It’s nice to see BlackBerry back in motion

BlackBerry
By Chris Umiastowski on 20 Jan 2013 02:26 pm EST
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As I write this, Kevin, Adam, Bla1ze, and Simon have either just arrived or en route to Toronto, which will be ground zero for CrackBerry HQ as we work up to the launch of BlackBerry 10.

So the timing seems right to talk about the huge comeback that BlackBerry and parent company Research In Motion are making. And I'm talking about both on the stock market and in the media. The stock market is often thought of as a predictor of the future, whereas the media is usually all about reporting what already happened. So for RIM to be scoring in both camps is a nice change of pace for CrackBerry Nation.

Let's look at the stock market first. RIM stock hit lows in the mid $6 range back in September and October. Ever since, the stock has been climbing in a huge way. It hit $14 before announcing its latest quarterly results, briefly fell back down on service revenue concerns, but quickly recovered and hit new highs. This past week has been another good one for shareholders, as RIM trades at almost $16 now.

Why did the stock drop so hard in the first place? Because investors have been worried, and I mean really worried, about the pending death of BlackBerry. The brand has been bleeding subscribers in the US market, discounting hardware, losing money on the income statement, laying off staff, and feeling carrier pressure on service revenues. If you wanted to write something purely negative on RIM, there was no shortage of material.

Over the last couple of months we've seen a lot of big progress on BlackBerry 10. We're seeing more optimistic headlines in the media. We're seeing developers pour thousands of new apps into BlackBerry World. The new CMO, Frank Boulben, was quoted by FierceWireless as saying BlackBerry 10 will support roughly 90% of the top 600 apps in major markets. Presumably he means apps that exist on Android and iOS.

This is all very good news. We are getting really close to the launch of BlackBerry 10. Canadian carriers have already had to increase their pre-order volume because they've sold out. We know the new hardware will sport a higher sticker price, enabling RIM to make money on handsets again. All of this will help the financials.

Yet analyst estimates for fiscal 2014 (ends February) haven't really changed that much. 3 months ago the average EPS estimate was a loss of $0.54. Today it sits at that same value. The stock has experienced a huge rally but analysts still have to follow through with estimate changes. Either that, or the stock has a long way to fall if BB10 ends up being a fizzle rather than the huge recovery we think it's shaping up to be. Obviously it all comes down to sales, which we'll have to wait to see. My point is this - there's a huge disconnect between the current stock price and the analyst estimates for next year.

If the media headlines are any indication, the sales are going to be there. The media moves in a pack, and it's pretty clear that RIM isn't getting kicked in the gut anymore. They're being praised, congratulated, and cheered for.

The stars seem to be aligning for RIM. Remember how they had to delay the launch of BlackBerry 10 to this quarter? What if it came out in the fall as was previously expected? It would have been buried under news. Though unrelated to tech, events like the U.S. Presidential race and Hurricane Sandy absolutely consumed the media, especially in the United States. Both the iPad Mini and Windows Phone 8 launched in this time period, and both received less than would be expected attention from the mainstream media. Had BlackBerry 10 launched then too, it likely would have been in the same camp. Maybe this delay was a blessing in disguise? There is virtually nothing happening in terms of competitive rollouts right now.  Even CES was quiet on the the mobile front. BlackBerry 10 has the headlines all to themselves.

Remember when pundits said that BlackBerry 10 would be too late? Even Windows Phone 8 would beat it to market, meaning that RIM would have no chance. Hmm, how did that work out? Windows Phone is getting practically no attention at all despite all of Microsoft's advertising bucks. Over the past two weeks carriers have become very vocal about their support for BlackBerry 10, and leaks are confirming that this will be a well-supported by carriers globally. The inability of Windows Phone to gain traction is a benefit to BlackBerry.

I was talking with Kevin yesterday before he jumped on the plane to Toronto. He told me something that I found interesting. Several big news outlets have been contacting him recently. Usually they'll contact him for interviews or quotes. But this time they just want to make sure they understand what's happening because they know they'll need to write about it. They're calling to get educated.

When was the last time the media was busy preparing themselves to write about a good news story on RIM? I honestly can't remember. It seems like so long ago.

