Are Unsold BlackBerrys Piling Up?
from the who-to-believe dept
When Research In Motion announced the settlement of its patent dispute with NTP, it also said the fight had hurt its sales, and it followed that revenue warning with another one last week. Now, some observers are seizing on the disappointing figures to point out the growing gap between the number of BlackBerry devices RIM sells wholesale and the number of new subscribers it signs up -- for instance, in the quarter ended March 4, RIM shipped 1.12 million devices, but added just 625,000 new subscribers. The company, which gets 70 percent of its revenues from device sales, says the gap is down to current subscribers upgrading their devices, but can't produce any specific data to back the assertion up. Perhaps seeing roughly 10% of all BlackBerry subscribers replace their device each quarter isn't so high, but if replacement sales are such an important part of RIM's business -- about a third of revenues, if the entire gap between device sales and new subs is made up of existing users replacing their devices -- wouldn't they want to have some solid data on it? The only bear cited in the article has shorted RIM and has investments in two of its competitors, so he's got an interest in seeing RIM's share price drop, but the company doesn't do a real convincing job of explaining itself, either.