RIM's future turns into analyst battleground

RIM's future turns into analyst battleground

Summary: Some analysts say that RIM's BlackBerry 10 platform is the real deal and will garner interest. Other observers see the OS as another WebOS.

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The opinion of Research in Motion's BlackBerry 10 devices and their success is becoming increasingly split among analysts. On one side are analysts who are relatively upbeat about BlackBerry 10 and those industry watchers that see the platform as doomed to fail.

This battleground over RIM is playing out almost daily. On Monday, CIBC analyst Todd Coupland said RIM shares are worth $17 a share. RIM is currently just below $12.

The catch here is that RIM shares have already had a great run---all based on BlackBerry 10 enthusiasm. Coupland said:

Details of BB10 are being leaked by carriers and developers alike. True multi-tasking with messaging and apps, one thumb navigation, swipe to type keyboard, improved speedy browser, competitive hardware, and 100,000 BB10 applications available on launch day are all encouraging to the “Productivity” and “Flow” vision RIM is looking to promote itself as and this should re-ignite Blackberry fan support. Early feedback has been generally positive. We believe the early reviews of BB10 devices are strong enough to keep and grow the current subscriber base.

Coupland's bottom line is that investors should buy RIM shares, which have nearly doubled in a few weeks. Also: BlackBerry 10 devices are almost here - but how will you manage them? | With BlackBerry 10, RIM must pull off its greatest trick yet | RIM preps enterprise roadshow, chafes at iPad Gartner prediction

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Coupland's note follows Jefferies analyst Peter Misek, who upgraded RIM to a hold from an underperform. Misek said:

Preliminary results from our quarterly handset survey indicate developed market carriers have a much more positive view of BB10 than we expected. With greater carrier shelf space and marketing support, we now believe BB10 has a 20%-30% probability of success. While the likelihood is low, the potential reward is high.

National Bank analyst Kris Thompson is also upbeat and has urged investors to buy RIM shares ahead of BlackBerry 10's launch.

And then there's the flip side of the RIM argument. Morgan Stanley analyst Ehud Gelblum said:

We continue to believe BB10 has a low chance of success. While some of the new features on BB10 seem innovative, we had a similar reaction to Palm’s WebOS when we saw it at CES in ‘09. Ultimately we believe BB10 is too late, and subs continue to shift to competitive devices.

Gelblum added that RIM will continue to lose enterprise subscribers.

Macquarie analyst Kevin Smithen sees RIM as a coin flip in many respects. Smithen added:

Our carrier checks indicate that North American carriers are each likely to take one or two BB10 devices and that the company is likely to benefit from channel fill in the February and possibly May quarters. Given low levels of RIM channel inventory, the company could post upside to our above-consensus 8 million smartphone units in the Feb. quarter. As a reminder, RIM sold 11.1 million units in the Feb. 2012 quarter with a stale product.

Topics: Mobility, BlackBerry, Smartphones

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13 comments
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  • Jury still out?

    We've reached rge stage that with every analyst, unless we know who their clients are, they have to be taken with a large pinch of salt. At the Facebook IPO, most analysts talked up the stock, but were employed by companies who, it transpired, were employed by Facebook. I've long been cycnical, but that was the day that "analysts" in tech truly jumped the shark.

    With these divergent views, we cannot really know, without knowing their paid loyalties (or lack of), though I strongly suspect that few of them are truly independent.

    The simple fact that I am first to post here tells us volumes about the geek vote, and I reckon that many consumers got sick of waiting and traded across to Android or iOS devices.

    There are still many crackberry addicts, especially in the UK, their last growth market, and brand loyalty matters. But it is unlikely that RIM will be converting many non-believers to their cause, however good the new device turns out to be.

    And if it isn't a perfect launch, RIM will go from a slow decline to a catastrophe overnight.

    Unlike Nokia, who have at least bottomed out, with the help of Microsft billions, RIM have no sugar daddy.

