ORLANDO, Fla. - The chief executive of Research In Motion stood before the developers who could play a crucial role in the company's future and gave them a first-look Tuesday at the new BlackBerry 10 operating system.
The widely anticipated unveiling at its annual BlackBerry World conference centered on some awe-inspiring technological developments sandwiched between pounding club music and a heavy dose of flashing spotlights that could send any raver into a tizzy.
The three-day showcase is intended to get fickle programmers excited about the future of RIM (TSX:RIM) and developing applications for the BlackBerry 10. The Waterloo, Ont., company is struggling to recover from numerous blunders over the past year, including flagging sales, a woefully underdeveloped apps store and criticism that it hasn't released a new smartphone in ages.
"We're taking our time to make sure we get this right," Heins told developers shortly before revealing the BlackBerry 10 prototype at the keynote address.
"I know how much hard work went into this," he added.
Heins, who marked his 100th day atop the smartphone maker on Tuesday, then pulled a touch-screen device from his pocket running the BlackBerry 10 OS in its beta version.
"It's working, and it's working well," Heins reassured the crowd.
"That's why we took the decision to give it to our developers today because we want them to get going on this."
The device is called the Alpha Dev, and will only be available to developers. RIM will launch consumer hardware sometime later this year that will likely have a noticeably different appearance than the black, rectangular device that looks somewhat like a mini-PlayBook tablet.
While the new operating system is still in its test stages, Heins and other executives led the audience through a tour of some of the flashier new features of the system.
Overall, the interface shared a familiarity with those of the popular Apple iPhone and Android devices, though there were several new features that made it different.
Some of the highlights included a modified touch-screen keypad that adapts to common words each user types, and then allows them to select the full words with a single swipe of the screen.
But it was the smartphone's camera that really seemed to excite the audience. It has a feature that captures several frames in quick succession, frames which can be combined to create a single "ideal" picture. For example, if one person was blinking in a group photo shot, they can be replaced with an image of their face taken moments earlier with their eyes open.
When the company demonstrated fixing one picture of a woman — opening her eyes and tacking a smile on her face — the audience gasped and burst into applause.
That enthusiasm was no doubt what organizers hoped for, as app developers will be a major part of the company's strategy to keep pace with competitors.
That enthusiasm didn't appear to carry over to investors. Shares in Research In Motion closed down 82 cents, or 5.8 per cent, to $13.31 on the Toronto Stock Exchange.
For several years, the company has been criticized for neglecting its app store, BlackBerry App World, even when both Apple and Android devices were racing forward with a wide array of add-ons that ranged from popular games like Angry Birds to more practical assistants that helped file taxes and change TV channels.
If RIM is able to get more developers onside before the launch of its new devices, it will be further ammunition in its defensive against a rush competition expected later this year, when Apple will likely debut the next edition of its iPhone and new Android devices hit the market.
Each developer will go home from the Orlando conference with the new operating system on the prototype device, a move that will allow them to start building applications for the new platform.
The beta version of the operating system will be shared with "key carrier partners as well," Heins said.
"I'm very, very confident we will be there later this year with an exciting product."
RIM also marched out executives from partner companies like Cisco, which said it is working on a teleconferencing app that will run on the new operating system, and digital newsstand PixelMags.
Analysts have observed that by the time RIM releases its new BlackBerrys they'll be playing catch-up to the new iPhone and Android devices.
"The missing pieces are the apps because to a large extent the average user, who I think they're trying to attract, is after them," said Queen's University marketing professor and tech expert John Pliniussen.
RIM was supposed to unveil its new operating system last year, and Pliniussen noted RIM shares fell after Tuesday's announcement.
"Maybe there is a rabbit in their hat, but right now there's nothing in the hat," he said.
"Hopefully they can wave their magic wand and come up with something spellbinding."
This year's BlackBerry World conference began with a different tone than in the past. Once considered a victory lap for executives, it is now more about reaffirming the company's history and showing developers that RIM can still be an innovator.
The strategy comes amid questions about the future of the Canadian technology firm, which has been at the centre of takeover speculation for months.
In the past year the company's financial results have been pummelled, its PlayBook device launch fizzled, and it suffered the worst service outage in its history.
Sales of BlackBerry devices are also declining so much that the company stopped providing its own estimates last quarter citing the volatility of the market. At least some of the sales decline is likely due to the lack of new devices on the market from RIM.
Ahead of BlackBerry World, rumours swirled that the BlackBerry-maker would surprise the audience with a slate of new hardware, but the company has quashed those suggestions saying that it won't showcase the products until they are ready, sometime in the latter half of 2012.
Financial analysts are mostly absent from the conference, as RIM opted to hold a separate analyst event timed for the release of the BlackBerry 10 models later this year. In recent years the analyst and developer events were both held at the annual conference.
