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Readers Riled Up About RIMM

I am very bearish on Research In Motion (NASDAQ:RIMM) right now despite a big run in the last month or so. In case you haven’t read my recent commentary (here and here), my reasons include:

  • Pathetic PlayBook sales that hint it will never have a viable tablet product.
  • Big risks with the BlackBerry 10 launch, since even proponents will admit this OS is do-or-die.
  • A currently unprofitable business.
  • A massive run-up on sentiment, not fundamentals.
  • The fact that Apple‘s (NASDAQ:AAPL) iPhone and products using Google‘s (NASDAQ:GOOG) Android are steadily making inroads to enterprise business.

That’s my take, but I won’t waste any more time on it here.

… OK, just one more thing: All this “enthusiasm” lately is relative. Consider that a favorable headline lately was that Jeffries & Co. (NYSE:JEF) increased its outlook for BB10 … to just a 20% to 30% probability of success! Forgive me if I don’t take those odds.

But rather that assail you more with my views — my “slant,” if you will — I’d like to give you some of the choice comments this blog has received that represent the other side.

Here’s what the RIMM bulls have to say. Most of these comments are anecdotal, but I figure they are worth calling out for balance.

(Editor’s Note: The comments have seen minor edits for readability and occasional profanity, but you can read the originals here and here.)

Tools vs. Toys

The author ought to visit the UK to see what is supposed to be a declining market for RIM. The young over here carry two phones. One will be Apple or Android but the other will definitely be a Blackberry and that is the one they use for actually making phone calls, sending texts and IM’s. Ask which they would give up and it won’t be the Blackberry. They are not buying new Blackberry’s because the build quality is so good that old ones suffice.
They are the market for the BB 10 and they are prepared to wait for it so they can then dump what they consider toys.

Don’t Count Out the Oldest OS

Critics who have bashed this company relentlessly for the past year have changed their tune with the new OS and are impressed, Verizon (NYSE:VZ) and other carriers are backing it and developers love it. 80 million users with the oldest smartphone OS, now you dont think they will sell with the most modern OS? What more evidence do you need to change your mind apple fanboy…your iphone is going to look like the old Blackberry in 6 months..

Tactile Triumph

You are a moron! Blackberry has a loyal fan base. I have the blackberry bold 9900 and the iPhone 5. I carry my Blackberry everywhere and my iPhone I use for my internet business. I can’t wait for the Blackberry 10 qwerty phone! It gets the job done. I send 100′s of emails on the go every day. There’s no way my iPhone could handle sending those emails.

Apple Is Too Invasive

I use an iMac desktop and a Macbook pro. I don’t like the way Apple is trying to corral me to all their products or the mess them made with Iphoto to try and lock me in. I like will be purchasing a BB10 device. Do you think it’s sexy to be hog-tied by and to one company?

Best OS, Period

“…What’s the compelling reason to believe in RIMM stock? Do you really think the BB 10 OS will be good enough to contend with Apple and Google…” As someone in the computer field for 25 years, yes I do think it will be every bit as good or better. What are your qualifications to judge OSes?

No Improvements Elsewhere

Other than the same upgrade that ALL phone manufacturers make, Apple hasn’t really done anything to wow people for a while now. I use 2 phones. Guess which one is reliable and I trust with my business? Not my android. I wanted to grab one so I wouldn’t be biased. And guess what? It’s nice, but it freezes… crashes… and drops NOTICEABLY more calls. Once BB10 is introduced, I will be selling my galaxy for $200. I tried an iPhone as well, without prejudice, and it definitely didn’t wow me. I sold cell phones and half the morons that bought the Iphone had no idea what it did! It just goes to show, that you idiots, purchase the iPhone because you jumped on the band wagon. I am a financial advisor and I told a lot of my clients to invest in RIM when they were at $5.50. You do the math. Don’t give any advice if all of it is your own personal psychology without facts to back it up. Learn about business then start talking.

The Market Disagrees

You missed this one. Is it a just a short squeeze or is the new operating system simply a better technology. Developers like the new platform. Should help develop apps which until now was the biggest stumbling block for RIM.

Judge the Technology, Not the Sentiment

It really is good fun, all the bears with an internet connection bashing RIM for their money, even though they never even owned a handheld or playbook. The perception of BlackBerry by those who do not know the products is impressively far off. This is how bubbles develop, and it is also how stocks get heavily underrated. The market always catches up, and as always it is good to be ahead.