    The glass is more than half empty.
    Heenan73
    • BB10

      How do you know BB10 is unlikely to convert non believers? Do we all drive the same cars for the rest of our lives? Do we all wear the same style of suits, shirts and shoes all our life? Do we buy the same TV brand? You getting the message here? The majority of all consumers change from one brand to another for a variety of reasons. Smartphones are no different

      as for Nokia, they have a chance to recover but they have to compete against Samsung and HTC, I like RIM's chances better.
      HabsSuck
    • UK Crackberry addicts are kids with little money

      The 'Crackberry addicts' in the UK are Teenage kids, who historically paid their BES subscription over and above their measly call allowance, so they could send thousands or BBM messages and not get charged for exceeding their SMS allowance.

      The generation underneath them, that are not allowed phones as they are too young, are already flocking around iMessge on their iPod Touches. This will only increase with iPad Mini's gaining traction as a premium kids tablet, or similar Android solutions on cheap Android tabs and Kindle Fire.

      RIM are an irrelevance now, with the core business going to IOS/Android, and to a lesser extent Windows Phone. They will join WebOS, Symbiam and MeeGo in the bin.
      neil.postlethwaite
    • They don't need

      They don't need a sugar daddy, they have $2Billion in the bank and are debt free.
      Susan Antony
    • The UK?

      The UK is their last growth market? Come on. They are growing all throughout Asia and Africa. Not to mention Latin America.
      And do you think people are not switching between OSes now? Of course they are. I think BB10 with throw BlackBerry devices into that mix, and not just on the from side of the equation.
      Susan Antony
    • Heenan73 .. until this point

      i figured you were an intelligent, non-bandwagon kinda guy. Geez, did i misread that big time.

      BB10 will be head & shoulders above what iOS and even Android can bring as a total package, user experience. The RIM Dev's haven't been stuck in some time warped vacuum - and the doubters will want to eat their words when the rubber hits the asphalt.

      RIM are down, to be sure, they are far from out.
      thx-1138_
  • RIMs Mountain

    It has to climb the fact it has poor App support compared to IOS and Android.

    Don't buy RIM shares and expect to retire on them unless you want to live in a tent and eat beans in your final days.
    Alan Smithie
    • Investing 101

      don't put all your eggs in one basket, same goes with RIM Stock. It's a nice complimentary stock with a huge potential upside. Can you see it? Oh, are you wearing your iglasses?
      HabsSuck
  • WebOS vs RIM

    Where was WebOS' installed base prior to launch? RIM has had a pre-BB10 in the field with Playbook and has lots of companies with cash tied up in BES CALs it can't use elsewhere. Not saying RIM is going to do well but a comparison to WebOS is inapt.
    dowlingm
  • Too late

    I'm afraid that no matter how great BB10 is it won't be able to overcome the inertia that IOS and Android already have. I just turned in my BB for an iphone 4s this month. Our company is switching to Good from BES and only supplying the 4s. Even though the messaging of BB can't be beat, we caved to the executives who wanted cool.
    harrim47
    • Good isn't that great

      Good is good at one thing - separating and securing data. Usability and functionality is dreadful compared to a Blackberry tied to BES but users learn that the hard way.

      We had executives get sucked into the Apple vortex to find out it's not that great at messaging / PIM or simple phone calls.
      MobileAdmin
    • Past their prime

      No real innovation for over a year, NFC for iPhone in fall 2013 is laughable.

      5 year old OS's can't compete with a modern OS, they are not fine wines and don't get better with age, the difference will be striking and obvious when BB10 goes public, no tech savy hyper connected smartphone owner would stick with iOS and Andoid after test driving BB10 for 10 minutes, they will look like dinosaurs past their prime.
      pfezziwig
  • RIM campaign

    A couple years ago, the Blackberry was the only phone to pass Washington's safe security guidelines. The other companies, rather than improve the quality of their phones, went on campaign to discredit blackberry. They were quickly joined by Wall St who wanted to preserve the image of their big money makers.
    Big corporations don't rely on quality anymore. they just bully or beat the competition until they go under. Free enterprise is dead with big corporations.
    bhglennie@...