RIM Playbook: Do You Really Care? Really?

Research In Motion (Nasdaq: RIMM  ) teased its new Playbook a few days ago and it looks good on paper, but I have yet to find anyone that actually wants one. A number of folks think it looks like a good product and, I agree, it has potential. But what's the point if no one really wants to buy it? Is this because Apple (Nasdaq: AAPL  ) does such a good job of setting the bar, and alternative products just don't seem to carry much interest?

I want an iPod!
Ever since the iPod launched, I've heard a number of stories from parents who were convinced by sales people that another MP3 player was better. Microsoft's (Nasdaq: MSFT  ) Zunes, at least the second and third generation products, were as good or better on spec, for instance, but when they gave their child the non-iPod product, they often were greeted by tears and disappointment, because the child had asked for and wanted an iPod, and nothing else would do.

Better is something that exists as a perception. What I or you think is better doesn't matter if the person we want to impress with a gift doesn't agree. This is largely how Apple got to own more than 80% of the MP3 market. People came to believe that nothing else but an iPod would do, and from developers to accessory providers, the result was an ecosystem that is unmatched in the segment. The belief eventually turned into reality. Today, there is no MP3 player, from the standpoint of total solution, that is better than an iPod.

iPad Halo
The iPad is starting out like the iPod did. It doesn't have an insurmountable lead yet. However, it already has a reputation for being near magical in its capabilities. The only other product that seems to have anywhere near the level of reputation in a related class of product from another vendor is the Kindle, and even though both products are restrained by manufacturing limitations at the moment, you can see a hefty accessory and application ecosystem growing up around the iPad that no Kindle currently shares.

The result is that, when it comes to tablets, people are rapidly locking down on the idea of the iPad, much like they did on the iPod, as the prefect tablet and, if the majority of the buying public does this, it is unlikely any other product -- no matter how well-built or provisioned -- will be able to take the leadership that the iPad created.

Closing Window
However, the iPad is leading largely by perception at the moment, and Apple is doing a good job hiding, much like they did with the initial iPod, the initial iPad's limitations. These include the inability to use the product outside (something the Kindle is successfully marketing against), relatively few accessories, and relatively (compared to the iPhone and iPod touch) few killer applications. In addition, the device currently lacks cameras, the related 3G services won't allow video, and docking only works in portrait mode rather than the preferred landscape mode, if you want a physical connection. Oh, and the product costs about twice what it eventually will once it becomes cost optimized. Recall the initial iPod? It had no video, held 5 GB, and cost nearly the same as the iPad. The second generation of the iPad will likely address many, if not most of these shortcomings, so this vulnerability won't last forever, but while it does, Apple does have an exposure.

RIM Playbook Opportunity
So the RIM PlayBook, which is more portable, has a lower price, has twin cameras, has better connectivity to the web, better video wireless capability, and native Flash support, and it is largely designed to do well in many of the disciplines the iPad does poorly. However, all these things make little difference if people hold up the iPad as the bar and penalize the PlayBook for why it is different rather than credit it with why it is better.

To do the latter, RIM has to market at Apple's levels, and while RIM has created a compelling piece of hardware -- it even tethers making better use of a smartphone's existing data plan -- RIM has never demonstrated a capability to position itself competitively well against an Apple product.

Their latest phone, the BlackBerry Torch, tried and failed to be perceived as an iPhone killer. By trying to position that phone against the iPhone, RIM strengthened Apple's case, because it helped Apple set the iPhone as the bar and the Torch is simply no iPhone. It has a number of differences that could be advantages, but not if people see the iPhone as the gold standard. RIM, in the way it spoke about the Torch, played right into Apple's hand.

The Apple Competitor's Dilemma
RIM has what could be a winning alternative to the iPad, but only if it is seen for its relative strengths and not its relative differences to the gold-standard iPad.

Like most Apple competitors, by constantly bringing up the Apple products and positioning itself against the same set of multi-media based use cases that define Apple's offerings, RIM simply looks lame. Only the Verizon Droid has done a good job of having people look at the iPhone differently, and much like it is in a political fight against an incumbent, the Droid has stood out as one of the few Apple competitive successes.

If RIM and others (the well-differentiated Windows Phone 7 products will be arriving shortly) can't rise to the challenge of having their products seen as true alternatives rather than crippled Apple clones, they won't rise to their full potential, and my inability to find someone who wants to buy the RIM PlayBook for themselves and the poor sales of most iPod competitors is the failed effort that will likely be the result.

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Help us keep this a respectfully Foolish area! This is a place for our readers to discuss, debate, and learn more about the Foolish investing topic you read about above. Help us keep it clean and safe. If you believe a comment is abusive or otherwise violates our Fool's Rules, please report it via the Report this Comment Report this Comment icon found on every comment.

