Yesterday, the Chief Financial Officer of the Chinese tech
giant Lenovo announced that the company is looking for several
acquisition targets, one of which is
Research In Motion Ltd.
). The beleaguered BlackBerry handset manufacturer is struggling
hard to regain its lost glory in the global smartphone market
under severe competitive pressure from
) developed iPhone and
) developed Android-based smartphones.
We believe a real turnaround of Research In Motion will take
more time than previously expected as we remain uncertain about
when the company will achieve profitability.A change in revenue
model of high-margin Services segment and a drop in BlackBerry's
global subscriber base are other near-term concerns. However,the
market is eagerly waiting for the company's next-generation
Blackberry 10-based (QNX software) smartphones, slated for launch
onJan 30, 2013.
Management has high hopes on this operating system as it is
believed to be different from the existing products in the market
with respect to navigation, software integration, speed and
convenience of gesture reorganization, touch screen, and unique
security. At present, 150 carriers have given a trial run of this
product and 120 business enterprises have tested its Enterprise
services beta programs.
Research In Motion, once the global leader of smartphones and
), the former king of the global mobile phone segment have been
struggling since the last 3-4 years, as both of them failed to
identify how consumers' preferences are changing and considered
their legacy operating systems as cash cows for a long time.
Regardless of the long-time rumor of a possible sale of
Research In Motion, we believe nothing will materialize
immediately. On the other hand, if BlackBerry 10 based devices
also fail to get commendable market traction, then the chance of
Research In Motion's wind up will hasten. At present, Nokia has a
Zacks Rank #1 (Strong Buy), while Research In Motion, Apple and
Google, have a Zacks Rank #3 (Hold).
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