Research in Motion has started its price cuts on the PlayBook in earnest and how many units move will go a long way to highlighting the lasting damage from HP's TouchPad fire sale.
If you recall, HP discontinued the TouchPad and liquidated inventory with a 16GB version going for $99. The HP sale started a bit of a frenzy. The biggest lesson from the TouchPad sale is that price matters---a lot.
Enter RIM. The company on its last earnings call said it would cut prices and offer promotions to move PlayBooks. In its most recent quarter, RIM shipped 200,000 PlayBooks or about half of what was expected. The PlayBook is yet another RIM strike-out.
Now RIM is offering a 7-inch 16GB Wi-Fi PlayBook for $299 with a $100 coupon and $100 rebate. My initial reaction: $299 is still too high. Staples, Office Depot and Best Buy are offering the PlayBook price cuts.
Keep in mind that Amazon's Kindle tablet is coming---perhaps as soon as Wednesday. That device, which is likely to have a better ecosystem around it---could go for $250 tops.
Given those moving parts, I'd need the PlayBook to come in at $199 to get me interested. Even then it's a stretch.
As 2011 enters its final quarter, the damage from HP's TouchPad sale will become readily apparent. The army of tablets struggling to upend Apple's iPad are going have to get cheaper in a hurry. RIM is going to have to go lower if it wants to move units.
Here's the view from Staples: