RIM Disappoints, Or Does It?

It looks like even Research in Motion is being dragged down into the abyss of the financial meltdown (oh, did I mention Washington Mutual is the latest to go under?). Earnings for the Q2’09 were released earlier this evening and with the lowered margins and earnings forecast, the stock got a 20% haircut, down to $78.60US in after hours trading. I’ll point out why I think the sell-off was way overdone and why I think it’s a good time to buy.

First off, the big worry is the headline 47% gross margin forecast for the next quarter, which is a pretty big drop from the 51.3% last year and 50.7% in the most recent quarter. I’ll be blunt. Up to this point, and to and extent even now, it’s been easy sales and money for Research in Motion. In the business crowd that has been RIM’s core market for many years, there simply isn’t another option. There are certainly a few iPhones here and there amongst business users, but now more than ever I see the prevalence of the BlackBerry as I take my morning walk to work. There’s no comparison. It’s almost as if every decently dressed person is holding a BlackBerry.

With 3G devices becoming more prevalent, RIM will certainly face higher component prices. In addition, with the touchscreen Storm/Thunder looming, there are other more expensive components adding to the overall cost. But RIM still has pricing power. Many predicted that the Bold would come in at a lower price than usual to compete against the iPhone 3G, but it didn’t. Yet they still sell out at Rogers. The push towards the consumer market has meant lower average sale prices, but that’s with the result of vastly higher sales numbers. As stated in the earnings report, top line growth is expected to be even better than analysts expect, $2.95B to $3.1B for the next quarter, versus consensus of $2.9B. Sales aren’t the problem.

That’s why I found it hilarious that Jim Goldman wrote something of a self-confirmation article, entitled ‘Apple IS the Issue at RIM‘, regarding RIM’s earnings report. The premise of the article is that the nearly $380 million in sales and marketing expenses combined with the weak earnings forecast shows that RIM is struggling to compete against the iPhone. He also goes on to state that the $380 million figure was ‘an enormous figure no one was counting on‘. Wrong. RIM has clearly been putting more efforts into targeting the BlackBerry at non-business users. This past quarter, RIM launched the multimillion dollar ‘Life on BlackBerry‘ campaign, and for the first time, I’ve been seeing BlackBerry commercials on TV. Given that the sales and marketing expense for the first quarter was already at nearly $330 million, I don’t think $380 million was such a shock to most, well, except Mr. Goldman it would seem. RIM is expanding its brand outside of business. Surprisingly, many classmates I’ve talked to actually want a BlackBerry more than an iPhone. That’s saying a heck of a lot. The visibility is working.

I’m happy to see RIM increase its marketing efforts and expenses, as long as its growing sales at a proportionate rate, which it is. Margins will no doubt will be pressured by lower ASPs to the precise market they’re targeting, but sales growth is very resilient, even in light of the current economic troubles. At under $80, we’re talking about a sub-20 P/E, rapid-growth company. It looks like speculators pushing the stock rather than fundamentals, and I believe one Warren Buffet has made a killing investing in irrationally beat down companies.

BlackBerry Bold – Brief Hands On Impressions

One of the joys of going to school in Waterloo, home of Research in Motion, is the opportunity to see just about every new BlackBerry device before they’re publicly available. A couple days ago, I finally got my hands on a BlackBerry Bold. I only had a few minutes with it, but I was able to test out most of the defining feature differences in the Bold. If you’re looking for a detailed breakdown and review with tons of photos, I’ll unhesitatingly point you to CrackBerry.com. However, if you’re looking for another person’s impressions, read on.

Upon holding the device, the two most obvious differences from the Curve are the display and the width. I use a Curve and after handling both of them, one after another, I felt that the Bold was distinctly wider. That’s not necessarily a bad thing; I had no trouble holding onto the device. One handed operation may be slightly more difficult (I can reach the opposite side of the Curve with my thumb without issue, but the added 5mm or so could make a difference).

Of all the mobile devices I’ve used, the Bold’s display is most comparable to the iPhone’s in quality. The display is much closer to the protective covering over it than most devices, making the screen look more like an image than an actual display. The iPhone’s display also has this effect. Furthermore, the higher screen resolution (480×320) is evident even in the menu. Don’t expect anything too fancy in terms of the OS. Option menus are still mainly text-based.

I was a bit worried about the Bold’s keypad when I first saw leaked images. After hearing horror stories about the BlackBerry 8800’s keypad, I expected the worst from the Bold. However, after punching out a couple lines of text on the device, I come away with the opinion that either 8800 users were grossly exaggerating the issue or the Bold’s keypad is not like the 8800’s at all. If anything, I liked it a bit more than my Curve’s keypad. The grouped keys don’t exhibit the slight wiggle of the Curve’s keys. Additionally, both the trackball’s and keys’ presses are a bit more cushioned than with the Curve. Where there’s a distinct ‘click’ with the Curve, the Bold’s feels more refined and firm. I like it. The call, menu, back, and end buttons are also much improved from the small-ish size on the Curve.

I didn’t get a chance to try out the browser, but I was told that it features a significantly improved browsing experience. As well, navigating through the menu and starting/switching applications felt snappier. I didn’t see any loading animations andร‚ย  starting the camera module took only about a second. The device itself also felt very solid. There were absolutely no creaks in the casing (it had a smooth battery cover, not the advertised ‘pleather’ pattern), despite being a pre-production unit. The 8800/Curve was a big styling step from the 8700 series and prior models and the Bold takes it to the next level.

