updated 12:15 pm EDT, Fri August 26, 2011
Analyst hears RIM may profit from carrier upset
RIM may see a bounce back in the market simply out of carrier worries of an Apple and Google duopoly, Sterne Agee analyst Shaw Wu learned on Friday. After talking to carriers, he heard that networks are worried about the "growing dominance" of Android and the iPhone and were sorely looking for a third option to keep competition up. With Nokia not due to ship its first Windows Phones until September, he said, the BlackBerry could benefit simply by being a well-established company with a recently revamped phone line.
The early phones were getting mixed to genuinely positive reviews which, while not as ideal as what Apple or Google received, was considerably better than the overall more hostile reviews for BlackBerry 6-era hardware. More devices like the just-shipped BlackBerry Curve 9360 would also help through the next three to six months. RIM's flagship, the Bold 9900, has been the best received of the group.
With the view that RIM had hit its floor, Wu broke from expectations and became one of the few analysts to recommend buying RIM stock. There was still a risk it would lose to Apple and Google, or that it would have to push prices down and skew more towards lower-end phones. The researcher saw that concern as already baked into the stock value and raised his target value to $35, up from the $28 it was at today.
RIM was once the preferred smartphone maker in North America and had the most prominent spot at most carriers. The company's inability to counter the iPhone with the Storm and original Bold, however, led to carriers eventually turning their backs and picking Android in hopes of a defense. Verizon deliberately timed the Motorola Droid's fall 2009 launch to overshadow the Storm2 and went from 80 percent of its smartphones being BlackBerrys to 20 percent or less.