Add to del.icio.us     Digg this

Nov. 18, 2009

Avian Research analyst Matthew Thornton says that BlackBerry maker Research In Motion (RIM) is unlikely to see any growth in the U.S., Canada or in the U.K. in two years from now, as incremental competition from Google's Android operating system and some increased distribution of Apple's iPhone undermine RIM's presence in the smartphone market.

He added "positive Android user reviews and numerous launches will clearly eat into RIM's market share, especially at Verizon. One example we have seen is a Verizon offer to Storm 1 users to switch to Storm 2 or Droid regardless of where they are in their contract. We assume some of those 5 million RIM users will be lost to Verizon."

Thornton believes these factors will drive RIM to explore outside its core markets, which accounted for about 23 percent of sales in 2008.

The increased dependence on non-core markets in areas like Latin America introduces increased risk, reports Thornton.

Additionally, RIM is expected to lose a considerable amount of shelf space at carriers Verizon Wireless, AT&T, Sprint and even T-Mobile USA.

According to a Gartner report produced last month, BlackBerry will have about a 13.9 percent market share in the smartphone market by 2012.

This puts RIM's platform slightly ahead of the iPhone but considerably under Android-based devices, which are expected to have about a 18.2 percent market share in less than three years from now.

It will be interesting to see what the outlook will be in three to six months from now, and to observe if this new trend will continue.

Some wireless industry analysts think that the Avian report is a bit negative, and that RIM will most likely rely on other of its core competencies to weather the storm.

RIM's CEO Jim Balsillie said it hopes to extend BlackBerry service into markets including Russia, Latin America, China and Southeast Asia, countering investor and analyst concerns the firm will be unable to sustain its history of expansion.

Balsillie added that RIM will also introduce new MID's (mobile Internet devices) and applications as well as bolster R&D spending for the rest of the year and well onto 2010.

Add to del.icio.us     Digg this

Source: Avian Research.