Research in Motion: Holding Its Own in the Face of iPhone Competition

Since Apple’s (AAPL) iPhone launch, Apple’s stock is up 55%, but Research in Motion's stock (RIMM) has matched the Apple performance almost exactly. RIMM is up 52% over the same period.

Basille on the iPhone Phenomenon

Jim Basille, the co-CEO of Research In Motion, may have said it best in the first quarter 2008 conference call June 28 (see conference call transcript). He said Apple had “drove attention to the converged [smartphone] appliance space”, a market where Research in Motion had already established “clear market leadership”. Apple has brought "a lot of attention to this space, its growing the space, it's validating extensions to the space”

Basille said:

The iPhone is launching, to the best of my knowledge in one carrier and one country and we're in about a 100 countries and 300 carriers, so to the extent there is interest there. There is another 109 countries that are interested in these kinds of things.

Now clearly Apple will move beyond its one carrier, one country launch. But we think the key takeaway is that Research in Motion has already done the groundwork to deal with multiple carriers globally.

Beyond the Input Mechanism: The Rimm Strategy

In response to a question about the Apple touchscreen (a comparison which Basille referred to as the “my input mechanism's funkier than your input mechanism” contest) he described the RIMM strategy as:

compelling user experience

aligned relationships with the carriers

extensive channel support and service support

application extension

We think this suggests that Research in Motion has a clear strategy and is not likely to wilt in the face of competition from Apple or anyone else.

RIMM 1-yr chart

Comments

[Julian Ivan...:]

Funny... in a 3 days, Apple sold 1M iPhones... more than RIMM usually sell in 3 months. That's in spite of Apple being on one network in one country, and RIMM on 300 networks in 100 countries.

Makes you think, doesn't it, when you look at it like that, Mr Basille.

2007 Jul 06 05:56 AM

[moosebump:]

Apple's expectations for the iPhone make RIMM look like a relative tortoise. RIMM is just about to ship its 20 millionth device after 10+ years. This would include a couple of upgrade cycles for early users.

Apple thinks it can do 10mm units by the end of 08!

2007 Jul 06 12:56 PM

[Sebhelyesfarku:]

RIM and Apple have different target groups, Blackberries for business people, iPhones are for Mactards and fashion lemmings.

2007 Jul 07 12:42 AM

[suznick:]

Kool user name; who are you hiding from? Blackberrys are for people in business who are tied to an Exchange server controlled by zealous IT folk. It is good for what it does; in fact it is the best. We accept that. But why do you need name calling to backup your argument? You make yourself look like a baffoon. Just realize that even with 20 millions units sold, Blackberry only has about 2% of telphone market. It is a firm leader in a very small, specialized part of the market. For the other 98% I suspect the needs do not match your.

2007 Jul 08 09:36 PM

[Hayweed:]

I found my old Palm VII the other day. Very cool back in the day. Now worthless. Remember when Palm was king. Rimm is the next tech to slowly die off. Their big focus is on email which every cell phone has or is getting.

2007 Jul 06 08:59 AM

[suznick:]

Blackberry (RIMM) is the best one trick pony in the business and is closely tethered to the Exchange server. It does its one job like no other. Together Blackberry and Exchange make a more than adequate dog and pony show. Most of the world wants far more than being tied and controlled by the whims and needs of corporate IT. For the rest of us, Blackberry is a very expensive and inadequate system.
Decide what task you want your hand-held communication device to accomplish and choose the best. If you choose one that doesn't help you accomplish that task, you chose wrong.
We are talking two very different universes today. Right now the overlap and competition is negligible. The future will probable be very different.
I am not tied to corporate IT controlled e-mail system, Blackberry offers me nothing.

2007 Jul 08 09:26 PM

[John Lazerow:]

There's plenty of business to go around for both Apple and RIM. Settle down folks and get long both.

2007 Jul 10 05:46 PM