RIM’s Struggles Continue Amid Issues, Product Delays

October 31st, 2011 by Trefis Team
11.98
Trefis
RIMM: Research In Motion logo
RIMM
Research In Motion

Research in Motion’s (NASDAQ:RIMM) recent spate of troubles started with the BlackBerry outage in which millions of BlackBerry users were left without the basic email and other messaging service. The problems with RIM and Apple (NASDAQ:AAPL) releasing iPhone 4S a few days back meant that RIM users have started to replace their BlackBerry phones with iPhone. This fact was revealed by Gazelle, an online tech product buyer, which said that the number of BlackBerry trades is up from its record highs earlier this month, citing an 80% increase last week. [1] The report also revealed that smartphones like the Samsung Galaxy S2 and Motorola Mobility’s (NYSE:MMI) Droid Bionic may also have been responsible for this trade in.

See our complete analysis for RIM stock here

The problems for RIM have continued since the outage.

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A few days back, RIM held its annual three-day Blackberry DevCon Conference for software developers in which it unveiled a brand new operating system for tablets and phones named the BBX OS. BBX will combine traditional BlackBerry features with the QNX operating system, which currently operates the company’s unsuccessful tablet computer, the BlackBerry PlayBook. However, RIM failed to shed any light on the more important details like when BBX will actually be available and how BBX differed significantly from previous plans to shift BlackBerry phones to QNX next year.

This week, RIM announced another set back in that it will delay the BlackBerry PlayBook OS 2.0 update until Feb 2012. [2] The delay shows that the company is facing serious challenges getting native apps such as email, BlackBerry Messenger and more working on the BlackBerry PlayBook.

Our $26 price estimate for RIM stock is about 25% above market price.

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Notes:
  1. BlackBerry Owners Flock to IPhone 4S in Record Numbers, Forbes citing Gazelle as the source, 27th October 2011 [↩]
  2. An Update on BlackBerry PlayBook OS 2.0, The official BlackBerry blog, 25th October, 2011 [↩]