Is This RIM's Final Mistake?
After sorely overpricing its first tablet, it appears that Research In Motion (NAS: RIMM) isn't up to learning from its past mistakes.
MobileSyrup.com claims to have obtained an internal document from Canadian wireless carrier Bell that shows a new 4G LTE PlayBook launching next week.
The specs are impressive for a 7-inch tablet, especially the crisp resolution, potent dual-core processor, and best-of-class dual-camera quality. However, any potential excitement for the device dries up when the retail price in Canadian dollars of $549.95 -- or roughly $540 in U.S. currency -- comes out.
Yes, the cheapest 4G LTE Apple (NAS: AAPL) iPad is pricier at $630, but that's also a 10-inch tablet accompanied by Apple's brand and vibrant ecosystem. Consumers will be quick to compare the new PlayBook with the market-leading 7-inch tablets by Amazon.com (NAS: AMZN) and now Google (NAS: GOOG) that can be had for $200. Microsoft (NAS: MSFT) is obviously aiming to be competitive out of the box when its Surface tablet hits the market later this year.
The only saving grace for RIM here is if Bell will introduce steep subsidized pricing for its hometown hero. Bell offers up the Samsung Galaxy Tab 8.9 LTE for C$649.95 as a standalone purchase, but it's just C$299.95 tethered to a three-year contract. The same subsidized markdown would price the speedy new tablet in line with similarly sized Wi-Fi-based gadgets, though why would anyone choose the smaller BlackBerry tablet with iffy developer support over the Android-fueled Galaxy Tab for just a bit more?
Perhaps more importantly, who would be silly enough to get anchored down to the BlackBerry ecosystem for three years? RIM's fade has been swift and brutal. The dwindling faithful will argue that the company's upcoming BlackBerry operating system update will change everything, but momentum is hard to regain in mobile once it's gone.
RIM learned this the hard way last year, when it proudly rolled out the original PlayBook at ambitious iPad-esque price points. After the handful of early adopters bought in, the devices began collecting cobwebs until RIM slashed the price to as low as $200 late last year.
As bad as things may seem for RIM, it doesn't have a free pass to misprice its devices. Credibility -- and its very viability -- hang in the balance with every tablet or smartphone release at this point.
There's no denying that the next trillion-dollar revolutionwill be in mobile, and that's not just lip service. It's the name of a new free special report that you can check out now. However, no one seems to be inviting RIM to the revolution. On the flip side, the Fool recently issued a brand-new premium research report on a company actually leading the mobile revolution: Apple. (Sorry,RIMM.) Pick it up today.
The article Is This RIM's Final Mistake? originally appeared on Fool.com.The Motley Fool owns shares of Google, Apple, Microsoft, and Amazon.com.Motley Fool newsletter serviceshave recommended buying shares of Amazon.com, Apple, Microsoft, and Google and creating bull call spread positions in Apple and Microsoft. We Fools don't all hold the same opinions, but we all believe thatconsidering a diverse range of insightsmakes us better investors. Try any of our Foolish newsletter servicesfree for 30 days.Longtime Fool contributorRick Munarrizcalls them as he sees them. He owns no shares in any of the stocks in this story and is also part of theRule Breakersnewsletter research team, seeking out tomorrow's ultimate growth stocks a day early. The Motley Fool has adisclosure policy.
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