RIM Drops PlayBook's Price (Production?) After Kindle Fire

RIM has slashed $200 off the price of all three BlackBerry PlayBook tablets, but it may not be due to the Kindle Fire.

ZoomJust hours after Amazon revealed its new line of Kindle devices -- especially the semi-clone Kindle Fire -- RIM decided to knock a meaty $200 off the pricetag of its three BlackBerry PlayBook tablets.

The price cut has been spotted over at Best Buy where the electronics retailer is offering the 16 GB model for $299 (from $499), the 32 GB model for $399 (from $599) and the 64 GB model for $499 (from $699). This sale seems to be good for both online and offline purchases, and there's no clear indication that this is a brief promotional price reduction, or a permanent thing. Still, those wanting to grab the 16 GB version may have to wait, as the site lists it as "back ordered" -- the other two are still available.

The sudden price drop is seemingly blamed on Amazon's just-announced 7-inch Kindle Fire Android tablet which reportedly uses the 7-inch PlayBook's base hardware as a template, but with several reductions: there's only 8 GB of on-board storage (but additional cloud storage), the front and rear cameras have been removed, there's no micro-HDMI port, and the battery only lasts up to 7.5 hours (the PlayBook offers 10 hours). Reports claim that it uses a similar Texas Instruments dual-core SoC, but clocked at a slower rate.

Naturally the big difference between the $199 8 GB Kindle Fire and the $299 16 GB BlackBerry PlayBook is the storage capacity and the operating system. But RIM's sudden price reduction may not be solely attributed to the Kindle Fire launch, as the company was forced to dramatically cut down on production of its tablets due to poor sales at its original price point. Like HP, RIM simply may have chosen to hack prices in order to get product rolling off the shelves.

Best Buy's Canadian Web site, Staples and even Walmart kicked off similar discounts for the PlayBook earlier this week, but not quite as drastic. As seen here, Staples is now selling all three tablets with their original pricetag, but is also offering a $100 instant coupon and an additional $100 instant rebate on all three models. Best Buy Canada knocked $100 off the original price and threw in an additional $100 store gift card.

UPDATE: Analysts are now claiming that RIM may have actually halted production of the tablet. "We believe RIM has stopped production of its PlayBook and is actively considering exiting the tabletmarket," Collins Stewart semiconductor analyst John Vihn wrote in a note obtained by Reuters. "Additionally, our due diligence indicates that RIM has canceled development of additional tablet projects."

RIM reportedly shipped 500,000 PlayBooks in the last six weeks of its fiscal first quarter, and another 200,000 in its full second quarter.