Research In Motion (NASDAQ: RIMM) is launching a new high-end version of the BlackBerry aimed at its core base of business users, but it hopes the sleek device will also catch on in the broad retail market.
Shares of RIM jumped on Monday, climbing C$6.20, or 4.7 percent, to C$139.55 on the Toronto Stock Exchange shortly after the opening bell. In New York, RIM was up $5.99, or 4.5 percent, at $138.76.
The BlackBerry Bold, as the new smartphone is called, is the first BlackBerry to support high-speed HSDPA
“It’s really a step up in function in many core aspects of the system,” RIM’s co-CEO Jim Balsillie said in an interview.
The smartphone rolls out globally this summer and will cost between $300 and $400. AT&T will be its lead carrier in the United States.
Citi Investment Research analyst Jim Suva wrote in a note to clients that the timing of the launch of the third-generation smartphone was ahead of his expectations. Third generation, or “3G,” essentially refers to advanced and high-speed wireless services.
“We had expected a 3G device later this year,” he wrote. “We estimate the Bold could increase RIM’s quarterly shipments by 200,000 to 400,000.”
While Waterloo, Ontario-based RIM hopes the Bold will entice corporate users to upgrade the handsets they currently use, Balsillie said he “wouldn’t be surprised if it gets picked up by the consumer.”
The device will be a test of whether the shaky U.S. economy is making corporations less willing to spend on new wireless hardware. Some analysts have expressed concerns that companies will delay upgrades or cut back on spending on items such as the BlackBerry.
RIM helped dispel such worries last month when it delivered a higher fourth-quarter profit and a robust outlook.
UBS analyst Jeffrey Fan wrote in a note to clients he expects the company to launch between three or four new devices this year.
“We believe RIM’s broadening portfolio should widen its appeal to the mass market,” he wrote.
The Bold features the most vivid display ever on a BlackBerry, a 2-megapixel camera with video recording capability and a media player for watching movies and managing music collections.
This isn’t the first time a BlackBerry has been loaded with multimedia features to catch the eye of the retail customer. RIM has actively worked at diversifying its client base away from the executives, lawyers and other professionals who use the BlackBerry for sending secure wireless e-mail.
More than a third of RIM’s 14 million subscribers are now classified as nongovernment and noncorporate.
This pursuit of consumers has put RIM in increasingly direct competition with devices such as Apple’s iPhone, which target the broad consumer market.
Still, Balsillie said the Bold is aimed first and foremost at the business, or enterprise, audience.
“It’s pretty fair to say that the Bold does quite a job for cementing our leadership in the [enterprise] side,” he said. “We understand our roots and we understand the priority there.”
RIM also announced that, along with Royal Bank of Canada and Thomson Reuters, it will launch a $150 million venture capital fund that will invest in applications and services for the BlackBerry and other mobile platforms.