The Upgrade Wave Will Be Huge

You’re so wrong about RIM not seeing Apple & Android coming, but they had an aging OS that needed a fresh start. Few companies succeed at what RIM is about to accomplish, but RIM is doing it! RIM carefully chose a great path forward with QNX as the robust and proven platform, and now they’ve created a uniquely powerful user interface that is designed for the busy person juggling many different things… usually with only one hand on his phone! Yes, that would be me… and millions & millions like me! Success is in the cards, my friend. Millions of BlackBerry users are looking to upgrade to these BB10 devices — they’ve been patiently waiting. Sales will exceed expectations on the Street as not only will these phones be embraced by the 80+ million BlackBerry users worldwide, these phones will attract many of those users who have left for seemingly greener pastures, only to be disappointed. I know I will be upgrading early in February even if my contract ends next fall.

What Do You Think?

Share your thoughts and comments below and keep the conversation going. I remain convinced that buying Research In Motion right now is very risky amid the all-or-nothing BB10 launch, but what’s your investment strategy?

Related Reading

Jeff Reeves is the editor of InvestorPlace.com and the author of “The Frugal Investor’s Guide to Finding Great Stocks.” Write him at editor@investorplace.com or follow him on Twitter via @JeffReevesIP. As of this writing, he owned a long position in AAPL.

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Comments
  • rpwalker

    Over the past year I have been stung 5 times by you and your “analyst” brethren. 5 times I bought a stock on the basis of its financial soundness and 5 times you idiot gloom sayers have torpedoed them with your pile-on tactics. That panicked the market and it dived. You guys don’t know any more than I do but I suffer from your disproportionate negative influence. You have the luxury of no accountability while still being paid to flap your gums. Do us a favor…shut the hell up!

    • http://twitter.com/rlzaleski Robert Zaleski

      Don’t hate and blame bad timing on analysts. If you’re right, then just sell and watch when a stock dives. If you’re right it’ll recover, if you’re wrong it’ll tank and never recover. When the BP mess happened it went 55 -> 25 -> 50 -> 45. I knew there was no way the whole ordeal could cause the company’s assets to drop in half, but people panicked for a variety of reasons. Obviously the market isn’t instantly efficient, it just tends to be more efficient than other methods over the long run. If you had waited and bought BP at 30 after it started to bounce you would have made some nice money quick. Vodafone did the same when the whole Euro Debt crisis hit the fan a few years ago. Ditto after the Banking Crisis. But buying in the midst of all of that is just stupid, and if you’re buying your own stocks you need to own that if you want to improve.

      If you love Rimm, buy it. Just make sure you’re watching it closely and sell if it drops. A lot of this negativity is baked in, but in reality it might still drop. Honestly if you love it that much you should have gotten it at or under $8 when it traded sideways a few months and had some nice pops in it’s price and volume, instead of semi-chasing chasing it now.

      The one thing RIMM does have going for it is the NSA and IT Nazi’s love it as a platform. It’s still unclear if Corporate IT is going to let Android and iPhone apps integrate with their internal systems, or if they’ll insist on total control like they do for Laptops. Nothing is preventing a total control model for iPhone and Android devices, but it’s not really there yet.

  • http://twitter.com/CharlesSizemore Charles Sizemore

    Jeff, the other risk that no one else seems to notice is that RIM will be competing to make up lost ground against a Microsoft with a new-found aggressiveness in mobile. AAPL and GOOG Android have made huge gains in the enterprise market, but my bet is that MSFT is the one that eventually muscles RIM out of that arena. MSFT “gets” the enterprise market to a degree that AAPL and GOOG never will. (De-throning AAPL in the consumer market will be a tougher challenge, but not impossible). Should be an interesting 2013 in mobile.

    • dom

      WP8 has already got hacked by a teenager in India. No government or enterprise will use wide open to hacking WP8. You Microsoft employees are pathetic. BB10 is going to distory every other OS. BTW I have a sg3 and will trade it for bb10.

      • ChetanTakyar

        As I said BB are for idiots.

    • Michael

      Charles, I guess I don’t know where you get your facts from. Windows Phone hasn’t gain any traction in any market. Second, if Microsoft gets the “Enterprise” like you claim, why didn’t they create dual persona’s like BlackBerry 10 does so when you leave your company or business, the IT department doesn’t wipe your phone? I’ll take my chances on RIM.

