Tag: analysisPage 2 of 5

Sprint to keep iDEN network


BlackBerry 8350iInteresting news for those that have been following Sprint’s recent troubles, or are simply awaiting the release of the BlackBerry 8350i. Yesterday, Sprint released a statement explaining that they will keep their customer-losing iDen network after efforts to sell it failed, outlining plans to rejuvenate the languishing Nextel brand.

“I don’t believe you can turn around Sprint Nextel without at least stabilizing the iDen network. Reaffirming their commitment could in and of itself certainly improve trends,” said Stifel Nicolaus analyst Chris King, noting that some iDen business customers may have been worried about the prospect of a sale.

Sprint also made a separate announcement yesterday, stating that the FCC had given it a waiver regarding its obligation to stop using certain airwaves where the iDen network risks interfering with public safety networks. Hopefully greater network coverage and a new BlackBerry in the 8350i will help Sprint turn things around.

|via Reuters|


BusinessWeek: BlackBerry Bold costs $169.41 to produce


BlackBerry Bold

Estimating how much any given smartphone costs to produce is always a interesting topic, because it allows industry analysts to guess at just how much money manufacturers are making off their devices. BusinessWeek is reporting that market research firm iSuppli has performed a ‘tear-down analysis’ of the BlackBerry Bold’s private parts and determined that the parts and materials used to make the Bold cost $158.16. With the added cost of assembly and testing, the final cost is $169.41.

“That’s a nice price,” says Charles Wolf, an analyst at Needham & Co. in New York. Assuming RIM sells the device to carriers at about $350, the component costs imply a gross margin of about 45%, in keeping with the gross margins on other RIM devices, he says. The cost estimates from iSuppli don’t include several expenses, including software, marketing, and shipping, and so don’t give a precise indication of the device’s margins.

In comparison, the estimated assembly cost for the BlackBerry Curve is $103, while the iPhone 3G came in at $174.33. If RIM can ever get the Bold launched on AT&T, they’ll be seeing a pretty good return, and a better margin than Apple’s making on the iPhone 3G.

(via BusinessWeek)


Americans want fun from their smartphones


mobile entertainment

Yesterday we reported that the majority of European businesspeople were unwilling to trade in their favored handset for mobile email access. Today we can tell you that 87.5% of U.S. smartphone users access entertainment content (i.e. games, music, video) from their devices according to a survey by Artificial Life. In addition, 33 percent of those surveyed use their phone for entertainment over any other purpose, including email, GPS and Internet browsing.

It’s been tossed around that RIM’s BlackBerry subscriber base is now growing at an equal 50-50 split between enterprise and prosumer, and with reports like this it’s easy to see why. Why I’m sure that the majority of BlackBerry Cool readers wouldn’t give up their email for anything, I’m interested in hearing how important entertainment is to you.

(via CN)


Seeking Alpha torn over RIM


RIM logo

It might just be a sign of where the economy is, but financial website SeekingAlpha has published two thoughtful, well written articles saying two completely different things about RIM’s future. First up is SA analyst Bapcha, who says that RIM is currently the cheapest growth stock:

Research In Motion (RIMM), the manufacturer of the (Bl/Cr)ackBerry, turned in some exemplary numbers. For the three months ended Aug 30, 2008 (RIM’s Q2, 2009), revenue was $2.58 billion, up 15% from $2.24 billion in the previous quarter and up 88% from $1.37 billion in the same quarter of last year. The revenue breakdown for the quarter was approximately 82% for devices, 13% for service, 3% for software and 2% for other revenue.

During the quarter, RIM shipped approximately 6.1 million devices, and grew their subscriber base by 2.6 Million. Awesome numbers. In fact, for fiscal 2009 [ending Feb 2009], top-line growth of 80% and a growth of 70% in EPS is at the low end of what the company thinks they can churn out [awesome]. For fiscal 2010 [March 2009 to Feb 2010], I think that a growth in revenues of 40% yoy and EPS of 35% yoy [assuming slightly lower gross margins moving forward] are for sure numbers that RIMM can deliver on.

However, fellow SA analyst Matt Stewart has prepared five reasons why RIM will continue to fall.

Five reasons RIM will continue to fall

European business users won’t change phone for email



In the wake of a global recession and sharp stock drop, these kind of reports can be great news for RIM. New market research conducted by Globo has reported that 65% of European business users aren’t ready to replace their handsets ‘just to have access to emails’, despite almost half of the sample (47%) stating a desire for Internet access via their mobile phone.

“Our research has found that a mobile device’s ‘look and feel’ ranks high in the selection process, and emotion is high on the agenda too,” commented Costis Papadimitrakopoulos, Founder and CEO of Globo. “We also know that for every person who would queue to be the first with the latest gadget, there is also another who wouldn’t change their service provider for anything.

Globo’s research found that just 8.6% were interested in the technical aspects, capabilities and functionality of a mobile device, while the majority were simply concerned about the handset’s user-interface, price, its battery life and network coverage.

(via CN)


RIM Stock Report: so-so Q2, future looks bright?


RIM 6 month stock chart

RIM will be releasing their Q2 financial report tomorrow, and you can expect full coverage on BlackBerry Cool. However, that doesn’t mean financial analysts can’t all make predictions today as to how RIM will perform tomorrow. SeekingAlpha has pulled together a great round up on what happened to RIM in Q2 and what Q3 should bring.

Although the company’s prospects are riding high with the release of its 3G BlackBerry Bold device and the recent announcement of the consumer-friendly BlackBerry Pearl Flip, RIM shares are trading about 50% below the 52-week high it reached back on June 19. The stock was changing hands at just above the C$101.50 mark at 11:30 am E.T.

Furthermore, analysts are expressing concern about how much impact the current financial crisis will have on RIM. They’re also worried about the delay in launching the BlackBerry Bold in the U.S., the company’s largest market.

Despite that rather grim perspective, many analysts remain hopeful that Q3 will be a big one for RIM.

Financial Analyst Predictions for RIM