With second-quarter shipments for the PlayBook lower than expected, Research In Motion is striking back and readying significant enhancements, including the introduction of a video store.

In response to the competitive landscape in tablets and its own poor showing in the second quarter, RIM announced a series of enhancements to the PlayBook last week, including efforts to build the PlayBook ecosystem for apps and content. The new release will include BlackBerry video, which will have 10,000 movies and TV shows available on demand to buy or rent.

?We recognize that the current availability of content and applications for PlayBook has limited the near-term uptake of the device in the market, and we are actively working with key partners to deliver the most desired applications and content to our targeted market segments,? said Michael Lazaridis, president and co-CEO of RIM, Waterloo, ON, during a conference call with analysts to discuss the company?s second quarter results.

Competition heats up
RIM also told analysts that it is planning to promote the PlayBook this fall to help drive enterprise and consumer adoption. The promotions will include special incentive programs for enterprises, a loyalty program for existing BlackBerry customers and rebates in consumer channels.

The company?s revenue during the second quarter was $4.2 billion, down 15 percent from $4.9 billion in the previous quarter and down 10 percent from the same quarter last year.

?We are confident that these activities will generate an increase in demand and sell-through in the third quarter and into the holiday season,? Mr. Lazaridis said.

Last week RIM reported that it shipped approximately 200,000 BlackBerry PlayBook tablets during its fiscal second quarter, which ended Aug. 27.

While this number is lower than what the company was hoping for, executives said that they believe the PlayBook will ultimately be successful in the young, but quickly growing tablet space.

While the tablet space is growing quickly, Apple continues to dominate the space with the iPad. Apple?s role is so significant that Hewlett-Packard recently said it will abandon its efforts to enter the tablet space and will stop making the TouchPad tablet (see story).

RIM is also attempting to compete with Apple in the tablet space without much success so far.

Apple reported in July that it shipped a record 9.25 million iPad units during its third quarter.

In addition to selling only 200,000 units of the PlayBook, RIM?s tablet appears to be struggling at retail, with Best Buy recently slashing its price for the PlayBook by $150.

The other wrinkle here for RIM is that Amazon is rumored to be readying its own tablet, which Forrester recently suggested could sell as many as 5 million units in the fourth quarter with a lower-priced offering.

?RIM is facing increasing competition in the tablet arena from a host of players in all different areas,? said Rhoda Alexander, director for monitor research at IHS iSuppli, El Segundo, CA. ?It is going to be a very brutal market out there.

?The fourth quarter may be a real decision tree when it comes to the future of tablets,? she said. ?When you look at the movement with regards to tablet volume in the fourth quarter, I think we will see a real separation between high-end, high-performance tablets and value-end tablets.?

Such a separation in the market will make it tough for the tablet vendors who are trying to sit in between high-end and value.

?The PlayBook has traditionally been positioned at the high-end,? Ms. Alexander said. ?Whether that is what they have planned for this product going forward is not clear yet.?

PlayBook 2.0
RIM will bundle a number of new features and enhancements together into a major new software release for PlayBook that will be demonstrated at DevCon in October and released after.

The enhancements delivered in the PlayBook 2.0 release are expected to include built-in native email, calendar and contacts, robust enterprise features, the previously announced Android app player, enhanced Web browsing.

PlayBook 2.0 will also make available new consumers apps as well as multimedia and video content.

?The BlackBerry mobile device started out in the corporate market, but they?ve really reached out much more extensively into the consumer market, which now makes up a substantial portion of their customer base,? Ms. Alexander said.

?These enhancements are very much in response to that reality ? that internally they can?t develop all that content so it makes more sense to piggyback on the content that is already out there,? she said.

?It should make the PlayBook more desirable.?

Final Take
Chantal Tode is associate editor on Mobile Marketer, New York