Week 16



RIM will open the market tomorrow at $53.40 which is 26% above it’s lowest traded price ever ($42.53 – 52 week low). Shares of RIM have been astoundingly bearish, despite their bold market moves over the past year. RIM has been trading below their 10-day moving average of $54.77 on volume of 3 million shares. Analysts speculate that a short move will be placed on RIM shares entering this week, potentially driving prices lower than previous terms. Expect low trading numbers for the next couple of days.

Research in Motion is set to debut it’s PlayBook tablet this Tuesday April 19th. Analysts are still abuzz regarding all the reviews that have uncovered a slew of negatives about the tablet. Despite all of this negative press, RIM CEO’s are fairly optimistic about their position entering the tablet market. For the first time in the company’s ten year history in the smartphone industry, have they ventured outside of their comfort zone in order to appeal to new consumers and lock in their solid Enterprise and IT core.

RIM plans to manufacture 7 million tablets within the next “few” (I anticipate that means 6) quarters. Despite this astounding number, analysts still compare the tablet to the Motorola Xoom, which Deutsche Bank estimated sold 100,000 units within the first month (in line with Motorola’s projection of 50,000 during Q1) and projects it will sell 150,000 during Q2. Including the negative press, analysts don’t think the PlayBook will survive the first quarter and may in fact, flop. Though, unlike Motorola, BlackBerry has millions of devout consumers that will undoubtedly support this tablet; that is one thing RIM can surely rely on.

“RIM, which is debt-free and flush with more than $2-billion in cash, can certainly survive a failed product or two,”  states Omar Al Ekkad of the Globe and Mail. He is commenting on the optimism behind the doors at RIM 10 – Headquarters in Waterloo, Ontario , Canada.

“The worry is that if the PlayBook doesn’t catch on, it will further dent the market’s confidence in RIM’s ability to keep pace with the competition. It also wouldn’t augur well for its future smart phones, since the PlayBook’s operating system is the same one RIM intends to put in all of its new devices, starting next year.” Ekkad raises a valid point, but the one thing no one knows much about is how RIM plans on exploiting their acquisition, QNX, which maintains the BlackBerry Tablet OS and all it’s fluid inter-workings.

The problem is that no one truly understands the capabilities, the scalability, and the functionality of the operating system, despite countless number  of RIM and QNX mentions of certain applications where QNX was implemented – well outside of RIM and QNX of course. I have a strong feeling that once the PlayBook has survived the “break-in” period – a month or two worth of use and speculation under it’s belt – it can start to be seen as a respectable competitor. That’s the hope of most stock owners and consumers who are counting the days until they can get the PlayBook in hand and witness the power for themselves.

RIM Seeks Nortel Patents

Amidst all of this PlayBook launch chaos, RIM has been sitting in auction with several big players including Apple, Google, and Nokia for over 6,000 patents that were once owned by Nortel Networks. These patents have been valued at over $2 billion and can play a huge role in the advancement whichever company bids the most. Of course, RIM wants to make sure it outbids Silicon Valley giant, Google for the patents since it values the Canadian company’s history and wants to keep that within the borders of Canada.

Expect to see a lot of action on this in the coming weeks – and of course, this could all influence stock prices mid-week. Coupled with the PlayBook launch, this could be big news for RIM if things go their way. Read more at The Motley Fool.

More RIM Related Links

Sell RIMM Now – Adam Hartung: Growth Dealing With Market Shifts


RIMM Related News

Texas Instruments Earnings – Monday April 18, 2011

TI OMAP4430 1Gz Dual Core Processors are being used for the upcoming RIM BlackBerry PlayBook tablet computer and Texas Instruments couldn’t be any more thrilled. In addition to speculation that being featured in the PlayBook will only help the stock, TI plans to purchase National Semiconductor Corp. With earnings never below analysts expectations, Texas Instruments plans to “wow” Wall Street tomorrow. Read the TI Posting regarding this acquisition.