Blackberry Playbook 2.0 Review: Ugly Duckling to Swan

Blackberry released Playbook 2.0 in February 2012, some 10 months after its initial launch. Playbook 2.0 marks a decisive internal achievement for the company. RIM was not in a position to release another Storm device. QNX 2 is also the framework for Blackberry 10, so all work would eventually form the basis for its next-generation device.

Playbook 1.08 was Blackberry's ugly duckling of devices. While it was usable and functional, other users found it clumsy, difficult to pair with blackberry phones (initially), and included applications like Office and Adobe Acrobat reader basic.

In the time between the initial launch and the re-release, the tablet landscape changed in so many ways. HP's WebOS tablet was released, then discontinued 6 weeks later and sold at a fire sale price of $99. Amazon's Kindle Fire re-defined the baseline price for tablets at $199. Finally, Apple iPad 2 continued to be the tablet market.

Playbook 2.0 now costs $199, but is comparatively less expensive to own than Amazon's Kindle Fire and is more functional. Front/back cameras, memory, storage, app world, and productivity applications are only a few of the things that are included with 2.0.

Playbook 2.0 is a modest but complete evolution from version 1. Within its new price-range, the device is a “swan” compared to what it was before. At the top of the strong points for Playbook are pricing and portability.  Functionality is strongest for web browsing, watching videos, and corresponding by emails.
The Playbook made emailing fun again.

A welcome touch was this email signature:

Sent from my BlackBerry® PlayBook™
www.blackberry.com

Having used the device for this long, this review will be bias with praise, so the discussion will be about how to make the most from the device. This entry was made directly from the Playbook device connected to a Bluetooth keyboard.
Making $2490 from $249
Getting the Playbook on “the cloud” is very simple, and just requires a few application downloads and a bit of changes in process.
Securities analysis requires the reading of hundreds of pages of documents. SEC filings in Excel, Word, and PDF format can easily be read on the playbook. This is done in the following way:
1. Installing "BlueBox"
2. Creating an account on Dropbox to connect to the BlueBox application
3. Using the Playbook browser to download attachments and saving to the device
4. Copying the files so that it may be accessed on a desktop or any computer with Dropbox installed
5. Using the new File Manager or 'Air Browser' to transfer from the BlueBox folder to the device

Note: Air Browser is a free application download.

BlueBox:

 

AIR Browser:

All Work and No Play...
To celebrate the launch, Blackberry made Asphalt 6 and Modern Combat available for free. They are inexpensive ($0.99) but are excellent games.

Playbook now supports folders. Below is a screen capture (press + and - buttons to capture an image). Here are some recommended games to buy or download for the Playbook:

Playbook demonstrates that Facebook is a Glorified Birthday Reminder. Birthdays are added to the calendar. As more appointments are added in a given day, the day number on the calendar gets bigger.
Email and calendar support was added to 2.0. When linking an email account to the device, contacts and calendar appointments are synchronized to the Playbook. Users are notified by way of a glowing red at the top left of the screen, and/or a blinking red LED. The email application supports twitter direct messages (unless the account is a corporation), LinkedIn, Gmail, Hotmail, POP email, and Facebook:

Video Chat
RIM integrated video chat to social media accounts to the Playbook. Facebook contacts show up on the Video Chat contacts list. Contacts who use a Playbook may be reached by video.

Connecting Playbook to Smartphone (“Bridge”)
Linking the blackberry phone to the Playbook was a breeze. After downloading an update for the phone, Blackberry bridge pairing (Bluetooth) was effortless.

Send Blackberry Phone Attachments to Playbook
To read file attachments more effectively, or to open website URLs received on a smart phone, users may now send them to the Playbook.

Mouse and Keyboard Included
Blackberry phone users have one more reason to own a Playbook. Blackberry Bridge connection turns the smart phone into a mouse and a keyboard. The phone may now be used as an alternative to the on-screen keyboard, or as a remote control if the tablet is used for watching movies. To connect the Playbook via HDMI, a micro-HDMI (not included but costs about $5) is required.

