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January 3, 2012

There are reports that Research In Motion (RIM) is desperate to get rid of a huge inventory of its unpopular PlayBook tablets. Prices on all models in the U.S. have been slashed to $299 and they are still not selling.

You can now buy a 16 GB, 32 GB or 64 GB version of the tablet from the U.S. BlackBerry website at the reduced price. And, obviously, there's no point in opting for less memory when you can get one with the most memory for the same price.

On the 64 GB model, that gives a saving of $400 off the original expensive retail price of $699. And other retailers in the U.S. are still knocking down the prices even more.

Meanwhile, Amazon in the U.K. is offering the 16 GB model at £197.99, the 32 GB at £244.99 and the 64 GB at £339.90. The price-cutting in the U.S. is the latest attempt by RIM to clear massive stockpiles of the PlayBook, which has failed to spark any interest, even for the important Christmas and Holiday season.

Research In Motion took a $485 million charge at the end of its last quarter on the tablets, money it said it needed to increase promotional activity in order to "drive sell-through to end customers".

HP managed to ignite some interest in its beleaguered Touchpad when it dropped prices to rock bottom and introduced various promotional gimmicks to shift the tablets. Its Touchpad was slashed to $99 and finally started selling from day one, and now some wireless industry observers are saying that RIM should follow in HP's footsteps if it wants to rid itself of all that unwanted inventory.

So far, RIM has tried dropping prices and offering its PlayBooks on a buy-one-get-one-free basis, but it looks like the firm hasn't gone far enough yet to encourage anyone willing to buy a soon-to-be-discontinued item to pull out their wallets.

As of late yesterday, RIM had not returned a request for comment at the time of the publication of this story.

In other mobile news

Poynt is a new location-based (read GPS) search application, and its success is mainly attributed to the early support it received from Canadian-based smartphone maker Research In Motion (RIM).

Poynt's early success at RIM allowed the company to build stronger relationships with wireless carriers and other handset makers, allowing its app to be preloaded on even more devices.

Last month, Poynt announced an agreement to have its app loaded on all Samsung devices-- a major coup for the company since the South Korean consumer electronics giant is the world's largest smartphone manufacturer.

Then a few days later, Nokia said it would load Poynt on its new Lumia Windows Phone devices in India. Poynt has now surpassed 12 million unique users and is adding about 20,000 to 30,000 new users everyday. The app is available on the BlackBerry, iOS, Android, Nokia QT, and Windows Phone platforms.

"You can expect to see some additional deals in the first quarter," said Margaret Campbell, senior vice president of marketing for Poynt.

Last July, half of its 700,000 new users came from a wireless carrier preload deal, Campbell said. Poynt offers suggestions on everything from restaurants to gas stations based on a person's location. The company gets a cut of revenue generated whenever someone buys a ticket to a movie theater listed on its app, or makes a reservation at a restaurant located through Poynt.

And very much like Groupon, it now sends offers based on GPS location. The company sees targeted, location-based advertisements as the key growth driver for the company.

"You're starting to see a few brands and some advertising agencies coming on board," Campbell said. "We're seeing an upswing in revenue there."

With the value of intellectual property at an all-time high and patent lawsuits flying around, Poynt is looking to make better use of its own patents, which relate to location-based services and the delivery of coupons and offers to mobile devices.

The company is looking at potential licensing opportunities, and may even turn to litigation down the line. Campbell said Poynt's success can be attributed to the company's focus on building apps for specific phones and platforms, as opposed to porting one app to every device.

"If you want to be successful at any platform, you have to look at how to integrate it into that device," she said. "Look at who the audience is."

But RIM, which has run into a whole slew of major issues in the past few months, including the delay of its next-generation BlackBerrys, Campbell says she isn't too worried about the future of the company.

In other mobile industry news

As Wireless Industry News reported yesterday, Verizon said it was instituting a $2 convenience charge for those customers who make one-time bill payments using a debit or credit card, either online or by telephone. Well now the wireless carrier made an about-face and has decided to cancel the $2 fee.

Verizon has now confirmed that it was nixing the controversial fee. Yesterday's announcement has immediately sparked an uproar online from customers unhappy about the prospect of incurring further fees simply by paying existing ones.

"At Verizon Wireless, we take great care to listen to our customers. Based on their input, we believe the best path forward is to encourage customers to take advantage of the best and most efficient options, eliminating the need to institute the fee at this time," Verizon CEO Dan Mead said in a statement.

The so-called "convenience charge" was to have gone into effect Jan. 15, 2012. It would have applied to customers who make one-time bill payments using debit or credit cards, either online or by telephone, though the company planned to continue offering a variety of other free payment methods.

Earlier Friday, the Federal Communications Commission said it was "concerned about Verizon's actions" regarding the proposed new fee and was "looking into the matter."

In other mobile news

It appears that Verizon Wireless isn't making enough money from its mobile subscribers, and is now trying to find new ways to ask for more cash from its customers. Unbelievable you say? Read on.

For the past two years now, Verizon Wireless has been adding an average of about 2 to 2.2 million net new subscribers almost every quarter.

But now the wireless carrier will soon make some customers pay for the "privilege" of paying their bills.

The U.S.' largest wireless services provider is instituting a $2 "convenience charge" for those customers who make one-time bill payments using a debit or credit card, either online or by telephone. Like it or not, the new extra fee will go into effect on January 15, 2012.

There are now three ways for customers to avoid the charge: Customers can make a one-time payment using an electronic check, they can pay their bill using their home banking accounts, or they can use a Verizon gift card or rebate card.

Otherwise, single telephone and even online payments will incur a $2 extra fee. "The charge will help allow us to continue to support these single bill payment options and is designed to address costs incurred by us for only those customers who choose to make single bill payments," the company said in a statement.

Verizon customers can still enroll in a service that will debit their bank accounts or charge their credit cards on a recurring basis for free. They can also show up at a Verizon store to pay without incurring the fee, and they can mail checks to the company.

But it's still not clear how many of Verizon's 91 million mobile customers will be affected by the new charge. As of this morning, a company spokesman from Verizon didn't reply to a request for comment we've sent them yesterday.

The news came one day after Verizon Wireless' 4G network suffered its third service outage across all of the United States in as many weeks.

Elsewhere in the wireless industry, a Sprint spokesman said the company doesn't have similar fees, though according to Sprint's website, certain mobile customers who have accounts with spending limits are subject to a $5 monthly fee if they're not enrolled in automatic payments.

Over at T-Mobile USA, the mobile operator charges its customers $5 if they make payments over the phone with a company representative, a spokeswoman said. AT&T Mobility didn't return our requests for comment as of this morning.

Verizon's so-called convenience charge was announced at the end of a year in which banks were heavily criticized for charging customers a fee for using their debit cards. The banks claimed that the fees were necessary because new regulations would limit how much revenue stream they could make on the cards. However, new rules went into effect in September that capped the fees banks could charge retailers when customers swipe their debit cards.

Verizon's new $2 added fee is also akin to TicketMaster, which famously bills a "convenience charge" and "processing fee" on top of the price of every ticket.

It will be interesting to see if and how the other mobile operators in the U.S. and elsewhere will react to this soon, if they do. The wireless industry is rapidly getting more and more competitive everyday, so Verizon's decision surprised more than one industry analyst yesterday.

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Source: Research In Motion.

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