hwy120

Is RIM PlayBook Dead or Just Deeply Discounted?

"RIM as a Titanic has hit its iceberg" with the PlayBook," said Rob Enderle, principal analyst at Enderle Group. "It's sinking and now they are trying to figure out how best to abandon ship. That's the difficulty they are in. They are not sure if they should be in or out. RIM is a firm in search of a strategy" for the PlayBook Is Research In Motion planning to take the Hewlett-Packard route in the tablet  market? Maybe. According to one analyst report, RIM is putting the kibosh on the PlayBook. But RIM denies it.
The report by analyst John Vinh of Collins Stewart emerged just two days after RIM's PlayBooks started showing up on sale at retailers for $200 off the launch price -- and the day after Amazon rolled out its Kindle Fire for a meager $199.

"While Quanta last week acknowledged that it had laid off a significant number of production workers from a factory focused on producing the PlayBook, our research indicates that the [original design manufacturer] has essentially halted production of the tablet," Vinh wrote in a published note to investors Thursday morning. "Additionally, our due diligence indicates that RIM has canceled development of additional tablet projects."

Fewer Than 1 Million Sold

RIM was not immediately available for comment. But RIM spokeswoman Marisa Conway issued a statement denying Vinh's assertion.

"Rumors suggesting that the BlackBerry PlayBook is being discontinued are pure fiction," Conway said. "RIM remains highly committed to the tablet market and the future of QNX in its platform."

RIM says it shipped 500,000 PlayBooks in the last six weeks of its fiscal first quarter. That's on top of 200,000 PlayBooks shipped in the second quarter. Still, the PlayBook has had bets against it since before it entered the market.

"RIM as a Titanic has hit its iceberg. It's sinking and now they are trying to figure out how best to abandon ship. That's the difficulty they are in," said Rob Enderle, principal analyst at Enderle Group. "They are not sure if they should be in or out. RIM is a firm in search of a strategy."

Searching for Strategy

The PlayBook went on sale April 19 with at $499 for the 32 GB model. But it debuted with fundamental features missing, including a contacts database , a calendar, a chat application  and a 3G  or 4G  connection, not to mention native email. Users who want those features must tether their PlayBook to a BlackBerry -- if they have a BlackBerry. The PlayBook only makes available 3,000 applications, compared with Apple iPad 's more than 160,000.

The PlayBook is a 7-inch touchscreen  tablet with features like web browsing, multitasking, high-performance multimedia, enhanced security , enterprise  support  and a new development platform for IT  departments and developers.

The PlayBook is less than a half-inch thick and weighs less than a pound. It features a 1 GHz dual-core processor , 1 GB RAM, dual HD  cameras, video and audio playback, HDMI video output, both Wi-Fi  and Bluetooth and application support for a range of software .

"Combined with the BlackBerry it is actually a better solution than the iPhone and the iPad are together. But RIM has to figure out a way to market that as an advantage," Enderle said. "Right now it's being perceived as a disadvantage and the product is getting killed at market.

"So at the end of the day, the fix for RIM is they have to figure out what they want to do and they have to start doing it well. Until they do that, they are on a going-out-of-business  strategy and buyers are going to flee the product."