Playing with PlayBook

Last month, when Research In Motion unveiled PlayBook at the BlackBerry Developers Conference in San Francisco, there was no demo. The co-CEOs, Mike Lazaridis and Jim Balsillie, had done this sort of tapdance before. In the pre-BlackBerry days, when the then current model was called Bullfrog because it was so big, RIM came up with Leapfrog. It was much smaller, about the size of a deck of cards.

In 1997 Mike and Jim flew to Atlanta to show Leapfrog to executives at BellSouth. But all they had were two wooden models, each with a plastic screen and a pasted-on paper keyboard. You could turn the sidemounted trackwheel, but nothing happened. It didn’t matter. The grown men around the boardroom table took turns reverently holding the devices just as if they worked. BellSouth placed a $70 million order and RIM was well and truly launched.

The September audience in San Francisco  was not so easily amused. Then, yesterday, at the Adobe Developers Conference, Mike showed a real working PlayBook tablet complete with video from YouTube and other demos. “We believe the PlayBook is by far the most leading-edge BlackBerry device ever designed and the device could be a catalyst for the stock,” wrote Barry Richards, an analyst with Paradigm Capital, in a note to clients today. “With 50 million users, the device has a $20 billion potential market, even in just the BlackBerry installed base.” Richards, who has been following RIM since the days of Leapfrog, has a buy on the stock and a 12-month target price of US$105.

Mike’s demo sent RIM share price up more than 5 per cent yesterday and it’s heading higher again this morning. All of which proves in today’s world of reality TV, audiences want to see working models. The wooden ships of yore are not good enough for today’s highflyers.