Optical/IP Networks

RIM's Four Aces

Canadian device vendor BlackBerry is expected to try and outgun rivals such as Apple Inc. (Nasdaq: AAPL) and Nokia Corp. (NYSE: NOK) in the smartphone space with a quartet of new devices available before year’s end, according to analysts.

The first of these, the 3G BlackBerry "Bold," has already caused a media frenzy, albeit on a more limited scale than the launch of the new 3G iPhone this month. The Bold is the harbinger of a new generation of faster 3G devices from the mobile email mavens. Analysts, however, are also expecting a touch-screen device, a flip-phone and a low-end smartphone from RIM before 2008 is done.

”By the time the year is out, RIM will have a variety of form factors available and will be quickly transitioning to 3G,” says Carmi Levy, analyst at Toronto-based AR Communications Inc.

All of this 3G frenzy will be kicked off with the Bold. RIM announced the Bold early in May after months of speculation. The 900 series device runs on a tri-band HSDPA (high-speed downlink packet access) 3G radio and contains GPS and WiFi connectivity options, as well as more usual RIM features like a full qwerty keyboard. (See RIM Unveils 3G Device, VC Fund and Is RIM Behind the Curve in 3G Handsets?)

“I still think the Bold is the important release, that is the flagship, their Cadillac, if you will” says Jack Gold of J.Gold Associates. “Everything after that is their Ford, their Hyundai.”

Questions still remain, however, about exactly when the Bold will hit the market. The Bold has been approved for use in the U.S. by the Federal Communications Commission (FCC) but doesn’t have an official launch date yet. In fact, AR’s Levy believes it will be available north of the border first.

”I think it has been pushed back to September in the U.S.,” he says. “But Rogers Wireless Communications Inc. (NYSE: RCN; Toronto: RCM) could announce it as early as next week.”

The next most hotly anticipated gadget from RIM is the firm’s touch-screen device. Levy is now expecting the handset, codenamed “Thunder," in October and predicts that it could be a Verizon Wireless exclusive. The Thunder is likely to share much of its feature set with the Bold. (See RIM's Touching New BlackBerry Plans.)

The Thunder will be the device that goes head-to head, in the public’s eyes at least, with the 3G Apple iPhone. Analyst Gold, however, doesn’t see the touch screen as a hugely important gizmo for RIM.

“I think the touch screen, frankly, is not likely to be a big seller with the enterprise crowd, because they want a Qwerty keyboard. It is more RIM showing that they can make one,” says Gold.

AR’s Levy, however, says that the third phone on the company’s plate, the “Kickstart” flip-phone could be very important for RIM in the consumer space. “They had a good first hit with the Pearl but that’s over two years old,” says Levy. “The flip-phone is the logical follow-on.”

The analyst expects that the kick-start will move to 3G very rapidly if it is not in fact launched on a 3G platform in the first place. Levy says that the phone will pull in features from the RIM Curve series of smartphones.

Rounding out RIM’s hand is a non-3G model aimed at the low-end of the market. The “Javelin” is also expected to be available by year’s end.

Analyst Gold, however, notes that RIM may need to look beyond mere devices if it wants to compete fully in the consumer space. This, he suggests, will involve more content sand software partnerships so that RIM can try and counter Apple’s iTunes and App Store work with the iPhone and Nokia’s attempt to branch into content delivery and social networking. (See Nokia Is Going Plazes.)

”The big question for RIM is how to expand the blackberry franchise,” says Gold. “I would almost suggest that they to have a sub-brand if they want to get heavily into the consumer space, like BlackBerry Jnr. or something… I don’t expect that to happen… But it is a way to not dilute the main enterprise brand.”

RIM hasn’t yet responded to questions about its future handset line-up.

— Dan Jones, Site Editor, Unstrung

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