After a bad week of botched interviews, critical reviews and a stock price that continues to drop, Research In Motion Ltd. hopes its fortunes will change next week, when consumers in North America finally get their hands on the company's first tablet.
Analysts and columnists showed at best mixed interest in the BlackBerry PlayBook this week, as RIM began showing it off to the public ahead of its April 19th launch date. Much of the criticism of the PlayBook centred on its lack of features - such as standalone e-mail and cellular connectivity, which are expected in an updated version this summer. In addition, some analysts worried that the device is too business-focused to become a consumer success story.
"As we recently wrote, with price parity with the iPad2, smaller form factor, and lacking ecosystem, we don't see a compelling consumer value proposition," UBS analysts wrote in a note Friday morning, the day after RIM held a launch party for the PlayBook in New York City. "RIMM may have better success selling to Enterprises where tethering the Playbook to a Blackberry phone could alleviate security concerns and the need for a separate data plan ... Increasing uptake of non-RIMM devices in Enterprise also poses a challenge."
RIM's stock price dropped to a five-month low on Thursday after a slew of critical PlayBook reviews hit newsstands. The stock is down more than 7 per cent so far this year, and suffered a particularly hard hit last month after the company reported weaker-than-expected guidance for this fiscal quarter. However the company's full year guidance was higher than the street predicted, as RIM hopes the PlayBook and a new line of smart phones will help boost sales during the remainder of 2011.
Next week will be an especially important one in the mobile device industry. Not only is RIM releasing its tablet on Tuesday, but Apple reports quarterly earnings for its fiscal second quarter the following day. Analysts likely won't get much information about how the company's second-generation iPad did, since the tablet only went on sale in the U.S. a couple of weeks before the end of the quarter. Still, the results should shed some light on the extent to which Apple can maintain its stranglehold on the tablet market.
Last year, Apple's original iPad accounted for about 90 per cent of all tablets sold, according to analysts. This year, as more and more companies release competing products, the iPad's market share is expected to drop to about 65 per cent, but the overall market is also expected to triple in size. According to research firm Gartner, Apple will continue to dominate the market until 2015, at which point it will be a two-horse race between the company's mobile computers and tablets powered by Google's Android operating system - at that point, Gartner expects RIM's tablets to place a distant third, with about 10 per cent of the market.