IHS Global Insight Perspective | |
Significance | Research In Motion (RIM) continues to post strong customer and revenue growth. |
Implications | The vendor cites strong sales in Latin America, Europe and Asia, and the popularity of the BlackBerry Torch smartphone. |
Outlook | RIM has also said that there is much customer excitement around the PlayBook, which it expects to launch in its first fiscal quarter of 2012. |
Research In Motion (RIM) has announced a 40% year-on-year increase in BlackBerry smartphone shipments, to 14.2 million, with similar revenue growth to US$5.5 billion in its fiscal third-quarter (Q3) results to 27 November 2010. During the quarter, devices accounted for 82% of revenues, services 15%, and software and other revenue 3%. At the end of the quarter, RIM had some 55 million BlackBerry accounts.
Over the past few weeks, RIM has been subjected to possible service bans in parts of Asia and the Middle East (see United Arab Emirates: 8 October 2010: U.A.E. Allows BlackBerry Ahead of Ban Deadline and Saudi Arabia: 11 August 2010: Saudi Arabia Drops BlackBerry Ban), verbal criticism from its largest competitor over its tablet ambitions (see World: 20 October 2010: RIM Talks Up PlayBook's Prospects) and evidence of growing competition in its core corporate segment (see World – United States: 5 November 2010: Moves by Dell and Banks Pose Challenge to RIM). However, it is holdings its own, having navigated most of its regulatory challenges and securing strong growth in Asia and, so it says, market acceptance of the BlackBerry Torch handset.
In a conference call, RIM’s co-chief executive Jim Balsillie said that some 48% of BlackBerry accounts are outside of the United States, and that it was the number one smartphone vendor in several Latin American and European markets including the United Kingdom—where it has seen a tripling of pre-paid smartphone accounts over the past year.
Outlook and Implications
- Competition Bound to Intensify: RIM has also been the subject of takeover speculation, mostly based around uncertainties as to whether it could hold off growing competition from Apple and Android-based devices in its core segment. While smartphone sales have boomed over the past year, there is, however, much more room for growth from several vendors including RIM. The Canadian vendor has not sat on its laurels, recently acquiring a screen design firm (see World: 5 November 2010: RIM Acquires Screen Design Firm). This followed a raft of other acquisitions: QNX, which has developed the operating system for the upcoming PlayBook; Cellmania, the mobile content company; Viigo, a specialist software developer that delivers syndicated content to mobile phones; and the browser developer Torch (see World: 12 April 2010: RIM Boosts In-Car Credentials with Acquisition of QNX Software Systems, 25 August 2010: RIM to Acquire Cellmania, 29 March 2010: RIM Acquires Content Reader App Developer and 25 August 2009: RIM Acquires Browser Developer Torch Mobile).
- PlayBook to Appear in First Fiscal Quarter of 2012: RIM is forecasting BlackBerry shipments of 14.5 million to 15 million BlackBerry shipments in its fourth fiscal quarter. Its tab, the PlayBook, will not launch in that quarter, but in the following one. While this will miss the festive-season buying period, Jim Balsillie has said that excitement for the 7-inch PlayBook is “overwhelming”, that companies were delaying purchases of competitors’ tablets for the PlayBook to appear, and that it had many content partnerships in place. These are very upbeat words, but perhaps are partly based on Samsung’s initial success with another 7-inch tablet, the Galaxy Tab.