I can't imagine what Motorola/Verizon were thinking. They're not going to sell more than a few of these without lowering the price drastically.
Edit: Oops, I misread the ad as saying it had 16GB storage. The more reasonable price comparison is then the 32GB iPad, which is $730. More reasonable, but still too much (especially given that you must sign up for a very expensive data plan to even use WiFi).