Don't forget $99/year developer program. That's would offset quite a few app sales as well.
I, along with many others, derided the $499 price point, and called it stupid. $99 is fantastic, but they've obviously decided against making it a long term viable business for them.
Despite what many others said, I strongly believe these would have sold well at $249-$299, and could have enabled HP to make a play to be a strong outside third, and then possibly a second, in the tablet space.
I hope that's the case, though, bcse I still love Palm, and would love to see WebOS succeed.