Playbook Spell Check and SwiftKey Keyboard
Playbook 1.0 did not have a fully functional spell-check. Typos would be identified but the correct spelling was not offered. In 2.0, the predictive text integrates well with spell-checking:

Docs to Go, Print To Go, and Android Applications
The included Docs to Go application is improved. Word count and bookmarks are two improvements in the Word program. "Print To Go" is a new application that enables users to send print documents from desktops to the Playbook. Note that this only works if the Playbook and the desktop are connected to the same network.
To help developers port Android application to the Playbook, RIM added support for Android. Consumers are confused in thinking Android applications are directly supported on the Playbook. This is not true. The Android-based application must be approved by RIM and then posted to App World.

Final Thoughts
At the current price point, Playbook 2.0 will likely sell better than anyone expects, but it will not generate substantial profits for RIM at this time. This implies that consumers end up the winner in getting a fully-functional, portable, device that gets the job of emailing, HTML5/Flash-supported web surfing, and document management done at prices far lower than that of the iPad. Retailing at between $519 and above, Apple might lower the price of iPad2 when iPad3 is released on March 7. This would strike to be an unusual move for Apple, since Apple rarely needs to discount any of its products to maintain its competitive position.
Recall that when Playbook was originally launched, RIM and the market focused on building a device comparable to the specifications of iPad1. Apple surprised the market by releasing iPad2, making things worse for RIM. As it stands, RIM's competitive threat to Apple is quite low, although RIM managed to reach a double-digit market share for tablets in Canada by December 2011.

The competitive positioning for RIM is very clear: the company must play on its own internal strength of group messaging (BBM) and the frugality of a cheaper smart phone/tablet data plan to appeal to consumers. Blackberry 7, albeit a "transition" operating system until BB10 is ready, is still a very functional device. The Torch 2 and Bold line-up have processors over 1.2GHz and whose web browsing experience is better than the older models. Even the Curve works well with the Playbook.

Two further points are worth mentioning. Marketing for RIM in North America needs to be limited and focused. Both Apple and Android dominate, so any advertising is likely to be of limited effectiveness. Where RIM shines is in countries where consumers are conscious about their monthly plan costs. With Nokia's Windows-based phones competing in the low-end, RIM must ensure consumers chose Blackberry when upgrading from a feature phone. With Playbook 2.0’s solid functionality alongside its smart phone as a companion, RIM added another reason to take choose a Blackberry.

Further Reading: click here.
@Twitter here.

$RIMM marketing: get aggressive against Apple

Here's an exclusive publication on RIM: http://seekingalpha.com/article/275733-catalysts-for-a-rebound-in-research-in-motion-shares

Another marketing executive left RIM. This gives insight on how the company will approach its cost-cutting: the marketing department.

That said, a clean-house in the marketing department can mean good things for consumers if RIM gets aggressive. A user posted this comment (prior to this announcement) about what RIM can do in marketing:

But their marketing department could use a bit of an overhaul. They need to be much more in-your-face. Trade any iphone for a BB promotions. Trade any ipad for a playbook promotion. 10 free apps with every purchase, regardless of price. Max cost for new phone without plan = $200, not $600. Go for volume. Offer deals to Bell et al if they shun Apple products -- you know that's done in the states.

The major drawback from the BB OS is it doesn't feel as 'silky' as the iphone OS. The Playbook fixes this, and the ports to other phones of that OS has to happen NOW, not months from now.

And in marketing faux pas, RIM decided (wrongly) that its v6 OS would not be made available to phones before the latest Bold, crapping on all the new Tour et al owners. This is the type of mentality that has to stop.

Why $RIMM Will Not Go Away

The popularity for Android and iPhone resulted in a massive decline in sales of Blackberry in North America. That, and slow operating system updates and a relatively slow refresh cycle for newer models of the device resulted in RIM's demise Friday.


