RIM Sent Reeling
At the midpoints of that range, the company is expecting about 65 cents a share in earnings on sales of roughly $537.5 million in the third quarter. Analysts have predicted a profit of 64 cents a share on $522.4 million in sales for the period.
Additionally, company officials attempted to address investors' concerns about the competitive threat from Microsoft (MSFT). The software giant plans to update its Exchange e-mail software later this year to incorporate features similar to RIM's BlackBerry service. Some analysts have worried that Microsoft will steal some of RIM's market share because Microsoft is offering the wireless e-mail features for free as part of the Exchange upgrade, while RIM charges customers for its BlackBerry server software.
Microsoft's service may be nominally free, but that doesn't mean that running the service won't come at a cost, said Balsillie. Companies will have to take the time and expense to upgrade to the latest version of Exchange, he noted. The handheld pagers that can tap into the Exchange service are typically pricey, he said. And the service will be data-intensive, meaning that corporations that use it will have to sign "expensive" service agreements with wireless carriers, he said.
"If someone is representing that it costs less, that's not a true statement," Balsillie said. "Far from costing less, it's quite a bit more expensive."RIM has a leg up on Microsoft, because the architecture behind its system offers better security than Exchange's system, he said. Meanwhile, RIM's system will work with pagers from a far greater number of manufacturers running a broader array of operating systems, he said. Corporate information officers "want a generic platform" like RIM's, Balsillie said. "They've told us that unanimously."
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