The Early Bird Doesn’t Always Get the Worm

Diane is a member of The Motley Fool Blog Network -- entries represent the personal opinion of the blogger and are not formally edited.

Research in Motion (NASDAQ: BBRY) has been late in getting its new BlackBerry 10 operating system to the market. But expectations are that the new model will be well received and will juice sales at the struggling telecommunications and wireless equipment maker.

The new smartphones are set to debut on Jan. 30, and should be ready for sale within 30 days of the unveiling. The BB10 was supposed to launch in Q3 of 2012, but delays postponed the launch to Q1 of 2013. The extra wait time has created a torrent of buzz and has stalwart BlackBerry users salivating for the new device. The anticipation continues to swell as the launch date approaches. Hopes are high that the new device will be the answer to the ailing Research in Motion's prayers. The new BB10 could truly turn around or turn-off the Canadian company.

Those who have had the opportunity to test the BB10 are impressed.  A review on Digital Trends found the BB10 simple to use and smooth. A key feature that stands out is a home screen that takes a user right to recently used apps. The BB10 is capable of managing up to nine active applications at once, freezing others in the background, and positions them in a handsome tile grid that scrolls downward. Managing apps is one aspect smartphone makers have failed to successfully conquer.  Thus, BB10 makes a grand entrance with edge in that area.

A Wall Street Journal reviewer likes the new suggest word feature, which suggests words right on the keyboard, and allows users to swipe up on the suggested word to add it to a sentence. The BB10 keyboard also reads and remembers exactly where a user taps each key to better predict which letter to type. This helps to prevent trigger happy and fumbling fingers make fewer mistakes. These new improvements make the keyboard easy to use with one hand, because we always are multitasking with the other.

It's features like these that make the Blackberry keyboard king when typing long emails.

A few major U.S. carriers, like Sprint Nextel, demonstrated support for the new BB10 at the recent Las Vegas Consumer Electronics Show.

Shares of RIM have enjoyed a stellar run over the last few months, more than doubling since September of last year. Should BB10 sales get off to a strong start and momentum follow, RIM shares stand to enjoy a further upward ride.

Also providing an uphill push is Apple (NASDAQ: AAPL). Consumers and investors' love affair with Apple is waning at the moment, while RIM’s attraction is mounting. A cache of fresh reports reveal sales of Apple’s iPhone5 have not been as robust as expected. Scores of iPhone 4 users have been content to stick with their older phone since the only major improvement in the iPhone5 is an LTE chip (4G) that downloads data at a quicker pace. But with some carrier ads labeling the older iPhones as 4G, many users believe their older model phone, which isn't much different from the latest model, is as fast as the new one, while others don’t care at the moment. What Apple's followers care about and crave is cutting-edge products and improvements like those introduced under visionary Steve Job’s rein.

Following news that Apple cut its component orders for the iPhone5, citing weaker-than-expected demand, shares tumbled some 3.6%, or $18.55. Shares stumbled an additional 3% on Jan. 15, as investors are bracing for the worst when the iPhone, iPod, iPad and iTune parent company reports earning on Jan. 23 after the close.  Estimates are for Apple to earn $13.34 a share.  Any miss will mostly likely send shares reeling. As the old saw goes, “the bigger they are, the harder they fall.”

Meanwhile, Apple’s loss is RIM’s gain, as is Nokia's (NYSE: NOK) slump.  Nokia, once the biggest handset maker in town, continues to loose market share. The Finnish company is relying on its new Lumia phones, which run on Microsoft's Windows Phone software, to drag it up from its decline . We'll see how the company did in the fourth quarter on Jan. 24, but expectations are weak. Analysts expect Nokia smartphone shipments, which include the Lumias, to have slumped 65% to 7 million units in the quarter.

App developers and carriers are also hoping for a strong showing when the BB10 launches. Some 70,000 compatible apps are expected by the time BB10 hits markets. Plus, all major U.S., Canadian, and British carriers plan to offer BB10 devices as soon as possible.

The new BB10 will first be introduced as a touch screen model. It's coveted keyboard type device will follow, so the initial response could be a bit subdued.

The stakes are high for RIM to deliver for investors and users alike. Smart money investors (i.e. institutions) own some 60.57%. Insiders account for another 15.01%, according to the latest data. In addition, the loyal global BlackBerry user fan base is roughly some 78 million strong. Jefferies just raised its price target on RIM ro $19.50, pointing out that anxious investors awaiting the new BB10 have overlooked the possibility of BlackBerry licensing deals.


DianeAlter has no position in any stocks mentioned. The Motley Fool recommends Apple. The Motley Fool owns shares of Apple. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. Is this post wrong? Click here. Think you can do better? Join us and write your own!

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