How about I end this post by congratulating everyone at RIM. There were layoffs, and there were people who quit for what they saw as greener pastures. But most of you loyal employees have stuck with BlackBerry and done a lot of hard work to get to this point. You didn't throw in the towel. Things got ugly for a while. But now I can only imagine it's come full circle. RIM is a fun place to work again.

We are SO ready for your comeback, BlackBerry.

Reader comments

It’s nice to see BlackBerry back in motion

125 Comments

lol .... can I come too?

Nice write up Chris. Straight, and to the point.

I think that the U.S. media has no clue about RIM. On Monday, Cramer said that the new BB10 wasn't selling as well as the iPhone. It was so funny to hear this seeing that BB10 hasn't even been launched yet.

Then he corrected himself and said that this was maybe because it just recently came out.

Can you please have Kevin straighten the US out? PLEASE.

And what time is the showing?

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Posted by Jimcmf
"I think that the U.S. media has no clue about RIM."

i completely agree,,, there is some Rimcitement on some of the techie sites/mags but they need to get on the television,,, i suggested in another thread here that they should get out there NOW via the playoffs on tv here in the U.S. thus getting millions of eyes on,,, the general public here is clueless as affirmed by the numerous posts by cb'ers about interactions w/ friends & carrier reps,,, the more i thought about the idea of getting playoff ad time, (i posted a comment earlier today), the more of a great idea it was/is, if i do say so myself,,, that kind of airtime doesn't come cheap, but they've already stated they're going to spend $$$ on marketing,,, sooo, just moments ago what do i see??? a SAMSUNG SII/NOTE 2 commercial shooting for the business/security demographic!!! guess it was/is a great idea,,, & i got the feeling that Rim may still be asleep @ the wheel,,, food for thought,,, if you guys in Toronto could put a bug in their ear, it would probably do some good,,, i feel this was a big misstep to lose the opportunity to get the word out...

"THE GUY YOUR MOTHER WARNED YOU ABOUT"

Assuming the carriers in the u.s. are their usual slack selves, throwing out money now would be an utter waste because they might be a month away from launching devices.

Ramping things up from the launch onwards is far more sensible in the states as devices will be out elsewhere and there will be less of a gap between the adverts and availability too.

I felt sick and upset watching that same commercial and thought, WOW...getting tired of seeing everyone else's product phone commercial. Even during the Super Bowl would be late and after official launch....but something. Would've been great to see a BB10 commercial yesterday during either or both games!!!! Even today during news coverage of the Presidential Inauguration....something to surprise the nation of loyal users.

This is part of the reason that I urge caution in proclaiming the resurgence of Research In Motion and the BlackBerry brand. People on this forum get all giddy and behave like love-struck teenage girls drooling over Justin Brieber. Most people have written-off BlackBerry and without advertising beginning only a week ahead of the official launch event for BlackBerry 10, people still have no idea the BlackBerry Z10 exists. TIP: If nobody knows your product exists they are not going to magically buy it.

Nicely put, Chris. I believe everyone who decided to stick around will very happy in a few days.

Yes I would also like to know since that seems like a lot for the Canadian market. Also I think the term pre orders is a bit misleading. We are talking about the initial carrier orders I presume.

People will be smashing their iPhones and Androids on the cement once BB10 arrives.

They will need a replacement ...... enter BB10.

I think the poster meant GLOBAL pre-orders, not just Canadian pre-orders.

I have not heard anything about a couple million pre-orders, but a while ago I did hear 600,000. If a couple million pre-orders globally is correct, that's AWSOME!!!

"After digging around, Jefferies has found that the build numbers for BlackBerry 10 have been raised sharply from the 500,000 per month figure that was leaked in early December. The latest research shows that RIM now plans on building 1 to 2 million units a month."

http://bit.ly/10EAMdK

Where did you hear that ? I thought that was rumor. no nums released about pre-sold, current waiting list # is 3000 for rogers..same goes for others. can you please confirm/share this ?

Chris wrote: Canadian carriers have already had to increase their pre-order volume because they've sold out.

