BB10 Believe

For most of the last couple of years, media attention on Research In Motion has been horrendously negative. Even good news would be inspected under an electron microscope, and if there was the slightest possible reason to be negative, the headlines would come out in full force that RIM was, in fact, dead. The common cold was mistaken for terminal cancer.

Over the last few months things have been changing. Most of the media isn't picking on RIM nearly as hard as they used to. And there has been a pickup in the number of positive articles, such as this excellent story about growth in Nigeria by Iain Marlow of the Globe and Mail.

There are probably a few good reasons why this has happened. Most important is BlackBerry 10. RIM has been constantly demonstrating its latest public pre-release versions of the OS and there is no question it actually looks good, and differentiated. People can't help noticing that RIM doesn't look quite as weak as they thought months ago, so the negative articles slow down. Nobody wants to pick on a company when the chance of being wrong has gone up.

Then there's the competition. As much as I admire Apple (and it's a pretty big chunk of my investments), they've had a few problems lately, including maps, iOS6 bugs, and executive departures. So the negative attention has turned, for the time being to Apple. For the record, I believe the Apple nit picking is about as overdone as the RIM beatings were.

Microsoft hasn't faired too well either. Surface sales are off to a "modest" start, which wreaks of a Playbook-like launch. If Microsoft is the latest company to launch something that isn't doing terribly well, the media will spin plenty of stories about it.

So at least over the last couple of months, RIM smells like roses relative to the competition. This isn't an statement of absolutes, so don't misunderstand me. I'm simply pointing out that RIM hasn't had any bad stuff happen lately, while the other guys have.

And then, yesterday, we got the official news that BlackBerry 10 will be launched via a global launch event on January 30th. This news was huge to the market. The stock rallied immediately upon market open. Remember that market professionals tend to focus very much on short term events. That's just the way the industry is designed. So naturally, you see analysts writing about a pending "short squeeze" on the stock. This just means that people who "shorted" the stock will feel the pressure to cover their short.

For those not sure what this means, shorting a stock means you borrow shares, sell them today, and hope to buy them back (to return them) later, at a lower price. You profit when a stock falls.

Anyway, I had to laugh when I saw the headlines that one analyst with a sell recommendation on the stock actually upgraded yesterday. Honestly, has anything really changed? No. Anyone paying attention knows darn well that BlackBerry 10 is looking good for its Q1 release. RIM already told us that they're in carrier labs (which usually means 60-90 days to release). So how does getting an actual date for the launch event change anything?

It doesn't. But it changes the sentiment, and the sentiment on a stock controls its short term trading direction. I find this stuff incredibly hard to predict, which is why I avoid short term trading in stocks.

I'm thrilled to see another sign that BlackBerry 10 is coming. I can't wait to upgrade. And I'm glad (as a shareholder) that the stock is moving in the right direction again.

All that said, the facts are still the same. RIM needs to show us that they can make money again on hardware, and they need to avoid losing control of their $1 billion in quarterly service revenue. If they can manage to make that happen, we're looking at a very good news story.

Here's to Thorsten Heins executing on the turnaround of the decade. We're rooting for you, RIM.