RIM’s U.S. Market Share Losses Slow, But Challenges Persist

February 3rd, 2012 by Trefis Team
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Research In Motion

Research in Motion’s (NASDAQ:RIMM) worsening position in North America, especially in the U.S., continues to worry RIM shareholders. The company has struggled against Apple (NASDAQ:AAPL) and Google’s (NASDAQ:GOOG) Android ecosystem in the smartphone and tablet markets. There is a ray of hope though as ComScore recently reported that RIM’s market share losses in the U.S. smartphone market slowed down in December 2011. [1] The market share declined from 16.6% in November 2011 to 16.0% in December 2011, which was better than market share losses reported in previous months. [2]

Our $16.50 price estimate for RIM stock is about 3% below market price.

See our complete analysis of RIM here


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Challenges Abound for RIM

RIM is not only losing market share in the retail smartphone segment, but also in the corporate segment. Corporates were once considered to be RIM’s forte, but the rise of iOS devices in corporates is a clear sign of IT consumerization which means employees want to use the same devices at work that they use at home. A recent study by security firm Check Point suggests that Apple’s iOS has overtaken RIM’s BlackBerry in terms of popularity among corporates (Read Apple Passes RIM in Corporate Market as iPhone Love Spreads to Work).

The company is also suffering from a number of product issues and delays. RIM earlier announced the delay in the introduction of its new operating system, BlackBerry 10, which is now likely be released in late 2012, and it has already suffered a nine-month delay in getting e-mail to its PlayBook tablet.

But RIM Can Work its Way Out

If the slowdown in market share losses is a bright spot for RIM, comments from the new CEO should boost investor confidence. Last week, RIM’s newly appointed President and CEO, Thorsten Heins, asserted that the company will make a push to regain market share in North America through a variety of promotions with carriers that will include more than just discounts. [3] If RIM can devise strategies and implement them successfully to avoid large market share deterioration in the U.S. in the future, its fortunes may stand a chance of revival.

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Notes:
  1. comScore Reports December 2011 U.S. Mobile Subscriber Market Share, February 2nd, 2012 [↩]
  2. comScore Reports November 2011 U.S. Mobile Subscriber Market Share, December 29th, 2011 [↩]
  3. RIM’s Heins ‘Here to Fight’ for BlackBerry Revival Against Apple, Bloomberg, January 28th, 2012 [↩]