RIM, however, is not dead. It will not die, as most would wish, because of three reasons.


1. Battery life is very good, provided a user does not install a "leaky" app (unlike with Android).
2. No presumptuous spell check system (iPhone)
3. Some users will not give up a keyboard


Here's a comment summing up what went wrong with Blackberry over the last 8 quarters:

I had a Blackberry for years (for business) and loved it, then made the switch to Android thinking it's the next generation smart phones and would be better. WORST MISTAKE EVER! Android and Windows phones are made for 12 year old girls who like to gossip and send pics to each other. Blackberries are the no nonsense utility phones. Unfortunately RIM lost sight of their strength and started competing directly with the others by coping their models and thus its failure. They should have stuck to what they did best.

Read more: http://www.businessinsider.com/chart-of-the-day-rims-astounding-collapse-in-the-us-2011-6#ixzz1PolRqS00

Two Publications

Two articles were accepted by SeekingAlpha for publication. The RIM piece was ready after using the Playbook for over a hundred hours and after gaining the experience of updating 3 generations of Blackberry Phones and moving the devices over to RIM's Blackberry Enterprise Server (BES) 5.

1. 6 Things You Should Know Before Writing Off Research In Motion 
2. Microsoft Looks to Gain From Hardware Deal, New Revenue Stream

Notes on Nokia 14% Share Price Drop

Barrons covered an opportunity may exist for RIM as Nokia warned that it faltered in Europe.

One comment that stood out was that shift among smartphone makers lies at the developer software level.

• Christian wrote:

I don’t understand why people are so surprised with the sales decline, since that is very obvious when changing technology. When Nokia announced their alliance with Microsoft I saw it as very smart move. I guess I’m one of the only ones, but I am also a developer ;). The lack of channels and usability has been the biggest problem for Nokia and the alliance cures this, since Microsoft have some of the best developer tools, biggest user base and now they have Skype as well. An acquisition which I think is not as stupid as many have stated, but lets see.

Nokia is one of the best at mobile and network technology and still not to forget has the largest mobile user base. And I really don’t understand why people are so dissatisfied with Steven Elop, since he is doing everything which is needed. Cutting expensive, making a quick shift, fast in executing, targeting the developer community and is very aware of the competition he is up against.

And as I said Nokia technology is good they have the patents to prove it. Moreover as a former Symbian C++ developer I know this technology is good. Very fast, the architecture is very well designed and has a low energy use. The problem has always been the developer tools, the multiple platforms and the distribution channels. I remember trying to get Symbian development to work under Microsoft Visual Studio and with no luck, shifting to Borland which is not my favorite. It was just a drag. I think most developers will agree ;)

Now it’s going to be one platform where there is one of the largest developer bases in the world. I would reckon just a bit larger than iPhone developers. That was with sarcasm for those of you who don’t know anything about this, there is lots more and I would reckon this is largest developer base in the world. Moreover this base is ready to easily push application on a platform where the usability and the channels have been radically improved. Just look at the numbers of applications in the last period of time. Not to forget that this platform actually has gotten a warm welcome from end-users taken into account the competition.

The problem with this kind of stock is that people don’t anything about these things, which means that it will probably continue to decline and then there the few who are going to make a huge profit. Maybe Microsoft?

Microsoft in general not doing so bad. Moreover have they made mobile the primary key concern and they have the money to do it, lots of it. Not to forget, how they did concerning Internet Explorer not so many years ago, do you remember?

Google is cool but I must also admit that I am not that impressed with Android. They are already facing the same problems as with Java Microedition – J2ME. With different platforms, functionality, different user interfaces, etc. This is crap work for developers and ends up making software for the lowest denominator. It is not fun now and this is only going to get worse.

I am impressed with Apple wow! I love my iPhone and had to have it even though I am not an Apple fanboy. Fantastic phone, but they have done their share and it’s only to copy now. Moreover when people in the future realizes how closed and tightly coupled they are to this platform when new technologies arise they are going to be surprised and I don’t think it is going in Apples favor. Look at the history it just repeats.

