Thursday, December 22, 2005

Blackberry back on the offensive - can it last?

Balckberry's owner RIM finally seems back on the offensive as their latest quarterly numbers proved solid, including new subscriber numbers and as a US judge seemed to support their position vis a vis the NTP patents.

Blackberry boosted their subscriber numbers by 645,000 in the 3rd quarter, taking total subscribers to 4.3M. It now looks like they will get past the magic 5M number by the end of their 4th quarter. Also net income increased to $120.1M, or 61 cents a share, from $90.4M, or 46 cents, a year earlier on sales that rose by 53% to $561M.

The PTO (Patent & Trademark Office) took the unusual step of notifying both companies that it expected it would reject the five patents held by NTP in its final rulings and described NTP’s arguments as “non-persuasive”. The office has issued preliminary rejections of all five wireless e-mail patents.

Meanwhile Judge James Spencer, the US district court judge overseeing the infringement case, has set a timetable for hearings on issuing an injunction against RIM that could coincide with the timing of the patent office’s final rulings, now expected as soon as mid-February.

So 2005 seems to be ending on a better note for Blackberry. They need it, they've had one tough year. Unfortunately it still doesn't change things for me. I believe that 2006 will bring harsher challenges for Blackberry in terms of competitive offerings and real market challenges from both Microsoft and Nokia.

Blackberry's vital head start is fading fast. They should have gone further this year and I fear that the NTP patent will prove long term damaging from the momentum it has lost them.

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