The PlayBook tablet, which was the BlackBerry maker's answer to the iPad, went on sale in April 2011. Since then, <a href="http://www.huffingtonpost.com/2012/01/03/blackberry-playbook-price-rim_n_1181167.html" target="_hplink">RIM has lost $485 million</a> on unsold units. At the beginning of January, <a href="http://www.huffingtonpost.com/2012/01/03/blackberry-playbook-price-rim_n_1181167.html" target="_hplink">RIM slashed the price of all models</a> of its tablet to $299. The special pricing will last until February 4. PlayBooks, which come in 16, 32 and 64 gigabyte models, typically retail for $499, $599 and $699, respectively, <a href="http://news.cnet.com/8301-1001_3-57351162-92/blackberry-playbook-price-now-$299-for-all-models/" target="_hplink">according to CNET</a>. In November, RIM temporarily <a href="http://www.huffingtonpost.com/2011/11/22/blackberry-playbook-price-drop_n_1107941.html" target="_hplink">slashed the price</a> of the 16GB version of the tablet to $199 at certain retail locations.
In October, BlackBerry <a href="http://www.huffingtonpost.com/2011/10/13/blackberry-outage-2011-rim-says-services-returning_n_1008596.html" target="_hplink">suffered an outage that affected</a> many of its then 70-million worldwide users, leaving some of its customers in Asia, Europe, Latin American and Africa without service for as many as three days. Some users in the U.S. were affected, but not for as long a period.
In December, two RIM executives were fired after a flight they were on was forced to be diverted because the pair's "drunken rowdiness," <a href="http://www.huffingtonpost.com/2011/12/02/two-men-face-hefty-fine-a_0_n_1125214.html" target="_hplink">the AP reports</a>.
Research in Motion announced in December 2011 that its highly anticipated BlackBerry 10 platform won't be available until the end of 2012. <a href="http://www.huffingtonpost.com/2011/12/16/blackberry-10-phones-rim_n_1153314.html" target="_hplink">According to the AP</a>, the company claims the holdup is because the chipset needed for the phones running the platform won't be available until the middle of this year.
In 2011, <a href="http://www.dailyfinance.com/quote/nasdaq/research-in-motion-limited-usa/rimm" target="_hplink">RIM's stock</a> dropped <a href="http://www.huffingtonpost.com/2012/01/23/rim-ceos-jim-balsillie-mike-lazaridis_n_1222605.html#s629929&title=Lessien" target="_hplink">a massive 75 percent</a>.
In less than a year, RIM's share of the U.S. smartphone market <a href="http://www.huffingtonpost.com/2012/01/23/rim-ceos-jim-balsillie-mike-lazaridis_n_1222605.html#s629929&title=Lessien" target="_hplink">dropped by almost 50 percent</a>, from <a href="http://www.comscore.com/Press_Events/Press_Releases/2011/3/comScore_Reports_January_2011_U.S._Mobile_Subscriber_Market_Share" target="_hplink">30.4 percent</a> in January 2011 to <a href="http://www.comscore.com/Press_Events/Press_Releases/2011/12/comScore_Reports_November_2011_U.S._Mobile_Subscriber_Market_Share" target="_hplink">16.6 percent</a> in November 2011. In 2009, <a href="http://www.huffingtonpost.com/2011/12/16/blackberry-10-phones-rim_n_1153314.html" target="_hplink">RIM controlled 44 percent</a> of the US smartphone market. (Pictured above is the HTC Desire HD Android, which runs on Google's much more popular Android platform.)
A nearly 75 percent drop in stock price in 2011 did not please investors. At the end of 2011, Jaguar Financial Corp, <a href="http://www.huffingtonpost.ca/2012/01/03/balsillie-lazaridis-rim-research-in-motion-jaguar-financial_n_1180885.html" target="_hplink">one of the largest investors</a> in RIM, called "for substantial corporate governance change and for a sale of RIM, whether as a whole or as separate parts." Vic Alboini, the chief executive of Jaguar Financial, <a href="http://www.bbc.co.uk/news/business-16393180" target="_hplink">told the BBC earlier this month</a> that RIM has "lost it." "The party is over, we believe, in terms of trying to design that cool, tech savvy smartphone," he said. "Microsoft has over $50 billion in cash, RIM has $1.5 billion. There is no way they'll be able to compete."
The family of 11-year-old Kian McCreath of Coventry, U.K., gave RIM some of its worst publicity in 2012, telling the media the boy was burned and left with permanent scarring when his BlackBerry Curve 9320 exploded. Although cell phones that are left to charge too long are known to explode, for RIM the news represented a horrible publicity disaster that came just weeks ahead of the launch of its BlackBerry 10.