RIM: Signs of rebound brewing?

Summary:Surprise! Google's Motorola Mobility purchase and new products make RIM look much better than it did just a week ago.

Research in Motion's latest BlackBerry devices have landed and the latest events in the wireless industry---notably Google's acquisition of Motorola---have helped the company's standing in short order.

First, BlackBerry has its long-awaited new product cycle rolling. ZDNet's Matthew Miller gives the latest BlackBerry devices---based on BlackBerry OS 7---a thumbs up and calls the line-up RIM's best effort. What about those QNX-based superphones that will give the BlackBerry 7 devices a short shelf life? Miller argues that the latest devices will be a good choice for at least a year.

CNET also gave the latest BlackBerry Torch on Sprint a solid review, but was mixed on the AT&T version.

Much needed product cycles aside, the real gain for RIM may come from disruption in the Android market. Google acquired Motorola for $12.5 billion in a deal that locks down patent protection for Android, but could alienate HTC and Samsung in the long run. Google said it will run Motorola independently and keep Android open source, but the devil will be in the details (see CNET News roundup).

Sterne Agee analyst Shaw Wu said that RIM can benefit from the Google-Motorola deal. Why? First, RIM becomes a lot more valuable as an acquisition target. Microsoft and HP would be potential buyers. However, Microsoft's acquisition of RIM would be a long shot given a partnership with Nokia.

Wu said in a research note

We believe RIM could benefit from potential disruption in the Android ecosystem as Google integrates its acquisition of Motorola Mobility and there could be a potential eruption of a civil war. In addition, from our conversations with carriers, they would love to see a stronger No. 3 supplier in mobile phones. And the reason is that many of them are growing concerned with the growing dominance of Google and Apple. We believe Windows Phone will benefit as well but RIM is arguably in a stronger position given its independence and incumbent position as the No. 3 player.

National Bank Financial also upgraded shares of RIM because the company is a takeover target and has a treasure trove of patents.

Wu still has his reservations about RIM's product cycle as well as transitions from the BlackBerry 7 operating system to QNX next year. Toss in concerns about bill of materials for RIM and there are significant questions.

Nevertheless, the ball seems to be bouncing RIM's way a bit. If the new BlackBerry devices get any traction, RIM's standing will improve dramatically from just a few weeks ago.

Related:

Topics: BlackBerry, Google, Mobility, Security

About

Larry Dignan is Editor in Chief of ZDNet and SmartPlanet as well as Editorial Director of ZDNet's sister site TechRepublic. He was most recently Executive Editor of News and Blogs at ZDNet. Prior to that he was executive news editor at eWeek and news editor at Baseline. He also served as the East Coast news editor and finance editor at CN... Full Bio

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