I find this sentence a bit misleading as the carriers do not have phones in their possession, they are simply making a list of people who may be interested in getting a BB10 phone, and who are willing to pay $40 up front. I don't see how they can sell out.

The link provided to Phone Arena has the numbers noted below related to RIM increasing monthly production from 500K to 1 to 2M, but the source story on BGR does not have that info.

I see so much excitement for BB10, and a lot of the interest is coming from other folks that are not fanboys. I see a dead drop grand slam in the making.

Everyone likes an underdog comeback story. I hope rim does it! Personally I'm hoping for a microsoft and rim take 1 and 2... But maybe I'm just wierd. :p

I have been texting with a cousin of mine for the past 30 minutes. He is a die hard Apple fan and even he is excited at the things that RIM will be announcing on the 30th.

I'm a relative newcomer to the Blackberry world, having started a little over four years ago with the Storm 1, which I still have, and then two PlayBooks. I can't tell you how thrilled I am with the way BB10 is progressing, and the Z10 phone, which as far as I can see is a damn near perfect device. I've told my carrier of 20 years Vodafone here in the UK that I want one the moment they are available, even though they are not listing it yet.

As a business person with a keen interest and stake in marketing and selling things, watching RIM's resurgence is incredibly exciting, and it may well come to be seen as as the biggest IT comeback since Apple arose from the near-dead many years ago. Let us hope and pray that everything goes according to plan!

Thanks Chris. Good article. Can I get a shout out for being one of the people consistently bullish on the stock even it was down in the 6's? Haha just kidding but it feels good to see this comeback and hopefully the momentum can continue. I think the 30s are possible if BB10 sells well this year, and the 20s are coming if it just keeps up with the BB7 sales numbers from last year

Many of us knew back Dec 20 -Dec 24 the service rev anti-RIM pile on was bogus and nothing more than a scam Imho to steal shares cheap, good to see you changed your tune now Umi, just like so many other analysts.

At a time when RIM was/technically still is losing money on hardware, services revenus are an incredibly valid point. They only have a few revenue streams, and to lose one or have it shrunk significantly, is still a concern of mine as an investor.

- Spades

You are 100% correct, which is why it was so important when Thorsten followed up his comments on service revenues with an explicit material positive statement - on the record - that service revenues aren't going away. Any suggestions otherwise were in direct contradiction to what the CEO (who should know more than anyone and is prevented by law from making deliberate material mis-statements) said. You don’t have to look far to see how Thorsten's comment was either overlooked, trivialised, or re-interpreted in favour of presenting a more bearish speculation on what the future may have in store for RIM. In other words the supposed reason for the sell-off was a sham.

Umm, did you not see the Visa announcement. RIM provides backend security for ALL NFC transactions. Every device will have to use it. No alternatives. 4 cents per transaction, 24/7. Big, Big dollars my friend. And them, there is RIM's BES inclusion of Apple and android devices to their servers. Holy crap. 75 to 120 dollars per device. And then the latest rumor that clearly HASN'T been denied by RIM that the new BBM can can extended to all devices on BES. Jackpot. The start of a unified communications platform. No more bull**** Apps that only work 50 percent of the time.

Im all for Blackberry making a huge comeback so dont take this question wrong. Im just wondering how many ppl are going to cancel their preorders when they find out how high the new BB10 devices or device launched on the 30th is going to be ? Ive heard rumours of a $700 pricetag, while I also hear alot of ppl saying they would never pay that much for the device that is expected. This worries me for Blackberrys future.
Either way Ill have my BB10 device in hand soon after launch giving them my support for sure. - KID ANDROID (Team Android Canada)

In other words, the MSRP is deliberately set artificially high well above its real marketplace value to fool people. The BlackBerry Z10 is worth CAD/USD250.00 off-contract. Period.

At first I posted a reply here wondering if Samsung would license BB10. But I just saw the new Samsung commercial going after Blackberry so I had to edit a complete change.

Who knew - Samsung is concerned about BB10!!