Well let’s see, this is very interesting. I’m quite sure that we are going to see some long faces once again.

Believe me I don’t think Nokia will be as big as before but to announce that they are done I would believe is very wrong.

Blackberry Playbook Post-Processing Showdown

Original: From Playbook 5MP

Modified with $2.99 Photo Touchup App in 30 seconds: 

As angry analysts issue 'sell' reports on RIM after the fact (the time to issue this warning was prior to the stock running up), let's take a step back and think of what the Playbook can do in the area a photography.

This entry was blogged from a Playbook. Additional edits made on a desktop.

Above: 5mp rear camera Playbook, no processing.

Photo 2: post-processed with 'Photo Touchup' - app available on app world

Below: post-processed in Photoshop:

Modified in Adobe Photoshop in 5 minutes including upload time:

It is unfair to compare the abilities of Photo Touchup App to Photoshop. Photoshop is a professional tool with thousands of post-processing options, and costs 500 times more. The Playbook has a good 5MP lens with f/2.8. This makes the lens faster than the average camera.

In the above example, it was easy to adjust color amounts (of green/blue), light balance, etc. 

What Touchup allowed was the ability to quickly touch-up the photo in-tablet.

Conclusion: RIM Playbook has good apps available for processing photos. What's more important is finding the few apps that matter, and Photo touchup is one of them. 

To find the best apps for the playbook, select featured or top. The apps with the most comments alongside the ranking are usually the best ones that make the "favorite" section of the Playbook.

Amazon.com in a Bubble, RIM (Stock) is in Trouble

At Zerohedge, RIM's earnings shortfall was posted. RIM traded down between 10-15% last night, and is trading down 12.5% this morning in pre-market.

The culprit for the earnings shortfall? A refresh to the Blackberry smart phones is late. It seems that RIM was so preoccupied with the Playbook tablet launch that it neglected its core business. This is never a good thing, but was necessary for RIM.

Let's compare RIM's trading to that of Amazon.com. Amazon announced weaker earnings, with everything on its balance sheet showing that business is amiss. Stock traded down after-hours, but by the next day, it traded up.

A user posted this about Amazon.com (with formatting edited).
The user's website is here: www.lemetropolecafe.com

AMZN

Let's Talk About A REAL Bubble 

I love this quote from the Amazon.com CEO in the Company's press release that accompanied the earnings report: "We love inventing on behalf of customers and have never been more excited about the long-term opportunities."He's probably thinking to himself also: "We love inventing earnings reports on behalf of investors and have never been more excited about the opportunities for this enabled by GAAP and our Government."It boggles my mind that the only investment "bubble" that the financial media sees right now is gold and silver. I'm bored of explaining to people why gold is not even remotely in a bubble.

So let's look at what a real investment bubble looks like.

AMZN's total market cap is $90.4 billion. Now, AMZN announced that its latest operating income was $322 million vs. $394 million in Q1 2010. That's an 18% decline. Based the latest trailing 12 month cash flow just over $3 billion, AMZN is trading at 30x cash flow. When a normal company trades at anything over 5x cash flow, you expect that to be because you expect a very high rate of cash flow growth. BUT, AMZN's operating income, the largest component of cash flow, dropped 18%. Think the market is being insane about the prospects for AMZN's growth?

AMZN also announced that the operating income for next quarter would be between $94 million and $245 million. This is an incredibly wide variance in guidance and it blows my mind that the market has tacked on over $3 billion in market cap to AMZN for a company that can't project its cash flow expectation for Q2, which already 33% over! This is insane.
Let's give Bezos the benefit of assuming Q2 operating income will come in at the midpoint of $170 million and annualized that number, which is generous considering that operating income is now declining at double digits. This yields a forward operating income projection of $680 million. 

The stock thus trades at 132x operating income! THAT MY FRIENDS IS A BUBBLE.

