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RIM Puts On Good Show, Buys Time

NEW YORK, (TheStreet) -- Research In Motion (RIMM) teases and pleases with touch-screen demonstration and more promises of new phones.

After a dismal introduction of two retooled phones to open its annual wireless enterprise summit in Orlando, Fla., Monday, RIM executives fired up the crowd with a preview of a long-awaited update of its operating system.

Blackberry Bold 9650

A BlackBerry video presentation of the new software showed a touch-screen-controlled run-through of the usual gems like media player, onscreen Qwerty keyboard, Web browsing and social network feeds like Facebook. The BlackBerry maker nailed the demo, though the product won't be available until sometime in the third quarter.

In addition to the upcoming RIM OS 6 software, company executives hinted that new BlackBerries were coming this fall.

OK, forget the BlackBerry spring surprise, it looks like that may be postponed until fall. Crushed? Hardly, the BlackBerry has already been bruised for software neglect. It's the upgrade that matters now.

While far from concrete, the pitch was enough to keep analysts optimistic. It was a leap ahead to regain cool, according to one shop.

The boost in analyst confidence and a 3% gain by the stock over the past two days underscores RIM's relatively solid hold on the smartphone market. This niche has been durable despite RIM's aging operating system, and its failure to deliver a winning touch-screen phone, to answer the Apple (AAPL) iPhone.

RIM's resilience has a lot to do with its indispensible role as mobile email device for hard-charging professionals. It also speaks to the spread of the BlackBerry beyond business users to consumers who embrace the messaging service.

This underlying strength of the BlackBerry email application coupled with a Web-friendly operating system gives RIM a decent position in the smartphone race, say fans.

"We believe RIM has an opportunity to gain share in Europe, Latin America and Asia Pacific," Morgan Stanley analyst Ehud Gelblum wrote in a research note Tuesday.

Pointing to the small proportion of smartphones in big international markets, and RIM's small slice of the business there, Gelblum says: "RIM has barely scratched the surface."

With the already competitive market set to greet new phones like Verizon's Incredible, Nokia's N8 and a new iPhone, RIM's enviable cushion won't remain comfortable.

--Written by Scott Moritz in New York.

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