Look out - BB10 is coming soon!

always enjoyed Chri's articles. He is precise almost every time. Lots of positiving information, news lately. I have been checking ariticles, tweets, etc. and it is nothing but positive. The only negative I came acrosss is people who still thinks RIM is that old RIM and mis-informed. Some people still think that it will be like playbook. My estimates is that RIM will beat Nokia of selling 3-4 million units in first 3 monhts, over 2 weeks as not all carriers will release at the same time..if they do so. 1 million in fist week. Based on 6-10 million units in first 6 months after release the stock is worth over $20. Some analyst saying that rim needs to sell 6 mil to make the stock worth $20 bucks, more than 10 mil should be over $30. A dream but selling over 50 milion in 2013 would be killing..some of crackberry fans should be millioner. Even futureshop iFreaks praising BB10.

The fashionable "new" take is to say how RIMM and PALM stock have the same pattern, and the buzz for WebOS was the "same," therefore the conclusion is going to be the "same."
Just one problem....Palm was never a cultural icon. Palm never had 75+ million users. Palm was already bought by another company BEFORE the WebOS release.
I do not believe a few chart similarities justify an identical outcome

The Palm Pre was launched as a Sprint exclusive with about 30 apps (not 30,000... just thirty - as in three-zero) and without a broadly-distributed webOS SDK. It subsequently added carriers in different countries but only several months after the launch. The Pre sold less than half a million units in its first quarter and a few months later it was acquired by HP. After vowing to "double down" on Palm, HP promptly executed a textbook case of self-destruction, and the rest is history...

My older son and wife are current iPhone users and have been for a while now; however, both have been highly impressed by what they've seen of BB10 (via leaked demos) so far. Both have told me that they would be willing to switch over to BB10 so long as there is a sufficient selection of apps. Based on all indications from RIM (via interviews, port-a-thons, etc.) the "app gap" issue will be a non-issue at launch. I so hope this to be true. Waiting anxiously for Jan 30th!!

rick (comment above yours) said "Based on all indications from RIM (via interviews, port-a-thons, etc.) the "app gap" issue will be a non-issue at launch".

You rephrased what he said.

I'm sure there are enough apps to keep most happy. The best part is, creating apps for BB10 is supposedly easy.

Reading comments people post about how they/people they know are switching over to BB10 from iPhone makes me very happy!

Well writen as usual! I bought a few prior to the big drop and a lot more when it was at its lowest. Its nice seeing them in the positive!

The smartphone leader board is going to look very different in 2013, in my opinion. Will BB10 shoot up to top spot? Maybe yes, maybe no, but I think we're going to see the erosion of other platforms' users over time.

I don't see BB10 making #1 spot. What I predict is the market leveling itself. Android will hold the #1 spot, Apple will hold #2, and RIM #3, but the gap between each competitor would be so close it doesn't really matter what number they are on. I see Windows also making a bigger dent in the market. These are my predictions.

Chris, I gotta give you props on the last paragraph. We loyalist and fans have been patiently (and impatiently) waiting for BlackBerry 10. We have given huge props to Thor for making necessay decisions and steering the boat to where she needs to be, but I think most of us forget to think about the people behind the scenes. The engineers and architects, hell even the mail guy. So this is me, a BlackBerry user, fan, share holder and supporter, saying thanks for ALL your hard work in making BlackBerry 10 what it is and what it will be. I know what its like to work days in and days out and I can't wait for the launch and the time the RIM employees will be able to take some time with their friends and fmaily and say, "This is what we built" Congratulations #TeamBlackberry

Sincerely,
The Angry Edmontonian.

I Bleed Black & Berry

Well written Chris, I always enjoy your editorials. In less than 10 days, we will see the fire of RIM's alchemy. A very BIG THANK YOU for all RIM employees (past and current) for BB10 and the future.

As soon as the phone drops I'm jumping to get one and buying a bucket load of apps! Great article Chris, after a couple years of people bashing RIM we finally see the light at the end of the tunnel! Exciting times ahead.

My BB life (last 3 years)... Storm2->9800->9860 and playbook... Now waiting for Z10 since then I recruted a dozen of persons near me to teamBB... All are anxious for BB10... Gooooooo BlackBerry......

I would love to get some intel on how will BB10 roll on the LatAm front.

I know store representatives can't be trusted to know anything, but most of them are totally unaware of a new BB OS, new phones... Some don't even have a single berry in the store.