So, what’s the final word? I’m seriously considering an upgrade from my Curve to the Bold. Throwing together the significantly improved display, faster processor, and new OS, the Bold is a significant change over the Curve, despite being of a similar form factor. Anyone looking for a well taken care of BlackBerry 8310? ๐Ÿ˜‰

BlackBerry Precision Theme

If you’re itching for the new BlackBerry 9000, but rock a Pearl, Curve or 8800 instead, eVeek is providing a nice port of the Precision theme. Perhaps it’ll make the wait for the Bold just a bit more manageable. It now adorns my 8310 and I’m very happy with the design.

BlackBerry 9000 Bold Launched. I Want.

Research in Motion is my equivalent of Apple for most other people. I attentively read all the news and gossip that appear about rumoured devices and although their product line isn’t quite as varied as Apple’s, it just makes those product announcements all the more sweet.

So after reading several indepth reviews of the BlackBerry 9000 over at CrackBerry.com, I was getting mighty excited for the launch of the BlackBerry Bold today at WES2008.

Overall feeling? I want. Now, how can I justify one after only a couple months with the Curve…?

Update: Okay, a couple people (real life as opposed to web) have asked me why I’d want to upgrade from a Curve. Well, for me, it’s a combination of the much higher resolution display (hands-on opinions of the display have been phenomenal), new OS4.6, which includes a significantly improved web browser and probably HTML email support, improved performance, and Wi-Fi.

Aboard the BlackBerry Train – Curve 8310

While I was sick in bed, with no word from Sony Ericsson regarding the status of a repair for my K790a, I dug around on eBay for BlackBerries. After following a few items to completion, I realized that purchasing BlackBerries on eBay was not much cheaper than buying it in-store locally and ran the risk of being dinged by duties and customs fees, as the majority were from the United States. Most recently, I had the opportunity to pay over $35 in duties and fees for a $25 copy of Pzziz. That’s left a sour taste in my mouth for international purchases.

So after some research, I ended up with a new unlocked BlackBerry 8310, purchased from SN Traders. My questions about the device were answered promptly and service was very satisfactory.

BlackBerry 8310 Curve Trackball

In a sentence, I am extremely pleased with my purchase. The side effect, paying Rogers more for BlackBerry service, I’m less pleased with, but that’s a bit unavoidable. I didn’t know what I was missing when I bought the non-QWERTY keypad Sony Ericsson K790a. The BlackBerry’s an absolute joy to use and I’m able to jot down notes of thoughts I’ve had for further musing, at a later time. Did I mention it’s one sweet looking device too?

BlackBerry 8310 Curve

Predictive text tools, like T9, are nice ways of making it less painful to type alphabetic messages on a number keypad, but it’s no where close to replacing the ease and flexibility of a full QWERTY keypad. The keypad on the Curve is very easy to use, and I’ve had no trouble adapting to the small keys.

BlackBerry 8310 Curve Keypad

For a long time, I remember reading that holding a BlackBerry up to your ear was akin to holding a piece of toast, due to its width. That may have been true in the days of the 7200 series and older models, but with the Curve, it’s nowhere near as uncomfortable. For certain, it’ll feel wider than just about any feature phone, but given the no-compromise QWERTY keypad, it’s about as narrow as its going to get. At 60mm wide, it’s 13mm wider than my K790a, but with its decrease in thickness (15.5mm versus 22mm), it fits into a pants pocket a bit more readily.

BlackBerry 8310 Curve versus Sony Ericsson K790a
BlackBerry 8310 Curve

I’m glad for the Curve’s use of standard ports. For charging and data transfer, a standard mini USB port is used and for wired connectivity, a 3.5mm headphone jack is provided. Couple that with a microSD card slot (which is unfortunately wedged behind the battery) and the BlackBerry Curve can serve your multimedia needs as well. I have a microSDHC 4GB card installed and working without a problem.

The inclusion of the multimedia console, which allows access to music, videos, ringtones and pictures all in one place is a nice touch, but the lack of dedicated media keys means navigation in that application is a bit clumsy. If you want to skip a track, you have to bring up the menu using the menu key and then select previous or next track. Although you can start a slideshow of pictures, navigating them manually also requires bringing up the menu. UPDATE: I should’ve read the manual before I wrote – there are a wide range of shortcut keys that can be used to navigate in the media player – for example, N for next track or P for previous.

BlackBerry 8310 Curve Media Center
BlackBerry 8310 Curve music player

One of the things I’ve been using the BlackBerry for is text messaging and I really like the threaded messaging feature of the built-in messaging application.ร‚ย  It’s very nice to be able to see what you were responding to at a glance.

One knock against the BlackBerry – the OS is not pretty. Coming from my Sony Ericsson, which had a very graphical system, the BlackBerry focuses on function over form, with page after page of text menus at times. If RIM really wants to break into the consumer market in a big way (and not just target the prosumer group) they’ll really have to do some revamping of the software stack. Most business users probably prefer the functional nature of the OS, but with Joe or Jill Smith gazing at the device sitting next to a Sony Ericsson, I think they’d be swayed to the SE based on the looks alone.

With that said, I’m more than willing to deal with text menus in return for all the advantages the device brings. I’ve found battery life to be very good. With the push BIS enabled, a few calls here and there, and some texting, I can use the device for 4 days without fear of running out of battery power. Add a couple hours of music each day and you’ll probably want to charge the Curve every second or third day to ensure you don’t run out of power midday.

It’s now been two weeks with the BlackBerry and it’s holding up very nicely. The organizational features have come in handy over the last couple of busy weeks. I’ll soon be coming into a proper case for the Curve – the holster I have now was designed for the BlackBerry 7100 series, so doesn’t fit quite right. CrackBerry addict? Not quite, but progressing nicely I’d say. ๐Ÿ˜‰