Please note, we're not even talking about net income and p/e ratios here. Amazon's accounting is so obsfuscated by GAAP exploitation that I would more likely believe in the Easter bunny than I would Amazon's reported numbers.

So what's the deal? I used to track and untangle Amazon's accounting pretty closely up until about 8 years ago. I fatigued waiting for the SEC and NASD to crack down on AMZN'saccounting shenanigans. Of course the employees in those two organizations spend more time surfing porn than they do enforcing the law. The basic "crux" of Amazon's accounting exploitations has to do with how they account for fulfillment, marketing and shipping expenses. These are major major expenses for Amazon. Now, I don't have time to dissect its last 10K today, but I assume that they are still doing the same thing they were doing 8 years ago, especially since the source of their operating income cliff dive will be from these expenses.

In a nutshell, Amazon "buys" revenues by spending a massive amount on the process of getting you to buy from them. This includes subsidizing the price you pay by charging less than competitors and offering huge shipping deals, often extending free shipping. To be sure, they have negotiated favorable shipping deals with the big shippers. HOWEVER, they do not recognize the costs involved in all of this as they incur them, choosing instead to "capitalize" the majority of these costs. It's a "cost accounting" manipulation that is far too complicated for the regulators to understand. I don't have to go through the footnotes of their financials because all I had to do was read their press release to know they still do this.

Feel free to see what I mean HERE In the 7th paragraph they detail the nature of what I call their ramped up "revenue buying" programs.

The fact of the matter is that Amazon is one big ponzi scheme and as long as they can continue growing revenues, even at the expense of reporting declining operating income and cash flow, and as long as the stock market keeps inflating the AMZN bubble, then this scheme will continue. But believe me, the fact that their revenues are still growing at double digits AND their operating income is plummeting by double digits, tells me that they are getting a lot more desperate and aggressive at "buying" revenues.
Eventually this will come to an unhappy ending for everyone except the CEO Jeff Bezos, who sells millions of shares every quarter.

I would too if I were him.

In the meantime, I often buy from Amazon because it is convenient and, if they want to subsidized the cost of getting a product to my house, it is a lot cheaper in terms of what I pay plus the time involved and I love a "free lunch."

The bottom line for me is that I know that if I had time I could show you how Amazon likely loses money every quarter on a net income basis. I focus on operating income and cash flow because those are the numbers AMZN highlights in its press release. This harkens back to the tech bubble days when "pro forma" accounting was inserted in the financial media in place of true GAAP accounting. Now all tech companies use "pro forma" accounting and the stock market is conditioned to use it too. But even the operating income numbers they report are manipulated and dirty.

If anyone is interested, the footnotes in the last 10K will give you the keys to backing into somewhat real numbers. But we would need to see the inside books to see the golden truth.

Hot Stock: Palm

Move over Blackberry and iPhone? Behold, Palm Pre

http://blogs.itworldcanada.com/idol/2009/03/27/move-over-blackberry-and-iphone-behold-palm-pre/

US Bank Stocks: From Bust to Boom to ...
The financial sector virtually collapsed, then recovered, this week. Is the recovery for real? From a trading standpoint, most banks have traded back to their previously broken support line. With Citigroup, for example, the stock is in the $19-20 range. If the stock price holds in the next few days, then that will be an intermediate support price. If not, it will act as a level of resistance.

Tech Strength?
Not for RIM. Rim's sell-off was very apparent from the charts. Note MACD divergence to stock price:

A likely target prices for RIMM is $89.71. If that is broken, then the next level of support is $65.92.

Two forward-indicating stocks for the health of the economy I like to look at are FedEx and UPS. Why? Internet sales are done through these companies (profit). The company is affected directly by the cost of oil/energy. From mid-2006 to present, the MACD was already suggesting weakness for FedEx. The stock tried, but failed, three times to break the $118-120.70. The stock finally traded down to $75. It will be a stock to monitor in the next while to determine when the US economy is improving.