for iPad users, and the TouchPad lacks the iPad's apps, content, and slimmer, lighter form factor," Greengart said.

In cutting the price, HP may be admitting the original price was too high. Other tablets, like Motorola's Xoom and Samsung's Galaxy Tab, have seen price cuts in their cycle, but none have been as quick to do it as HP.

The only hope for WebOS is if HP licenses it to phone makers currently trapped between Google-Motorola and Microsoft-Nokia, said Matt Rosoff of Business Insider.

Initially, TouchPad was touted to be an iPad 2 killer, and webOS was highly anticipated to become the third platform.

However, HP's hopes of renaissance to become an end-to-end device maker like Apple - which controls the entire cycle of the development of its OS and device - will have to wait for the next hit.