RIM Altering Its PlayBook Strategy, Willing to Give This Low Cost Tablet Thing a Second Look

Paul Lilly

Research In Motion grossly underestimated what a big deal it would be to release a tablet with what some consider critical missing features, namely native email, calendar, and contacts support. The PlayBook was met with mixed reviews; some were willing to overlook the PlayBook's failings, others decided not to pull any punches in their criticisms. Give RIM credit though, the powers in charge stuck it out, and regarding that fire sale over Black Friday, it appears to be a sign of things to come rather than a declaration that RIM wants out.

RIM on Friday said it would record a pre-tax provision in the third quarter of fiscal 2012 of approximately $468 million, or $360 million after tax, related to its inventory valuation of PlayBook tablets. And don't worry, RIM says it's sitting on a "high level of BlackBerry PlayBook inventory," and even better is the fact that RIM appears to recognizie the market shift that's taking place thanks to the recent launches of Amazon's Kindle Fire and Barnes & Noble's Nook Tablet, two comparatively low-cost slates in what was previously a sea of $400 and $500+ tablets.

"The Company now believes that an increase in promotional activity is required to drive sell-through to end customers," RIM said in a statement . "This is due to several factors, including recent shifts in the competitive dynamics of the tablet market and a delay in the release of the PlayBook OS 2.0 software."

Recent promotions saw the previously $500 PlayBook tablet marked down to as low as $199 or less, and it's still selling for that price a full week past Black Friday and well after Cyber Monday. Whether it stays at $199 or not is anyone's guess (RIM's online store says the sale ends on December 3), but RIM did say it's planning to "expand upon the aggressive level of promotional activity."  If the price stays this low, the PlayBook becomes an interesting value proposition, especially with a major software update now scheduled for February 2012.

Image Credit: Research In Motion

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