iPhone heading for the enterprise?

I don't know how successful this software developers kit will wind up being. I'm discouraged that Jobs keeps saying flash player sucks while iPhone users keep begging for a flash player. Like it or not, Jobs, flash has become an internet operating system standard... and its an opportunity to distinguish your phone from the rest of the pack. Flash mobility is rare and could be a breakout application to sell into that webby cult of artistes you call the Mac base. Unless you've got some other way to port flash to the iPhone, you're making a big mistake denying it to the base. If it's too big and slow, that's fine, let the end user make that decision. Wow, I feel ironically like I'm hurling stones at a tyrant with this Jobs ranting.

The iPhone does document rendering beautifully -- you really see the page just as it is. Unfortunately, the 8x11 paper standard makes everything look so tiny and far away on the iPhone screen that you have to spend 10 minutes squishing and unsquishing the document to get it to fit the screen just so. Fun at first, annoying as hell shortly thereafter.

I tried many times to defect from the Blackberry -- first to the Motorola Q (sad, I know) and then to the Treo. Neither of them worked very well or kicked the emails through instantaneously like the Blackberry does. I always had to go back. The iPhone push email through Yahoo was real push email. And it worked really well. I imagine they're going to have bridges to corporate email in the future. They've said they're going to have some enterprise solutions tomorrow.

I think RIMM could see a little near-term turbulence going into the Apple meeting. I'm likely to suggest buying the stock on weakness but I'll wait to see what Apple actually announces. No hurry.

On an almost related note, my wife is at the Apple store right now for her 9:50 Genius Bar appointment to have her iPhone repaired. The top half of the screen is completely dead to the touch.

Research In Motion (RIMM) In Motion

The company guides up subscriber additions but leaves revenues and EPS expectations unchanged -- so expect them to beat revenue and EPS expectations when they get around to reporting in March.

At some point in the next quarter or two, RIMM will release Blackberry OS 4.5 for the 8xxx series and I think it will be a meaningful upgrade as it will allow streaming media and the ability to shoot movies on their camera-equipped phones. Their consumer business is just beginning. Last quarter it was 34% of the overall subscriber base. Expect that percentage of business to grow rapidly.

I worry there could be some backup in the financial vertical over the coming months but if that's happening so far it's mighty well hidden.

Without being alarmist, I did want to point out an odd disclosure from the press release:

The number of net subscriber accounts and net subscriber account additions is
a non-financial metric and should not be relied upon as an indicator of RIM's
financial performance. The number of net subscriber accounts and net
subscriber account additions does not have any standardized meaning prescribed
by U.S. GAAP and may not be comparable to similar metrics presented by other
companies.


That's the first time they've used that particular disclaimer.

According to last quarter's press release, subscribers ended Q3 at "approximately 12 million" and this press release says Q4 will be "approximately 14 million". They say they added "15-20% higher" than their guidance of 1.82 million, which implies 2.1-2.2 mil subscribers. So 100-200k subscribers are either disconnecting or lost in rounding. It's totally impossible to draw a conclusion from this. Even if they did lose 200k subscribers, which seems like the worst case scenario, its 1.5% of the base and doesn't seem wildly high for a subscriber business.

Blackberries are damn sticky. I've never been able to get something else... and I've tried every time my contract has come up. No one does email on the cell phone as well. Not even close.

The upside in the current quarter implies further upside to consensus numbers, despite the new disclaimer. It's extremely likely we'll see estimates for '10 start to poke through $5.00. Suddenly RIMM looks incredibly cheap at 22* next year's estimates as of last sale at $110. Earnings estimates for 2009 will be somewhere between $4.00 and $4.25 I would guess -- a more somber 25-27*. They're practically growing at 100% on a y/y basis and this is no start-up. They have mass market appeal and scale. Any concerns about the financial vertical or the consumer spending cycle are trumped. At $200, yes, those are valid concerns. At $110 those concerns wind up being a missed opportunity and a heap of self-flagellation as you watch it go up without you.

Research In Motion (RIMM) Patents Surface

Ok, ok, that's not the new RIMM patent photo but its kinda funny.

Here's the real drawing:



Unwired Article on RIMM patents

The patent was filed on February 7, 2008. It's clear RIMM is hard at work on a Blackberry counter to the iPhone. This may be part of the 9000 series that's been speculated. This one has some kind of slider mechanism and a hinge that lets you angle the screen. In general I'm opposed to complicated mechanisms on top of technology, especially in portable devices where the oops-i-dropped-my-gizmo factor is so high. The touchscreen technology senses location, finger pressure and can handle multiple points of contact simultaneously -- at least in theory. Pressing on the screen to zoom in on an area strikes me as far less idiotic feeling than flicking the screen 300 times to get it sized right.

One day this product will be great for RIMM's stock (when it launches) but a patent is a far cry from product shipment. It's not actionable though it is noteworthy.