John Paczkowski

Recent Posts by John Paczkowski

Ray of Hope? Carriers Seem to Like BlackBerry 10.

The tide of negative sentiment that dragged shares of Research In Motion deep into the mud and kept them there for well over a year is letting up ahead of the launch of the company’s new BlackBerry 10 operating system. Why? Reports that carrier interest in BB10 is actually pretty strong.

Jefferies & Co. analyst Peter Misek on Tuesday raised his rating on RIM shares to “Hold” from “Underperform,” doubling his price target to $10 for this very reason. “We have been surprised by the strongly positive initial feedback on BB10 from carriers,” Misek wrote in a recent note to clients. “We are a bit puzzled as we expected a more muted response given BB10 is two years late and RIM’s market share has plunged from 20 percent to 5 percent.”

Indeed. Misek, who’s generally pretty skeptical of RIM’s prospects for a turnaround, now thinks BB10 has a 20 percent to 30 percent probability of success. In other words, the company is still a huge gamble, but it’s a better one than previously thought. Misek figures carriers see BB10 as one of their last chances to avoid being locked long term into Apple and Google’s smartphone OS duopoly.

It’s worth noting that there are still plenty of contrary views out there. Pacific Crest analyst James Faucette, for example, today issued a note arguing the chances are very slim that BB10 will reverse RIM’s precipitous slide. His big concern: That Google, Amazon and Microsoft will begin subsidizing not only mobile hardware, but mobile services as well. If they do, that could be devastating for RIM.

“If declines in [RIM’s] service business were to accelerate, the key remaining bull case on the stock would be dramatically undermined,” Faucette wrote. “Let us be clear: we do not have a firm opinion on the quality of upcoming BB10 devices and OS (although we harbor our doubts). On the other hand, we are absolutely convinced that, regardless of its quality, the structure of the industry means that there is virtually no chance that BB10 will meaningfully change RIM’s trajectory.”

RIM shares closed at $9.71, up 1.2 percent, today, and the stock continued to climb in after-hours trading.

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There’s a lot of attention and PR around Marissa, but their product lineup just kind of blows.

— Om Malik on Bloomberg TV, talking about Yahoo, the September issue of Vogue Magazine, and our overdependence on Google