Datapoints For The Blackberry Faithful

by StockJockey

Thursday, August 14, 2008 - 10:31 am

I try to bring an open mind to the 9:30 open each and every trading day, have been slowly warming up to Apple’s stock versus Research in Motion (RIMM-NASDAQ). But my Apple thesis, which was neatly summarized in a recent note by UBS, is a longer term proposition.

RIM has plenty of near-term momentum given their superior distribution and pending product introductions. And the near-term competitive threat is overstated; Mactards can continue to dream about Apple displacing RIM from the enterprise market...nibbling around the edges is not a displacement and they need to wake up.

Avian Research’s handset analyst has been making the rounds, and I embargoed this for a day to give their clients a chance to chew it over. I don’t necessarily love the stock here, and am more entertained by the possibility of Apple busting a move to $190.

But somebody has to counter the stream of worthless, Apple biased commentary from bloggers who haven’t a clue, a lonely task indeed.

RIMM Recent Notes

Products

* Bold – 3G full-QWERTY… Update for 8800 Series – bigger, more enterprise focused

+ Still hearing launch throughout August and September with AT&T, Vodafone, and O2 sell-in to begin in early September.

+ Has launched at T-Mobile in Austria and Germany as well as Claro in Chile, Optus in Australia, and PCCW in Hong Kong. Expected mid-August at Carphone Warehouse and “coming soon” to Rogers Canada.

+ Likely a $249.99 initial price point at AT&T net of subsidies

* Thunder – Touch Screen

+ October 13th launch at Verizon per Boy Genius, consistent with our prior expectations for early 4Q08 launch
+ Unsure of timing of Vodafone launch – guessing November
+ Likely at $199.99 initial price point at Verizon net of subsidies

* Kickstart – Clamshell (similar to Pearl, but clamshell)

+ Still expect September launch at T-Mobile
+ Likely $49.99 initial price point new of subsidies

* Javelin – 2.5G full-QWERTY… Update to Curve… more consumer focused

+ Still hope for mid-to-late 4Q08 release at T-Mobile and/or Rogers, but could slip into 1Q09
+ Niagra (CDMA Javelin) still looking like 2Q09 release

* Other rumored devices –

+ Slider form-factor device (1H09)
+ 3G Pearl (1H09)

Momentum

* Verizon –

+ Likely the strongest of the major RIMM carriers – seeing strong sub adds based on popularity of Curve coupled with recently discounted prices on Curve ($99.99 from $149.99), Pearl ($79.99 from $99.99), and 8830 ($149.99 from $199.99). Verizon pushing RIMM devices in SMB channel. Expect strong Q/Q uptick in subs and units.

* T-Mobile –

+ RIMM continues to dominate T-Mobile smartphone category. Expect Q/Q uptick in subs and units.

* Sprint –

+ Believe RIMM came into quarter with very strong June based on strong Curve sales. However, competition from Instinct coupled with Curve out-of-stocks may have slowed momentum. Expect modest Q/Q uptick in units and subs.

* AT&T -

+ We believe AT&T was very strong June and first 2 weeks of July. As expected, iPhone competition coupled with Curve price-point reset to $149.99 from $99.99 likely weighed on momentum at AT&T. Expect flattish Q/Q unit and sub growth.

* International and product in channel likely to drive balance of subscriber adds.

+ Checks with European stores suggest continued pick-up in RIMM popularity. 3G capability of Bold device coupled with marketing/branding push in EU should accelerate growth in region.

Other Notes

* RIMM management well aware of investor concerns over spending. In conversations they brought it up several times which hopefully means they are managing this matrix.

Of course, if the Instinct can slow the Curve, I shudder to think what the iPhone 3G can do! But RIM can assure they beat the numbers by slowing the marketing spend...ever so slightly.
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RIMM leads over the past month, AAPL hold slight lead over 3 months. Its neck and neck

one month chart

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