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The analyst day preceding Research In Motion’s Wireless Enterprise Symposium, which starts May 5 in Orlando, Fla., left a positive impression on Broadpoint AmTech analyst Mark McKechnie.
“We came away with increased comfort in the long-term story and believe the May quarter is on track,” McKechnie wrote in an investor update.
The first quarter of 2009 was also nicely “on track,” as RIM BlackBerry devices surpassed the Apple iPhone in consumer sales.
According to McKechnie, RIM management said cost reductions will be arriving for its BlackBerry Storm and BlackBerry Bold smartphones, and there will be a “mix shift to lower-priced but higher-margin Curve and Pearl products.”
No new products were announced to analysts, so it is presumed none will be announced at WES, but McKechnie expects the BlackBerry Niagara to arrive “fairly soon.”
The BlackBerry Niagara-which early testers have reviewed very favorably-is certain to face competition from the Palm Pre, set to debut soon, and one, or possibly two, new iPhones that are expected to arrive in June.
RIM announced on May 4 that AT&T will soon be offering the BlackBerry Curve 8900, and McKechnie reported, “We were encouraged (but not surprised) by [AT&T’s] announcement to carry the EDGE 8900 Curve phone in the ‘summer.’ We also note a continued preference by [RIM] management toward supporting evolved EDGE [Enhanced Data for Global Evolution] for emerging markets.”
RIM reportedly suggested to analysts that inventory was, desirably, near an all-time low. “[RIM’s first-quarter] unit guidance of 7.5-8.0 [million] units assumes no ‘restock’ in the channel, which may prove conservative and thus represents upside to this quarter or next,” wrote McKechnie.
McKechnie additionally reported that, with RIM’s data traffic growing, he anticipates a tripling of traffic on RIM’s NOC (Network Operations Center) by 2010 and so an investment in infrastructure expansion in 2010 to support subscriber and data-per-user growth. GPS applications, RIM told the analysts, are particularly big data consumers.
Finally, McKechnie noted that RIM’s BlackBerry App World, which debuted April 1, already carries 1,000 personal and business applications, which can make use of RIM’s push technology, and that developers receive an 80 percent share of application sales, whereas developers for Apple’s App Store receive 70 percent.
In conclusion, McKechnie wrote, “We are encouraged by margin commentary and lean inventories for the near term, and a longer-term road map for ‘smart appliances’ in the enterprise.”
For RIM’s current quarter, Broadpoint estimated a revenue range of $3.3 billion to $3.5 billion and subscriber additions ranging from 3.7 million to 3.9 million.
In addition to the BlackBerry Curve 8900 announcement at the WES show, RIM announced projects and alliances with Hewlett-Packard and Cisco Systems.