RIM may be seeing a bright future, but nobody else does

RIM may be seeing a bright future, but nobody else does

RIM and BlackBerry have been the subject of a fair amount of media scrutiny lately, a lot of it centred around the newly launched BlackBerry PlayBook tablet.

The PlayBook has been criticised as unfinished and been roundly panned in reviews. Yet the harsher the complaints the more RIM's response has been near-blind optimism. The problem, with BlackBerry World kicking off today, is that nobody seems to be buying it.

In the past few weeks alone RIM co-CEO Mike Lazaridis has walked out of a BBC interview over security problems in India and the Middle East, the PlayBook has been taken apart in a succession of unflattering reviews and the company has been criticised for only having the Bold Touch lined up for its big BlackBerry World event this week.

RIM's response has been to embark on an aggressive publicity drive in which it has unfailingly painted a rosy image of the company's future. Both Lazaridis and his co-boss Jim Balsillie have spoken of their pride in the PlayBook and have shrugged off any and all criticisms as minor concerns.

“We feel fantastic about the future of the company and its prospects,” AllThingsD reports Balsillie as saying on Thursday in response to the latest rumbling of discontent – a not-unexpected first-quarter earnings warning.

It seems, though, that words can only do so much. RIM's shares fell more than 13% on Friday, dropping below $50 per share for the first time in six months.

And the words fired back in the company's direction from analysts seemingly tired of RIM's blind optimism will surely have hit a nerve.

“BlackBerry is a broken brand on its historical high-end user base, RIM is under attack on the corporate segment, and the company’s profitability premium to peers is at risk,” was the verdict delivered by Bernstein analyst Pierre Ferragu.

“We see management expectations for a rebound driven by the launch of the PlayBook and QNX-based phones as unreasonable. We expect little upside from the PlayBook given the fundamentals of the tablet market and by no means consider QNX a game changer.”

The PlayBook was also the target of Pacific Crest's James Faucette's ire: “while the company may be anticipating improving PlayBook sell-through in coming months, our latest sell-through checks indicate the opposite,” he wrote. “Additionally, we believe the slate of new products to be released in the second half of 2011 are unlikely to result in better share at the high end. We remain skeptical of the company’s ability to re-accelerate its earnings growth with its current roadmap.”

One of the few positives to emerge for the Canadian firm over the last year or so has been the growth in popularity of its BBM messaging service, which allows free messaging between BlackBerry users regardless of location around the globe, even those on pay-as-you-go deals.

But a spike in popularity at the low end of the consumer market might make for good press in some quarters, but hardly replaces crumbling revenues in the all-important enterprise market.

Add a comment

You don't need an account to comment. Just enter your email address. We'll keep it private.