  • Report this Comment On October 01, 2010, at 3:07 PM, MurphyMacdotCom wrote:

    "So the RIM PlayBook, which is more portable, has a lower price, has twin cameras, has better connectivity to the web, better video wireless capability, and native Flash support, and it is largely designed to do well in many of the disciplines the iPad does poorly. "

    HAS twin cameras? IS more portable? This device doesn't HAVE anything from what I've read. RIM didn't have one at their event - just video of one in action.

    The Microsoft Courier HAD a lot of stuff people were excited about - but it didn't and doesn't exist.

    People are underestimating the time Apple put into developing the iPad. And thinking the copycats can put out a legit competitor this fast. How did that work out with the iPhone competitors?

    Microsoft STILL hasn't released their iPhone competitor - and when it does it'll be short on features like Cut and Paste - something the Microsoft fans condemned Apple for not including with earlier iPhones.

    That situation alone clarifies how far behind Apple's competition is on the tablet front.

  • Report this Comment On October 01, 2010, at 3:27 PM, sk8ertor wrote:

    I want a PlayBook and will buy one when it comes out. Why you ask? Because I want something that is as portable as the PlayBook. It is the perfect size, will sync great with my BlackBerry, and I believe the new QNX OS will be awesome. So there you go, you have someone who wants and will buy a PlayBook when it's released.

    You prove that you're an absolute FOOL for wanting the inferior iPad, and falling for Apple's scheme yet again. Same as they did when they released the original iPhone that lacked so many features, only to screw people later on by adding things that should have been made available since day one. Besides, if you want to carry something as big as an iPad, why not just get a thin and light laptop that you can actually type?

  • Report this Comment On October 01, 2010, at 3:35 PM, twolf2919 wrote:

    MillerFallsMan,

    While I'm not excusing the first poster - he indeed seems like an Apple fanboy - you're not any better than him. The Playbook is not yet available, so you definitely don't own one. So how do you know it's better? From the specs? That doesn't account for everything. Until recently (1 1/2 years ago) I never owned an Apple product. I'm a geek & software developer, so I always bought what had the most 'bang for the buck'...and installed Linux on it :-)

    Then I got my wife the iPhone. Best device purchase I ever made! In our 3-member family, it became the most popular device. When my contract ended, I got an iPhone as well. My daughter got an iPod Touch. None of these devices had great technology/specs - but they were (are?) the most usable devices on the market. Even considering the great shortcoming of not supporting Flash! A few months ago, a colleague got the original Droid - after he owned an iphone. But he, himself admits that the UI of it wasn't as smooth/well-thought-out as the iPhone. I played with it briefly and concur. A few weeks ago, another colleague got the new Galaxy phone for AT&T (name escapes me) - which runs Android 2.2 - much nicer! It is pretty much as usable as my iphone and ha many features my phone lacks. I'm waiting for my contract to end to decide what to do.

    Now to the iPad. I recently bought my wife the iPad (her eyes have been killing her, reading Chinese web sites on the tiny iphone screen). It was pricey, but it's the only thing on the market that's as easy to navigate as the iphone (some of it is muscle-memory: we don't want to have to learn something new if we don't have to). My wife is extremely happy as she can now more easily read those sites - but she can also stream movies nobody else in the family wants to see (Chinese movies, of course :-)

    But the iPad has the same damn Flash limitation. Lucky for Apple that we make our purchasing decisions based on what's available rather than what might be available (I waited with the iPad purchase until Samsung announced its Galaxy Tab - which seemed very promising - but, alas, it won't be available in the US for months to come and, when it does, it will be too pricey!)

    Oh, and I recently traded in my Dell Latitude work laptop with a Mac Book Pro - because my experience with the iPhone, the iTouch, and the iPad were so positive and I got tired trying to keep my iphone synced via a Virtual Machine of Windows inside my Ubuntu laptop.

    I just wish Steve Jobs wasn't so pig-headed when it comes to Flash. I wish he let *US* choose whether to run it or not.

  • Report this Comment On October 01, 2010, at 3:37 PM, gfbjohn wrote:

    I doubt RIM will be able to start running fast enough. S Jobs presented his one ring circus and had the entire audience doing the head nod dance, and that spread viraly far and wide. Apple mountain is growing daily as more and more people buy into the Apple ecosystem - it could well get to the point that RIM won't be able to convince people to switch to Playbook if given away for free with a free year's worth of connectivity. Hmmmm, actually, I might be persuaded with a come-on like that. After all, Gillette grabbed its market share by making the blade holder cheap and reaping salvation in blade sales. But as Apple Mountain grows ever higher, not only is the climb going uphill for RIM or any other company, the climb continues to get longer and steeper. Not exactly a challenge I'd want to be responsible for helping my company to succeed at.

