MOUNTAIN VIEW, Calif.--The Blackberry Playbook has seen yet another price cut, as Research in Motion Inc. (RIM) tries to sell off its remaining stock in the face of fierce competition from its rival and twin, the Amazon Kindle Fire.
The ill-fated PlayBook has seen continuous devaluation since its lowest specced version appeared on the market for $499 back in spring of 2011. That price steadily dropped as RIM shipped less than 500,000 in its first quarter on the market, 200,000 in its second quarter and just 150,000 in the last quarter.
Back in December 2011, RIM admitted it would be taking a $485 million write-down to rid itself of PlayBook inventory at huge discounts.
During the run-up to the holidays, RIM discounted its 16 GB version to $199, but even that did not manage to stave off the stiff competition, even from its almost identical tablet twin, the Amazon Kindle Fire.
Indeed, Amazon’s Android tablet is not just similar to the PlayBook, it uses an almost identical design and is made by Quanta, the same contractor manufacturer that makes the PlayBook. Amazon apparently went the copy-cat route in order to hurry up production and have the Fire released in time for the holiday season, though the firm is reported to have had to make some compromises, like opting for a cheaper, slower processor.
Taiwanese manufacturer Quanta seemed like a good fit for Amazon, as the Seattle e-tailer fended to stave of its own nemesis in the space, the Nook Color.
Upon realizing that its own hardware team at Lab 126 would not be able to put out a tablet in such a short time frame, Amazon turned to Quanta, which already had the hardware template for RIM’s PlayBook on hand.
Amazon’s price tag, too, is identical to RIM’s newly discounted price, but Amazon has a sturdy retail business model to back up selling its hardware at below cost, whereas RIM does not.
A report by IHS iSuppli put the PlayBook’s BOM (bill of materials) at $271. RIM purportedly still has 1.79 million unsold and unshipped PlayBooks in its warehouses.
In January, RIM tried the odd strategy of trying to sell all of its PlayBook models, the 16GB, 32GB and 64GB version, at $299\. When that failed, the firm shuffled prices again.
Currently, on the The Blackberry online store, the 16 GB version has been restored to the $199 price point, while the 32GB version stands at $249 and the 64GB version is $299.
RIM’s long awaited Blackberry Playbook 2.0 software update with support for Android apps is scheduled for release later this month.
Meanwhile, RIM also briefly held an employee fire sale back in November, trying to shift units for $99, a price point many analysts feel would be more apt in the current climate in order to sell off RIM’s Plabook stock, the same way HP rid itself of TouchPads last summer.