With co-CEO Jim Balsillie Wednesday announcing that the company’s PlayBook tablet will be priced under $500, shares of BlackBerry maker Research In Motion (RIM) soared on the Toronto Stock Exchange and Wall Street.

RIM unveiled the PlayBook tablet in September to take on Apple’s iPad. It will hit the market early next year.

The price announcement sent RIM stock up 5.68 percent on the TSX to close at $58.61 and 7.53 percent up on Wall Street to close at $59.14.

Balsillie said in Seoul — where he is attending the G20 CEO summit — that the PlayBook tablet will be priced competitively below $500 to challenge Apple’s iPad which has sold millions of copies since its launch in April.

Apple sells iPad Wi-Fi-only for $499 and 3G iPad sells from $699 to $829.

BlackBerry’s PlayBook tablet will stand apart from Apple’s iPad for not only its size — it has a seven-inch display as against iPad’s 9.7 inches, but also its Adobe Flash for running video and graphic works. Apple has shunned Flash.

Even though RIM has posted 20 percent growth in the last quarter and is close to reaching 60 million BlackBerry subscribers worldwide, the outlook for the Canadian iconic company has been clouded as Apple has overtaken it in smart phone sales worldwide.

During the last quarter, Apple sold 14.1 million smart phones while RIM sold just 12.4 million BlackBerry smart phones.

According to IDC, a global IT research firm based in Massachusetts, Apple now controls 4.1 percent share of the global smart phone market, surpassing the BlackBerry’s share of 3.6 percent.

Worse still, both iPhone and Google Android devices have outsold the BlackBerry in the US smart phone market where it was the undisputed leader till now.

In fact, when Apple posted a 70-percent jump in quarterly profits last month, CEO Steve Jobs taunted RIM, saying, “We have now passed RIM, and I don’t see them catching up with us in the foreseeable feature. We are out to win this one.”

The taunt forced RIM co-CEO to retort, ” We think many customers are getting tired of being told what to think by Apple.”