Research In Motion's stock gyrations reflect investors' key concern, Is
the BlackBerry maker's new phone the company's savior or isn't it?
The spark
The company's critical new phone with the BlackBerry 10
operating system debuted Wednesday to mostly positive reviews. But the
phone won't come out in the United States, a key market, until March.
Investors
worried about RIM's future, had driven its stock to a nine-year low in
September. But hopes that the new phone will juice demand for
BlackBerrys and revive Research In Motion Ltd.'s fortunes have helped
shares more than double since then.
Shares dropped 83 cents, or 6 percent, to $12.95 on the Nasdaq Thursday afternoon.
The big picture
Pioneered in 1999, the BlackBerry was a game-changing
breakthrough in personal connectedness. It changed the culture by
allowing on-the-go business people to access wireless email. But the
iPhone's debut in 2007 showed that phones can do much more than email
and phone calls, and exploded RIM's market. The company's shares sank
for years as the BlackBerry lost ground to Apple Inc.'s iPhone and
phones running Google Inc.'s Android system.
RIM promised a new
system to catch up. But it has taken more than two years to unveil the
new phones, which are redesigned for the multimedia, Internet browsing
and apps experience that cellphone buyers now demand.
The first
device in the new crop of revamped BlackBerrys will be the Z10. It will
have only a touch-screen keyboard, like the iPhone and most phones
running Android, including Samsung Electronic Co.'s popular Galaxy line.
Although the Z10 will go on sale Thursday in the U.K. and next Tuesday
in Canada, it won't be available in the U.S. until March.
The Q10
will follow at least a month later, in some markets, and will have a
physical keyboard, a feature that has kept BlackBerry users loyal over
the years because it makes typing easier. RIM couldn't say when U.S.
carriers would have it.
The analysis
National Bank analyst Kris
Thompson said BlackBerry 10 launched with few surprises other than more
delays. The expected March launch in the U.S. for the Z10 is "very
disappointing," as U.S. business, consumer and government phone buyers
are the phone's most important market, Thompson said in a note. The
April debut for the Q10 disappointed him as well.
BGC Financial
analyst Colin Gillis said he doesn't think the phones will sell. By the
time the Z10 goes on sale in March, "you'll have a lot of talk about all
the new Android phones," Gillis said in an interview. "It's a decent
product. They will have some success. We all like it, but I wouldn't buy
one."
Sterne Agee analyst Shaw Wu suspects many investors are
convinced the new BlackBerrys aren't different enough to diminish the
popularity of the iPhone and Android devices.
Wu, who has a "Neutral" rating on the shares, said he was still concerned with RIM's "fundamentals."
BlackBerry 10 Launch: In pictures