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Production of first Xoom model to end?

DigiTimes reports that Motorola Mobility will halt orders of the tablet at the end of June and potentially unveil a successor. Motorola denies the claim.

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Motorola's Xoom
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Update at 8:39 a.m. PT: Motorola Mobility denies the DigiTimes report and says it will not cease Xoom production after June.

Motorola Mobility plans to stop producing the Xoom by the end of June, a report claims.

Taiwan-based DigiTimes, which cited unnamed "upstream suppliers," reported yesterday that Motorola Mobility will meet its suppliers' forecast of ordering 700,000 to 800,000 Xoom units during the first quarter.

But over the next three months, the publication's sources say that Motorola Mobility will request fewer and fewer Xoom units. DigiTimes contends that the company will order 300,000 Xoom units next month, and a little less than that in May. It will finally cease production of the Xoom in June, the publication reported.

However, Motorola Mobility told CNET today that DigiTimes' claims are "not accurate" and that the company plans to continue producing the Xoom beyond June.

Motorola Mobility launched its Xoom tablet last month for $799.99 without a contract and $599.99 with a two-year commitment with Verizon Wireless. The device boasts a 10.1-inch display, 1GHz dual-core processor, and Android 3.0 Honeycomb. It comes with both a front- and rear-facing camera for video capture and conferencing. A Wi-Fi-only model will be available March 27 for $599.

Motorola Mobility hasn't commented on Xoom sales. But in a note to investors earlier this month, Jefferies analyst Peter Misek said he believes Xoom sales have been "underwhelming."

That stands in stark contrast to Apple's iPad 2, the Xoom's chief competitor. That device, which launched earlier this month, sold out in its first weekend of availability. According to Apple's Web site, online orders of the iPad 2 placed today won't be shipped for another four to five weeks.

To address the apparent discrepancy in popularity, Motorola Mobility could release a second-generation Xoom in the second half of the year, DigiTimes reported.

Including that second model, DigiTimes' sources predict that Motorola Mobility will ship a total of 3 million to 5 million Xoom units this year.