RIM Updates Its BlackBerry Tablet

Research In Motion (NASDAQ:RIMM) has released a PlayBook tablet update that provides native email support for the first time in the device’s 10-month history. The PlayBook OS 2.0 upgrade also includes calendar and contact functions that were notably absent from the original version. However, the upgrade does not include the popular BlackBerry Messenger instant-messaging application, which remains unavailable for the tablet.

The PlayBook tablet launched in April 2011 and received harsh reviews due to what was lacking rather than what was present. BlackBerry devices have long been valued for enterprise use, and the PlayBook’s lack of email meant that business users had to either pay for a costly upgrade or tether the tablet to a BlackBerry smartphone. RIM promised an upgrade was forthcoming, but then failed to deliver for months on end.

Sales for the tablets were disappointing. RIM shipped half a million units the first quarter after Playbook’s release, but sales slumped to 150,000 units in the quarter preceding the winter holidays. RIM slashed prices to as low as $200 to spur holiday sales but was still forced to take a $485 million write-down on unshipped inventory.

The PlayBook upgrade announcement comes amid a rocky few months for RIM. The delayed release of the company’s new operating system, Blackberry 10, has raised concerns that it might suffer from functional blind spots similar to those that plagued the PlayBook. RIM has been struggling to show that it has the ability to stand on the same ground as Google (NASDAQ:GOOG) and Apple (NASDAQ:AAPL), maker of the iPhone, when it comes to rolling out operating-system upgrades that meet user needs and expectations.
Growing Android apps for BlackBerry

Google’s Android operating system for mobile devices is extremely popular, and RIM was hoping to steal some of Google’s thunder by inviting Android application developers to retool the apps for the BlackBerry App World. Developers were given a Feb. 6 approval deadline for apps included with the PlayBook upgrade. RIM boasted that BlackBerry-hosted applications would earn 40% more for their creators than apps sold through Google’s Android Market.

The company did make strides in making the conversion process easy for developers, but there were still major snags. RIM announced last year that BlackBerry applications would lack in-app purchase support, a revenue source that’s the lifeblood of social gaming powerhouse Zynga (NASDAQ:ZNGA). There was also a misunderstanding involving the ad display options of apps transferred from Android to BlackBerry. RIM declared that the apps could display ads built into the code but couldn’t support BlackBerry ad services. Limited monetization options may discourage developers of popular applications from making the transition to BlackBerry.

There’s a possibility that BlackBerry 10 will include improvements for application development. RIM has remained quiet about BlackBerry 10 details, though product photos leaked last week depicting a vastly changed user interface. Phones loaded with the new OS are expected to start shipping this fall, barring further delays.

Investors haven’t shown a great deal of confidence in RIM recently. Shares closed at $14.88—a weak stand compared to the 52-week high of $69.34. All that could begin to change for the better if future product launches, including that of the BlackBerry London smartphone, are successful, although RIM will need a string of solid successes before it can climb back up to its prior highs.

Sources: http://www.investorplace.com/2012/02/rim-updates-its-blackberry-tablet-rimm-goog-aapl/


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