ThoughtPiece: RIM’s Perfect Position


Thought plays it like a grandma this week and makes a quilt of interesting news reports to comment on RIM’s current place in the market. Enjoy the insights that make you go “hmm”. Thanks Thought, as always, for putting things into perspective.

RIM’s Perfect Position

Mixed in with the news from the past few weeks, I came across these nuggets of information that together paint quite an interesting mosaic…

Cingular Wireless released its Q3 results and among the good news for Cingular, was this:

ARPU (Average Revenue Per User) from data services continued to grow robustly, increasing by 46 percent to $6.32 year-over-year and 10 percent sequentially.

Then there was this story that cited data from the respected research firm of Gartner:

Smart-phone sales have already increased by 75.5 percent in the last year to 37.4 million units, and will grow by a further 66 percent during 2006…

Finally, there’s this report, largely concerning Windows Mobile, where, buried at the end of the article, is this interesting bit:

RIM’s co-Chief Executive Mike Lazaridis said in a separate newspaper interview that the company aimed to keep doubling its number of users each year.
“It will certainly be difficult, but we have oriented our company towards this,” Lazaridis told Germany’s Welt am Sonntag in an interview published on Sunday.
Asked how big the market for mobile emails was, Lazaridis replied: “It’s huge, and we’re just at the beginning.”

So what does all this mean? It means, as Mike Lazaridis noted, that we are on the cusp of an explosion in the market for wireless data (something that this column discussed as the next revolution in wireless). To quote from another Gartner analysis, on the release of the Pearl:

“The current market for “push” wireless e-mail is small, with approximately 12 million users worldwide. But Gartner believes that by year-end 2016, all mobile phones will be shipped with wireless e-mail functions, effectively making all 2.4 billion phone users worldwide candidates for wireless e-mail use. RIM seeks to appeal to more potential users by offering lower-priced, fashion-oriented, feature-laden designs like the BlackBerry Pearl.”

So this also means that RIM is perfectly positioned to benefit from these trends, a fact reflected in their rapidly rising stock price. If RIM can continue to execute, the BlackBerry brand can be the market leader for years to come in this wireless data revolution. These are good times for RIM indeed.