Any info would be appreciated.

Kudos for Chris! Between all the excitement and feeling pumped, I'm glad someone on team Crackberry is throwing around some numbers to keep me at least a bit down to earth.

From a customer standpoint, I do hope they don't want to earn THAT much on handset devices. There are a lot of nice phones out there now, and more to come. I hope the price will be market compatible or maybe even a little lower so people won't spare the few extra dollars and go for something they are already familiar with like a Samsung or Apple. It would also help me save a few bucks cause I prolly wanna go get it off contract!

On that note, I hope Dutch Telecom providers make up there mind soon if they wanna sell the new phones. There is still only news about 1 provider (:

Looking forward to it!

I've never been so excited for a piece of hardware in my life as I am now...

Except, possibly, the nintendo wii... But that's in a different world :)

Your anecdote about Kevin getting calls from media to get educated on BB10 is great scuttlebutt!!! That's exactly the type of gem a Philip Fisher/Peter Lynch-inspired investor hopes for every time they come to a site like this. Thank you for sharing it!

I've been with Blackberry for the longest time. Now I'm waiting for one of the best comebacks in IT history. Hoping for the BB10 launch to go well and have the resurgence of RIM as the 3rd competitor. Long live RIM! Can't wait for till the BB10 launch, 10 more days !

My point is this - there's a huge disconnect between the current stock price and the analyst estimates for next year. - Umi

_________

Rightfully so, as end of Feb 2013 is not relevant in regards to EPS moving the stock +/- .

The launch and the 2quarters after end of Feb 2013 will make future EPS relevant to stock +/- .

I would think end of Feb 2013 EPS is already built into present share price. :)

Thanks again for a great article Chris. I'm so ready to have BB 10 in my hand and be an advocate for RIM.

The truth is that Z10 will likely do well in Canada but to increase their market share in US and rest of the world ,I believe they will have to launch at least 2 or 3 more BB10 device within the next 6 months to capture a wider user base to BB10. Obviously in the next few months ,how BB10 will catch on in the US market will be key. The latest reports about waning interest in iOs may help BB10 in this respect

The qwerty model will follow shortly afterwards and then it is expected that we will get a cheaper model to increase volume, so they should be matching or exceeding your 2-3 devices in the first quarter let alone 6 months.

You do know that one can't directly compare the two companies because there underlying business structure and product mix is different.

Great write up!!! Just wish I bought RIMM stock at $6.....would already be making money! I truly believe BB10 will surprise most of the non tech smartphone users who remember a world before iOS and Android. Yes the "app gap" will still somewhat exist since 70,000 is no where near the App Store or Google Play.....but it will have the apps people actually use....that is ALL that matters... Good luck RIMM and I can't wait to get my hands on a new BB10 device as soon as they are available....no matter the price. I believe in RIMM!

I kept telling my friend that buying RIM stock during the days it was still at $6 was a very good investment. It sounded crazy from an untrained eye. It would be stupid crazy if someone buys shares from a company that continues to neglect their situation, but RIM has been at full force and their situation motivated them even harder. Sometimes you get the best from people under pressure.

I predict that RIM stock will probably peak at $35 this year and possibly stay at that range for another year. It'll rise slowly in 2 yrs after QNX starts releasing new stuff that is compatible with BB10.

Feb 1st. Is my prediction
Mind you it is just that and nothing else. I hope I am right! But I won't be surprised if it is a week later or even 2 . Either way I'm SO EXCITED!!!!
P.S. Great article :)

Can't wait for the launch but I hope RIM doesn't pull a Bold 9900 and price it at $299 with contract at launch. Idk if it was RIM or the carrier who came up with that price but 299 was too much. Hoping for 99-150 but 200 max.

Your second sentence is more like it. The carriers ultimately have the say so on price. The unit will come with a "suggested retail price". The carrier decides the actual price and subsidy.

My 10 years wait will be over..never used anything else but RIM smartphone. Before smartphone came out, used Motorola flip..

AMAZING article! So inspiring! I really loved it.

It sets the mood for what I'm sure will be a very exciting ride. I'm cheering for RIM too, always been, I love the brand and even more now. It surely goes to show how big of a change a new CEO is capable of doing alongside an incredible team :)

Thanks again for the amazing article Chris!