      • http://twitter.com/JeffReevesIP Jeff Reeves

        Glad you brought up dual personas… because I have been wondering about this. My company will not let you KEEP your phone when you quit or are fired. They take it back. So what is the point of that? If your company provides a BlackBerry and they demand it back when you leave… it’s wiped anyway. If you abscond with it… you keep all your apps and contacts. On my company iPhone I have a work email as the default mail and then a Gmail app for personal mail so I have long had a “dual profile.” I just don’t get how this is a selling point. I can already avoid a Panetta-like sex scandal by using my Gmail app, if that is the gist here. Read more on the BB blog to get more info – http://blogs.blackberry.com/2010/06/merging-work-and-play-with-the-blackberry-platform/

        • Michael

          The purpose of the dual persona’s is not about Corporations buying your phone anymore as the world has shifted to BYOD which stands for “Bring your own Device”. The consumers are making companies face the reality of it. Your company may issue an iPhone now, but the reality of the situation is, many people will want BlackBerry 10. What will your company do then? ;)

          • ChetanTakyar

            What many people want BB0? ive asked a lot of people and they said BB is still alive? LOL nicetry but android and iOS is where the goodies are.

        • http://twitter.com/CharlesSizemore Charles Sizemore

          “Panetta-like sex scandal…” LOL

    • Marco

      RIM took on MSFT early on when the phone wars started and RIM won. I would not rule out RIM’s ability to take on MSFT again. BTW did you notice that Windows 8 is a disaster?

  • Sbryce

    Typing this on my BlackBerry Dev alpha. So not final release but already better functionality than other so called smartphones. Well worth the wait in my opinion.

  • http://www.facebook.com/profile.php?id=100000160977235 Michael Schmitt

    After consideration of Apple Maps, and Apple’s Death Cross along with the lack of innovation that leaves a portal open for RIM. Microsoft hasn’t brought any innovation that would be considered “game changing”. The fact that RIM has a vertical OS that can run multiple devices such as a TV, Car, etc… I believe they can pull it off. The second most unique acquisition is The Astonishing Tribe which is gonna bring sexy back! You need to look no further than this to see innovation is happening at RIM:

  • http://www.facebook.com/vijit.coomara Vijit Coomaraswamy

    Everyone is entitled to an opinion. Hopefully the opinion is honest and does not have have a financial agenda. We shall wait and see. Whether it succeeds or fails is really up to the consumer. I know I will be dumping my galaxy s3 to get a new blackberry 10 as I miss my old 9700 and the simplicity of blackberry messaging. If others dont buy the blackberry and RIM goes into the tank, I will then buy something else. We have lots of choices. What is all this hubbub about anyway?

  • http://www.facebook.com/mary.v.hoek Mary Vander Hoek

    Rim has a lot of freinds. I bet on RIM over apple long term. I own both stocks.
    and a iphone. I have no interest in Android longterm.

    • ChetanTakyar

      LOL rim is gonna fail and you know it! RIM is for idiots that wanna hold on to an old operationg system!

  • Crestington

    I bought RIM shares at $8, sold them at $14 a few days before their last earnings call, shorted a small bit on the likely chance that the price would tank and rebought my shares for $12.

    There are a lot of crazy blackberry fans but I was never really a fan of the phone. The reason I am so optimistic of the bb10 is that it addresses all the issues I have with my current iPhone 3GS. I don’t want an upgrades version of a phone I that causes me grief nor do I want a google malware magnet or a very unimpressive Nokia so by default it leaves me with blackberry which I must say looks like it will beat every other phone on all fronts. Rims current track record since thorston heins took over has delivered consistently above expectations so I can see a very likely turn around and once people start to see what a quality product the blackberry 10 is they will flock to it like isheep.

    Right now th only ones that really know that bb10 is coming out are blackberry fans the invesemt counity and big businesses despite heavy marketing so I expect that initial sales will be above average and begin to gain momentum quickly.

    Thorston heins has realistic goals and is focused on releasing good quality products rather than rushing in order to make a quick buck off of seasonal buying.

    I think that at the current market price of 11.80 a share represents a good entry point into a company that will be worth $100 a share in 3-4 years time

    Agree or disagree, just adding my 2 cents.

    .