  • Report this Comment On October 01, 2010, at 3:47 PM, isellwireless wrote:

    The author is clearly biased in favor of Apple. However, there are valid points raised in the way customers are swayed by Apple's ‘Halo Effect’. The marketing efforts of Apple are heavily skewed to the techy, trendy, snob fashionista demographics. In fact I would make this a case study of how Apple marketing communications have a ‘blinding effect’ on customers with the way Apple products are perceived. The only exception that I remember is the failure of Apple TV to gain interest from the same market.

    That said, analysts need to consider the way Blackberry differentiates its branding efforts. From the BB Dev Con, it was said over and over that the PlayBook is a professional device. I felt there was a dis-connect with the visuals from the message but will have to wait until actual launch and gather more data.

    Finally, if the listed Playbook specs translate well to the actual device, then there will be truly legitimate alternative to the iPad and dare I say it, its next iteration as well.

  • Report this Comment On October 01, 2010, at 3:50 PM, chipwinter wrote:

    Please don't let this author on this site anymore. Rob Enderle has a terrible conflict of interest situation, and his analysis is oftentimes error-filled.

    This guy was consulting with Dell at the same time he was filling the web with stories about how great Dell was. He's a for-hire tech PR guy, not an analyst.

    As an example of falsehood in this article: Enderle states: "So the RIM PlayBook, which is more portable, has a lower price ..."

    This is false. The PlayBook does not currently have a lower price than the iPad, as RIM has not announced any pricing.

    Please, please, keep this man off the Fool website.

  • Report this Comment On October 01, 2010, at 3:59 PM, tgauchat wrote:

    Wow... the religious war continues.

  • Report this Comment On October 01, 2010, at 4:02 PM, gslusher wrote:

    "relatively (compared to the iPhone and iPod touch) few killer applications."

    The iPad can run essentially all iOS apps that don't rely on the phone or camera--IOW, what theiPod touch could run unttil the latest version.

    "These include the inability to use the product outside (something the Kindle is successfully marketing against)"

    Do note that the PlayBook has the same limitation, as does nearly every digital camera and camcorder as well as most laptops and netbooks. The Kindle's screen can be read in daylight, but NOT in dim light. You might also point out that the Kindle does a GREAT job of presenting color and video. [Sarcasm intended.]

    Re the PlayBook: "has better connectivity to the web,"

    How? On its own, it will have the SAME wireless capability as the iPad. If you want to use it with 3G, you will have to connect it to a BlackBerry.

  • Report this Comment On October 01, 2010, at 4:21 PM, Rondan wrote:

    @MillerFallsMan

    "Just another arrogant American Apple lemming, that does not know squat about technology and business."

    So not only are you anti- American, but also an anti-Apple lemming!

    If the actual Playbook is ever released a relatively small number of people will buy it.

    The proof of a product is in the net profit it produces. If people don't like or want a product it won't sell well.

    When the Paybook is finally released many other wannabee iPad tablets will also be competing with it.

    Apple innovates and all of the tech sheep follow with me too stuff.

    The me too buyers seem to be upset that Apple is the tech leader. Seems to be pure envy.

    The App store has over 250,000 apps. Rim would start with relatively few. Lot's of people do and will continue to prefer the choice the app store provides.

    At the moment the unreleased Playbook is smoke and mirrors.

  • Report this Comment On October 01, 2010, at 5:02 PM, echotango0 wrote:

    I think you make a great point, only not point you intended. Apple is a great company, their devices are truly innovative and world-class. What bugs me about Apple is their marketing spin attempts to portray Apple as the ONLY innovative world-class company.

    Just look at he number of articles written about Apple's competitors and how every product is inferior for this reason or that. Some is true, but much of the "insightful analysis" is simply false or a distortion of the facts. And it just keeps on coming, day after day.

    This article clearly shows the level desperation these sycophants will go to trying to find a new "insights" as why Apple will prevail even when presented with a potentially superior product.

  • Report this Comment On October 01, 2010, at 8:50 PM, MurphyMacdotCom wrote:

    For everyone who says "Jobs is arrogant" or "Jobs is egotistical" - who is arguing with you?

    You sound like you assume the other CEOs are NOT arrogant. Are you that foolish?

    Take airline CEOs - they don't give you the features you want. They screw you every step of the way. But does anyone make noise about them being arrogant?

    Get real. And stop calling the 10% of the people with Macs lemmings. Wouldn't that be the 90% running Windows?

  • Report this Comment On October 03, 2010, at 1:22 AM, alexkhan2000 wrote:

    MillerFallsFan is another typical life-less Apple/Jobs hater typing away in his mom's basement. You see a few of these types in every tech site. They are as predictable as the sun rising in the morning.

    Getting back to the subject on hand, of course some people will buy the Playbook. Some people have bought the Dell Streak and the Microsoft Kin too.

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