RIM's PlayBook 2.0 software adds a built-in email function to the device, addressing what critics say was a major shortcoming of the original version, launched in April to scathing reviews.

"It's what the first Playbook software should have been from a company which stakes its brand on messaging strength, with tightly integrated calendar, email, and contacts," said Frost and Sullivan analyst Craig Cartier.

Before the upgrade, which came months after it was initially promised, a user would have to tether the tablet to a BlackBerry to get email or access calendar and contact applications.

FIRST TEST FOR HEINS

The botched PlayBook launch fueled growing investor pressure that culminated with a decision by RIM's co-chief executives Mike Lazaridis and Jim Balsillie to step down last month and hand over the reins to Thorsten Heins, a former Siemens AG executive who joined RIM back in late 2007.

The pair, who built the BlackBerry maker into a household name, weathered a storm of criticism in recent years as Apple's iPhone and iPad, and the army of devices powered by Google's Android system, eclipsed their email-focused BlackBerry.

How the PlayBook upgrade goes down with investors and analysts could set the tone for Heins' first year at the helm.

Tech websites mostly reacted with a dismissive shrug. TechCrunch said that "what RIM has done is effectively bring the PlayBook up to speed" with Android tablets. Gizmodo said it was "RIM's attempt to salvage the PlayBook" by giving it "basic tablet functionality."

The tablet, which RIM has discounted heavily to boost flagging sales, runs on the company's new QNX-based operating system and provides the blueprint for the first QNX-based BlackBerry, due out by the end of the year.

The Waterloo, Ontario-based company needs to have more QNX applications available before the new phones, powered by QNX software called BlackBerry 10, hit the market. It hopes the PlayBook upgrade will encourage developers to get started.

Analysts consider that crucial if the company that virtually invented the smartphone hopes to make up ground lost in recent years to Apple and Android.

"RIM appears to have re-positioned PlayBook from a standalone profit center at launch (at $499) to an investment to build and seed developer interest in its next-generation platform ahead of the launch of BlackBerry 10 later this year," RBC Capital Markets analyst Mike Abramsky said in a note to clients.

ANEMIC SALES

The free upgrade also gives the tablet the ability to run applications written for Android, a tacit acknowledgement by the company that the dearth of RIM-specific apps has limited its appeal.

RIM sold just 850,000 PlayBooks to the end of November. By comparison Apple sold 15.4 million iPad tablets in its latest quarter.

RIM said the upgrade would add thousands of apps to its store, which currently has far fewer than Apple and Android stores.

The PlayBook software update will also feature a new BlackBerry video store, initially only available in the United States, and enhanced web browsing capabilities.

But two important features are missing. The upgrade excludes the popular BlackBerry Messaging (BBM) application and it is unable to integrate with existing versions of RIM's enterprise server software. That gives it limited appeal to RIM's core audiences of business users and BBM fans, Abramsky said.

Shares of RIM, which have tumbled close to 80 percent over the last year, rose 1 percent to $15.21 on the Nasdaq on Tuesday.

(Editing by Frank McGurty)

• A Permanent Economic Emergency