It’s a single feature, iMessage. But its announcement yesterday was significant enough to warrant Morgan Keegan financial analyst Tavis McCourt cutting his price target on RIM stock to $49, down from $71, and reducing his rating to Market Perform, from Outperform.
iMessage is Apple’s answer to BlackBerry Messenger (BBM), a direct messaging system that will allow those with iOS devices to instantly message each other. Just as BBM is baked into the BlackBerry experience, iMessage will also be an integral part of iOS 5. iMessage will allow not just text, but photos, videos, contacts, and locations to be sent to any devices running iOS 5.
What is the rationale behind the downgrade? “BBM and IM broadly is irrelevant in the U.S. due to the low cost of texting plans,” McCourt is quoted as saying. “However, in the rest of the world, BBM has probably been the largest application driver of Blackberry success (don’t forget, RIM is still taking share in almost every country in the world outside the U.S.). The other significant drivers for RIM share gains are data compression, Blackberry Social Plans and enterprise security. Therefore, Apple has [not] knocked down all of RIM’s advantages with iMessage, but has the ability to work on the other advantages once Apple’s network/data centers are fully operational.”
It’s intriguing that Apple just adding a feature that BlackBerry has had for years would send RIM’s stock target price down. You would think that Apple is playing catch up here, but Apple is in the position of being the leader, yet with ‘missing’ features. Now that they have added iMessage, it only further solidifies their position. RIM has fewer and fewer things that they can trumpet as advantages over the iPhone. I guess the writing is on the wall. Or on iMessage.
Article Via Mac Daily News
Photo Credit: Apple