Shorts are angry & yelling @ perter misek & his firm on friday after the upgrade. Not a rumor but confirmed by him on TV. Shrts be Prepard for short squeeze..$20 coming soon..

Chris ... decent article however ...

The stock hit $15.xx before the Dec 20th fiscal qtr end.

"When was the last time the media was busy preparing themselves to write about a good news story on RIM? I honestly can't remember. It seems like so long ago."

^ how would you know?! Their contacting Kevin not you, right? So how would you know when the last time the media was "busy preparing themselves to write about a good news story on RIM"? See my point on this?

The key part many are NOT realizing including the BB10 mad crazed fans (whom don't invest nor watch ReutersNewsPro or Bloomberg reports) ... is this ....

" ... the stock has a long way to fall if BB10 ends up being a fizzle rather than the huge recovery we think it's shaping up to be. Obviously it all comes down to sales, which we'll have to wait to see."
^ YES we'll need to wait and see a full another quarter more ... June 18th 2013 time frame to be exact to know the hard numbers for sales. We're already in Q2 of 2014 Fiscal quarter for RIM, this means it ends on March 19/20th (The last quarter ended Dec 20th). BB10 device even if sold in stores and online ON Jan.30th will not show up in this current fiscal quarterly report due in March 2013 ... they'll show up in June.

One of the key points to remember here comes from Peter Misek's upgrade on Friday: production has already been quadrupled from early runs, due to higher-than-anticipated demand.

At this point, things are looking good.

Re: "we'll need to wait and see..." You are welcome to wait as long as you like but as a wise man once said, if you wait until you see the robin, spring will already be over. Or in other words, the future is never clear, and you pay a very high price in the stock market for a cheery consensus. The consensus is still very negative but getting more and more cheery by the day. Given that the negative consensus is in direct contrast to all the indications we here at CB see pointing to good news ahead, do you really think you will be able to buy shares at these low prices by the time summer is here?

Excellent article chris! I can't wait to get balckberry 10 in my hands and I'm waiting for that x10 or qwerty one! :)

the article was well written (very well put). I am a huge BB keyboard supporter/user but cant wait to try the touch screen version

At times in the past year, I've wondered if I was actually delusional. To me, in many instances market reaction to RIM news seemed VERY exaggerated.

I've hung in, frequently bailing when I anticipated a drop and buying in when I expected a lift. I didn't always call it right, and I still have a ways to go before I'm profitable again. Even so, I made my last major buy in September's at $6.21 and I'm pleased to see the growth since then.

I want to join Chris in congratulating RIM. No matter how well BB10 does in the market, RIM has done its level best to produce a competitive product under extremely difficult conditions and if they succeed, it will be one of the great underdog stories in business history. When I think back on how many critics were doubting that the company would even MAKE it to launch, I can't help but smile.

Same. Could not have said it better myself.

Thank you for the inspiring read as always Chris Umi. I agree, "the stars seem to be allinging for RIM". I'll remember where I heard it first.

Enjoyed reading your article, Chris. As we get closer to launch date, I really hope and pray for RIM's success and comeback as the smartphone underdog company. :-)

nice one Chris. yeah, 2012 has been such a tough moment for RIM. lots of downs but finally the upside is coming and yeah.. 9 more days to go. HERE WE GO Team BlackBerry, let's hail BB10!!!

Jan 30 will mark the greatest history in RIM and us, Team BlackBerry. Let us get ourselves prepared, re-designed, re-engineered & re-invented before we finally meet BB10 face to face.

Z10.. come closer to papa!!

Nice, Chris. It is SO refreshing to see so much positive press for RIM lately. Still a few malcontents spouting last year's news, but they are being increasingly outnumbered. I can't wait to see how BB10 is received by the public; but it sure is good to see RIM actually being given a fighting chance.

Thank you for the great article, Chris.

I has been such a pleasure (and a profit) to closely watch RIM evolve over the past year. I believe we are all about to witness something BIG with BB10 and the future of QNX. As crazy as it sounds, Jimcmf and Kurt Windibank may be right....