Financial analysts can't seem to make up their minds about the prospects for Research In Motion, (RIMM) but deep in the heart of the company's home base of Waterloo, Ont., Wes Worsfold is still a believer.
The president of Motek Mobile and the coordinator of the local BlackBerry Developer Group, Worsfold is among those people who are focusing less attention on the ups and downs of RIM's stock -- which closed up 4 per cent at US$11.54 in New York on Thursday — but on creating the kinds of consumer apps and games that will make people want to buy the next-generation BB10-based devices.
RIM's stock rose 2.25 per cent to US$11.8 on the Nasdaq in early afternoon trade Friday.
"Developing apps for RIM is streamlined," he says. "There are lots of development options and help and support is always available from the RIM dev relations team. We can submit apps for BB10 in AppsWorld today."
Sure, but will anyone in the outside world care? That's the question investors have been grappling with this week as they try to figure out the best course of action after RIM's previous share rally crashed in the wake of a legal dispute with Nokia over WLAN patent royalties.
Then Goldman Sachs upgraded its rating to "buy" and raised its price target from US$9 to US$16. There are still plenty of dissenters among financial analysts, however, and the BB10 platform and device launch is still almost two months away.
Kevin Restivo, lead mobility analyst at market research firm IDC, suggested it might be better to ignore any extreme views on RIM's outlook in favour of a more balanced perspective.
"There's still going to be growth, but it's a question of how much growth," he said. "The new management has been doing a good job of trying to turn the ship around, but over time RIM is faced with much steeper competition ... they're becoming more of a niche player than the RIM of old."
Here's the problem: RIM will probably face slower growth in North American markets where more advanced networks have been deployed, Restivo says. It's different in emerging markets, were 3G is considered state of the art and you'll still see the occasional lineups for new BlackBerry smartphones.
Although BB10 seems to be impressing the people who have gotten an early look at it, keeping the loyalty of developers like Worsfold is critical, because if BlackBerry's apps aren't interesting to consumers, the hardware differences won't really matter.
BYOD landscape more important
RIM is now operating in a much different environment than it did a few years ago. The company made its name by becoming the mobile phone of choice among businesses, which purchased them en masse and issued them to employees. It doesn't work that way anymore. The biggest trend in technology this year has been what's called the "bring your own device" (BYOD) movement, where employees demand to have the phones they use on their personal time to be connected to their company's network.
Investors need to understand the BYOD factor because it will have the biggest bearing on RIM's success over the long term. It's not about RIM landing another big corporate account, because the BlackBerry is no longer a corporate device. It's one of many choices in a consumer-dominated landscape, part of the Apple-to-apples comparisons that will require winning over individual subscribers one by one.
Popularity contests aren't easy to predict, which could be why RIM's share price has been so volatile. Maybe it's best to think about it this way: no one knows if the BlackBerry will win the contest, but it's probably got a good shot at being one of the finalists.