Research In Motion Hits All-Time High as China Okays BlackBerry
Shares of Blackberry makerResearch in Motion hit a new all-time high Thursday after the Canadian company said it obtained clearance to sell its smartphones in China.
RIM shares added nearly 4%.
RIM Co-Chief Executive Jim Balsillie, speaking on a conference call with analysts last week, said the company was planning to serve corporate customers in key Chinese cities including Beijing, Shanghai and Guangzhou. The company has been trying to get permission to sell its products in China for eight years.
RIM’s move into China comes as it competes in the United States with Apple Inc.’s heavily hyped iPhone, which began selling in the U.S. last Friday. The iPhone can handle phone calls, e-mail, Web browsing, music and videos.
On Wednesday, Canadian newspaper Globe and Mail cited a manager in RIM's Beijing office as saying RIM will start selling its BlackBerry 8700g handset in China at the end of August and has almost 5,000 advance orders for the device from Chinese customers.
A RIM spokesperson could not immediately be reached for comment.
Morgan Keegan analyst Tavis McCourt said in a phone interview Thursday he thinks word of the company's entrance into China helped its stock, but called the news more media hype than anything that will really financially impact RIM in the near term.
"China is obviously a large market, but the number of consumers likely to buy BlackBerries is rather limited in China. Generally, its Europeans and American expats working in the major cities that are going to have the BlackBerry service," he said.
Still, over time, RIM's Chinese market will grow, as more consumers have jobs or lifestyles that require e-mail access, he said. But in the meantime, "the opportunity in China is dwarfed by the opportunity still in front of RIM in North America and Europe," he added.
Peter Misik, an analyst with Canaccord Adams, said he thinks RIM could also be benefiting from competitor Apple Inc.'s June 29 launch of the iPhone.
Non-AT&T carriers are aggressively pushing BlackBerry products to consumers, he said. AT&T's wireless unit is the exclusive carrier for the recently-released iPhone, which is a hybrid cell phone, media player and wireless Internet device.
"We're hearing cases where when the iPhone is selling out, AT&T is recommending the BlackBerry as an alternative," he said. AT&T is the exclusive provider of new Blackberry model, the Curve.
AT&T spokesman Mark Siegel said the company is focused on getting iPhones to those who want them, not on recommending another device.
"Our plan for the people who want iPhones is to get them their iPhones, period," he said.