Research in Motion’s iPhone Killer Take 3

On Research in Motion’s last earnings call, June 24, an analyst asked the following, “Can you give us a sense of magnitude on new products and how much are they impacting the August quarter? How much of that is taken into the guidance?”  Jim Balsillie, CEO, said “…definitely some of this stuff is planned for this quarter. You bet.”

The stage was set.  New products would ship the quarter ending 8/28 or the company would risk missing earnings estimates again.   The company desperately needs a high-end premium priced phone to offset the declining average selling price of their existing phones.  Their stock price has been suffering due to this issue for some time.

Using Apple’s recent iPhone 4 roll-out as a guideline, June 7 Press Conference & Announcement, June15 Pre-Order and June 24 First Sale; RIMM had about another week before their Press Conference Invites had to go out.   On Monday, I tweeted the following:

On Wednesday, after the bell, the invites went out for an 8/3 event to introduce RIMM’s latest and greatest iPhone Killer.

RIMM needs to become a part of the discussion again.  It has quickly becoming an iPhone and Android world – making this product launch possibly the most important one in company’s history.    The buzz must be non-stop from announcement to launch.   Massive pre-orders and long lines will be critical.  Choosing AT&T for  iKiller #3 was a smart move.  Their Verizon customers burnt by the past two iPhone Killer attempts would be more skeptical.  RIMM needs customers to buy first and ask questions later.  Their AT&T customers may oblige.

I will be listening to the call intently on Tuesday.  There will be talk about new OS, the new Browser, the new this or that.  I will be focused on the release date.  Will it be released before 8/28?  If so, RIMM will sell a ton of phones before the end of the quarter and will most likely blow out their September earnings report.  If the phone is not released by the 28th the stock most likely will be put back in the penalty box for a few more months.

RIMM has a ton of work to do before the end of August.  However, based on the iPhone 4 schedule it is possible.  That being said, due to the Gizmodo iPhone scandal, we knew quite a bit about the iPhone 4 before the announcement. That was about month and a half before the actual product announcement.  What do we really know about RIMM’s new phone? RIMM has released a couple of animated teaser videos, but Thursday was the first time I saw a video of the OS running on an actual phone.

My guess is that Research in Motion will upgrade many of its most dedicated existing customers immediately.  Many of their next level of customers, after years of disappointments,  most likely won’t even kick the tires (read My RIMM Rant).  Good luck extending beyond the existing customer base – very few will take a chance on a first generation OS.

I saw a quote today. I don’t know if it was accurately captured, but if it is – it’s a hoot.

“As long as the new phone isn’t a RIMM killer it’s terrific.” Karen Finerman from CNBC

If I am correct the phone will be a RIMM killer. Not a company killer, but an ambition killer.  Time to layoff the iPhone Killer talk.  There is nothing wrong with being a niche business phone provider.

Disclosure: Short RIMM.