PlayBook Tablet PC Price Cut as RIM Stock Plummets

Dennis Faas's picture

Even after trimming thousands of jobs, it appears Research in Motion (RIM) is still unfit to compete with the likes of Apple. Late last week its stock value plunged nearly 20 per cent after a recent earnings report led to disappointment amongst investors.

"RIM is on a path to becoming a niche player," said Forrester Research analyst, Ted Schadler. "RIM has to essentially retrench its strategy. It has to focus on what about its products make them different or better than Apple or Google products." (Source: businessweek.com)

It would be irrational to assume that management at Research in Motion has been doing anything but racking its brains in an attempt to figure out just what made the original BlackBerry successful, and why more recent strategies -- be it in the smartphone or tablet markets -- have failed so miserably.

RIM Stock Value, Revenue Plummets

The list of failures is a long one, highlighted no doubt by the PlayBook tablet computer, which after modest opening sales has fallen completely flat in recent months. Follow that up with new but entirely unexciting releases for updated versions of the BlackBerry and you have the recipe for financial disaster.

According to RIM itself, its profits for the second quarter fiscal fell to about 80 cents per share. That's 8 cents per share lower than what analysts predicted. It's all a result of plummeting revenue, which fell to $4.17 billion in the three months leading up to August 27. That's compared to average estimates of $4.47 billion.

As a result, analysts have reduced their own ratings of RIM stock, making the likelihood of a recovery even less probable.

RIM PlayBook: Firesale Ahead?

There are now rumors that RIM will soon begin a TouchPad-like firesale of its PlayBook tablet. Last week the Waterloo-based company drastically reduced the price of PlayBooks for its employees (up to 50 per cent off retail value).

Analysts believe that in order to revive interest in the device, as well as the company's other wares, the PlayBook could get a huge price reduction in the coming months. For the time being, this only remains a rumor -- but certainly something must be done to save the PlayBook (and even BlackBerry) from disaster. (Source: pcmag.com)

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