BlackBerry PlayBook Could Be In Trouble

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News Posted: Thu, Sep 29 2011 9:58 PM
Rumors circulate through the Internet faster than germs on an airplane, and a big one for today was that RIM may have stopped manufacturing the BlackBerry PlayBook. Reuters reported that an analyst with Collins Stewart made waves when he proclaimed that RIM halted production, citing factory layoffs at PlayBook manufacturer Quanta Computer and further unspecified “due diligence”.

RIM responded sharply to the rumors, indicating in no uncertain terms that the very idea was ludicrous and false.

However, given some other events of today and this week, it’s possible that the rumor has legs. RIM wouldn’t be the first company to deny a rumor that turned out to be true. (The phrase “Methinks thou dost protest too much” comes to mind.)

For one thing, the PlayBook was already struggling against stiff competition in the tablet space, and Amazon’s newly-announced Kindle Fire is likely to put another dent in the PlayBook’s sales. After HP’s hasty exit from the tablet market, it wouldn’t be a shocker to see RIM follow suit.

Further, the PlayBook’s price suddenly dropped; on Best Buy’s website, for example, the 16GB PlayBook now costs just $299--down from $499. (The Kindle Fire is slated to cost $199.)

RIM has also been hemorrhaging executives as of late, and the company lost another one today--Tyler Lessard, senior vice president for global alliances and developer relations. According to a Reuters report, senior vice president for platform marketing and alliances Jeff McDowell may have left recently as well. Losing so many high-level employees just doesn't bode well.

The company is also reportedly working on “superphones”, which may render the PlayBook irrelevant under RIM’s own roof. Thus, it would make sense to cut bait, liquidate the remaining inventory, and move on.

To that end, it’s also possible that RIM would want to sell off its remaining inventory and cease manufacturing new PlayBooks without saying anything about it, perhaps to prevent buyers from hesitating on dropping almost $300 on a tablet that they would worry wouldn’t be supported in the future.

(In HP’s case, it was a lot easier to move its discontinued TouchPads, as they were marked down to just $99.)

Perhaps this is all a bit of a stretch, a silly rumor ignited by a rogue analyst, but nothing about the news seems to point to anything particularly positive for the PlayBook. RIM will get a chance to quiet the rumors in a few weeks, when it’s scheduled to release a major software update for the beleaguered tablet.
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akumu replied on Thu, Sep 29 2011 11:15 PM

It was certainly a mistake for them to get into the tablet market. At this point it seems as though almost everyone is coming out with new tablets and they just dont seem to be able to compete with some of these larger companies.

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AKwyn replied on Fri, Sep 30 2011 12:07 AM

Well... RIM does have a bit of trouble with their Tablet but I wouldn't believe it unless the software upgrade they put out turns out to be disappointing.

I'll wait until it gets confirmed or not. This RIM tablet does seem to be trouble but they are putting their all in it.


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omegadraco replied on Fri, Sep 30 2011 11:33 AM

While I would agree that the Playbook has been in trouble from the get go. I wonder if they are cutting production of the Playbook to ramp up efforts for a second gen model Playbook 2.0 with all the problems fixed.

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JDiaz replied on Fri, Sep 30 2011 3:37 PM

A good possibility, rumors had been going in that direction before they cut production. Though the new pricing has yet to be wide spread and you have to watch out as some mix it up a bit to promote their own wares. Like Office Depot makes you get a store gift card instead of getting the full discounted price. Similarly Staples gives you a mail in rebate for a $100 debit card instead of giving you the full discount up front.

In my area only Best Buy and Office Max give the full discount up front and supplies are either back order or low for them.

While the 2.0 software update should fix many of the problems in the existing model, the ability to run Android apps appears pretty limited and RIM has yet to really flesh out its own App market.

They could also do with some better accessories... HDMI port works well for example but they don't have a dock that lets you easily connect it.

While the lack of a memory card reader means you rely on internal memory. So they should make it easier to browse network storage. Right now the file managers only let you browse internal memory and Blackberry Bridge if you have a Blackberry connected. So that needs to be expanded quite a bit as well.

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