“Shares of BlackBerry maker Research In Motion Ltd dropped 20 percent on Friday on fears that a new fee structure for its high-margin services segment could put pressure on the business that has set the company apart from its competitors,” Allison Martell and Chandni Doulatramani report for Reuters. “The services segment has long been RIM’s most profitable and accounts for about a third of total revenue. Some analysts said there was a risk that the fee changes could endanger its service ecosystem and leave the Canadian company as just another handset maker.”
MacDailyNews Take: In the interest of truth, replace “just another handset maker” with “yet another piece of iPhone roadkill.”
Martell and Doulatramani report, “The company said the new pricing structure would be introduced with the BlackBerry 10 launch, expected on January 30. RIM said some subscribers would continue to pay for enhanced services such as advanced security. But under the new structure, some other services would account for less revenue, or even none at all.”
“The news of the new services pricing strategy came as a shock to markets, and some analysts cut their price targets on RIM stock. RIM will not be able to sustain profitability by relying on its hardware business alone, said National Bank Financial analyst Kris Thompson, whom Thomson Reuters StarMine has rated the top RIM analyst based on the accuracy of his estimates of the company’s earnings,” Martell and Doulatramani report. “Thompson downgraded RIM’s stock to ‘underperform’ from ‘sector perform’ and cut his price target to $10 from $15. Forrester Research analyst Charles Golvin said the move was likely about stabilizing market share: ‘At the moment, they need to stem the bleeding.'”
Read more in the full article here.
MacDailyNews Take: Fsck the ambulance, call a hearse.
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Beleaguered RIM posts loss of $114 million; sales tumble 47%; 1 million subscribers lost last quarter – December 20, 2012
Beware the sucker’s rally in beleaguered RIM, Nokia – December 18, 2012
Hey. I thought we were switching from beleaguered to clueless. Or is that for M$ only? 🙂
They’re beleaguered when they’re under siege, taking mortal damage. They’re clueless when they reveal no real understanding of what’s happening to them.
RIMJOB is no longer talking like a smartarse about Apple. 😉
I think RIM will bounce back. Go RIM!
(By the way, I still won’t ever buy one of your handsets, but I hope you get healthy again, in the interest of competition)
I’m afraid RIM has few attractive market qualities and ones that mattered in the past, now, not so much. I look at what they have as terminal with the disease slowly but surely progressing. I still think it hilarious when Palm chief executive Ed Colligan said in 2006 he doesn’t plan on losing any sleep over rumors that iPod maker Apple Computer is on the verge of breaching the cell phone market with a new handset device.
Responding to questions at a Churchill Club breakfast gathering, Colligan reportedly “laughed off the idea” that the Cupertino, Calif.-based company would experience any immediate success in delivering a device to the fastidious smart phone market.
“We’ve learned and struggled for a few years here figuring out how to make a decent phone,” he said. “PC guys are not going to just figure this out. They’re not going to just walk in.”
BOOM! I love the clueless CEO laughter (Ballmer & Colligan on news of the iPhone) before the denial, crying and final company closing curtain.
It look like BlackBerry is very popular in Asia. The Richest region in the world….
Yes but for how long Spock. For… how… long…?
Now climb back into the car trunk, Chang.
Will they even be able to afford the funeral?
RIM is just trying to preserve market share at the expense of profits right now.
Things are looking G-RIM for the handset maker.