At a hip party on Thursday night in New York, bloggers mingled with hedge fund managers in an exhibition space overlooking the Hudson River. A bustling crowd munched on coconut shrimp and sipped glasses of "PlayBook Punch" - vodka, white wine and passion fruit juice - while peering at gleaming tablets displayed along counters. Research In Motion Ltd. was launching its boldest new bet in years: the much-anticipated PlayBook tablet.
But the celebration was not enough to drown out the fact that, in Manhattan and elsewhere, the Canadian technology icon was facing a serious setback: Critics' reviews were harsh. Initial responses to the PlayBook, which hits stores next week, praised its display screen, smaller size and one-of-a-kind capabilities, but criticized the company for releasing a product that felt unfinished, with a limited number of software applications made for it.
For RIM, the stakes are enormous. This is not just a product launch - involving the investment of considerable time, money and prestige in developing PlayBook - but a vital step in its evolution.
The PlayBook is important to RIM's attempt to regain momentum it has lost to Apple Inc. and other makers of mobile electronics. It is the company's first attempt to branch out beyond phones and pagers and into a device that is more like a small personal computer. The PlayBook also runs on new software, which RIM executives hope will become popular with consumers so that they can use it for other products, including new versions of the BlackBerry.
Now RIM is facing criticism for appearing to rush the tablet to market. David Pogue, the influential tech critic at The New York Times, wrote that the PlayBook's "current half-baked form" makes it seem "almost silly to try to assess it, let alone buy it." At The Wall Street Journal, tech guru Walter Mossberg voiced similar qualms. "I got the strong impression RIM is scrambling to get the product to market," he wrote.
Perhaps the most comprehensive analysis so far came from Kevin Michaluk of the popular blog CrackBerry, which focuses almost exclusively on coverage of RIM's products. "So did the BlackBerry PlayBook hit the ball straight out of the park? Not quite," Mr. Michaluk wrote. "A little more practice time in the batting cage before stepping out on the field may have been the call to make on this one."
RIM shares closed down 2 per cent on the Toronto Stock Exchange Thursday as investors digested the reviews for its tablet. And the reviews aren't the only glitches to mar the PlayBook rollout. Earlier this week, Mike Lazaridis, RIM's co-chief executive officer, walked out on an interview with a BBC reporter after being asked about the company's tangles with governments in India and the Middle East over network security issues.
Craig McLennan, RIM's regional managing director for North America, played down the significance of the early criticism. "The real initial reviews are the customers," he said in an interview at Thursday's event. "You'll find the sales of this product are going to be very impressive."
Mr. McLennan said the company had received a strong flow of preorders for the PlayBook tablet from both businesses and individuals. "We have every expectation we will be a leader in this category," he said.
The true test will begin on Tuesday, when the PlayBook arrives on store shelves in Canada and the United States. Some experts said that the drawbacks noted by reviewers weren't grave.
"This is the new reality of consumer devices, which is that they're put out before they're perfect and then improved over time via software updates," said Sarah Rotman Epps, a senior analyst at Forrester Research. "Consumers do have a tolerance for imperfections."
The bigger issue, she said, is the PlayBook's reliance on a nearby BlackBerry to run crucial applications such as e-mail. That may be fine for existing BlackBerry users, but not for everyone else. "They're trying to market this as a product that has appeal to an even wider audience and that's where I think the delivery falls short," she said.
Analysts at RBC Dominion Securities wrote in a note Thursday that they expect the PlayBook to "stake its own ground in the tablet market - after a modest start." They conducted a survey of existing BlackBerry users and found that 12 per cent of them were likely to purchase the tablet when it became available.
Other experts underscored that many uncertainties remain about the PlayBook's ultimate desirability. In a note to clients, analysts at UBS questioned whether consumers would be willing to buy a product whose price is similar to that of the iPad but which has a more limited range of applications.
With a report from Omar El Akkad