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dailyvideo

The PlayBook is killing RIM

Gizmodo
RIM finally eked out a decent quarter. Beat analyst estimates, even. That is, if you don't count the $485 million bath the company took on unsold tablets. The PlayBook — ill conceived, poorly executed — is RIM's worst product. And it might just take down the whole company.
It's been a trying year for RIM. There have been security snafus and subpar product launches and an overwhelming sense of stagnation. All of which is compounded by the company's blind hubris, be it last year'sridiculous BlackBerry Torch expectations or today's claim by co-CEO Mike Lazardis that every day he "[hears] stories ... about people saying the BlackBerry Bold is the best communication device in the world today." If those are the stories you're hearing, maybe you're spending too much time in the fiction aisle.
But despite all of the miscues, no matter how many blinders management has on, RIM has still managed to be profitable. Its subscription base hit 75 million this year. It pulls in a billion in cloud revenue on the regular. You'd be tempted to say that RIM was succeeding in spite of itself—if it weren't for its greatest failure. The PlayBook: it's RIM's Gilligan, albatross, and giant self-destruct button all rolled into one. It could be the death of them.
Remember: by all rights there shouldn't even be a PlayBook, and there wouldn't have been were it not for the iPad. And while RIM's certainly not the only Apple competitor caught with its pants down, it was the one with the most to lose. Samsung, Toshiba, Lenovo; they were on the hook for hardware, sure, but they could bunk comfortably on the USS Android. And more importantly, they could crank out consumer-focused iPad clones.
RIM, though? RIM had to make an enterprise tablet. You know, that thing that no one needs or wants. It had to go it alone. And it got it so very, very wrong. No native email or calendar at launch, no BBM. And when you screw it up that badly, all you're left with is a $485 million answer to a question no one was asking.
But here's the part that might break your heart: RIM still doesn't get it. Today its managers said repeatedly that they believed in the PlayBook because people had finally started buying it — as part of a two-for-one sale. Or at $100 a pop for its own employees. You know, the kinds of prices where RIM loses massive amounts of money on every sale.
The excuses were ample. The tablet market, said Lazardis, is still "in its infancy." Really? Apple sold more than twice as many iPads as Macs last quarter. Just because you've entered a baby in the race doesn't mean you're not competing against grown-ass men. But PlayBook 2.0 software, RIM said, will drive sales next February. Really? All native email means is that people who hate their PlayBooks now will hate them slightly less in a couple of months. It's not a selling point, it's table stakes. An ante that RIM's gone nearly a whole year without ponying up.
So $485 million is a lot of money, money RIM can't afford to eat every few months. But there are other costs that don't show up on the bottom line. Reputation takes a hit, sure. But so does productivity. RIM's other major letdown of the day was that BlackBerry 10 handsets would be delayed until late 2012. You think that would have happened if some of the company's best minds weren't giving CPR to its DOA tablet these last few months?
Lazardis' argument is that because PlayBook and BlackBerry 10 share QNX roots, developing for one is the same as developing for both. That's false. The iPad and iPhone are both iOS devices, but they each require separate — and substantial — resources to develop, hardware and software alike. Right now the PlayBook is a leech, sucking up the lifeblood that RIM could and should be using to make great phones again. And to make them quickly.
 
Next year, RIM's big PlayBook fix is to spend lots and lots of money on advertising and marketing. In fact, it's already started, right here on today's press release:
A conference call and live webcast will be held beginning at 5 pm ET, September 15, 2011, which can be accessed by dialing 1-877-974-0445 (North America), (+1)416-644-3414 (outside North America) or through your personal computer or BlackBerry® PlayBook™ tablet at www.rim.com/investors/events/index.shtml.
Emphasis added, but implicit. Also: this was desperate enough to make me legitimately sad.
You can only throw so much good money after bad. Because eventually, you end up with nothing but a warehouse full of tablets, and a faded memory of a company that used to be pretty damn special.
More on RIM from Gizmodo:
sorce: http://technolog.msnbc.msn.com/

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