John Paczkowski

Recent Posts by John Paczkowski

RIM: Could Be Worse, Could Be Raining

It says a lot about Research In Motion’s current situation that the company’s shares can rise on an analyst upgrade to market perform announced in a note entitled, “RIMM: Things Can’t Get Worse in the Foreseeable Future.”

But after a near 40 percent decline in share price since the beginning of the year, RIM and its investors are taking anything they can get–even a disdainful, back-handed upgrade from Bernstein & Co.’s Pierre Ferragu, a longtime RIM pessimist with a particularly bleak view of the company.

To Ferragu, RIM is a company with a broken brand and a management in denial of the challenges it faces. That said, its situation isn’t deteriorating so rapidly that it will frighten the market beyond its current negative sentiment.

“RIM has been for 10 years a premium brand, supported by a fundamentally differentiated product: the only mobile phone offering proper email,” Ferragu argues. “This time is now over; mobile email has become a commodity, offered at no extra cost on any smartphone platform. We also argue that the iPhone established a new innovation cycle in which RIM became a lagging follower, running behind in terms of application store and browsing capabilities. As a consequence, we believe RIM’s high level of profitability is at risk.”

And if you think growth in international markets will offset any of these risks, don’t. The challenging business trends RIM faces in the States will inevitably migrate abroad as well.

Says Ferragu, “…We expect consumers’ awareness of the superiority of Apple and Android phones to grow very fast in the rest of the world and these very same competitors to expand quickly in lower price points. In such a context we would expect RIM’s trajectory in international markets to get closer to the one observed so far in North America.”

So… good news. Could be worse, right?

Twitter’s Tanking

December 30, 2013 at 6:49 am PT

2013 Was a Good Year for Chromebooks

December 29, 2013 at 2:12 pm PT

BlackBerry Pulls Latest Twitter for BB10 Update

December 29, 2013 at 5:58 am PT

Apple CEO Tim Cook Made $4.25 Million This Year

December 28, 2013 at 12:05 pm PT

Latest Video

View all videos »

Search »

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