Late product launches harm RIM subscriber predictions

Company downgrades forecasts

Research in Motion has lowered its previous predictions of how many new BlackBerry subscribers it expects to sign up during both its current third fiscal quarter and the following fourth fiscal quarter. RIM blamed the likely drop-off in new subscribers on delayed launches of the latest BlackBerry handsets, according to a company statement.

The Canadian vendor is now expecting subscriber additions in its fiscal third quarter, which is due to close Saturday, to be about 8% lower than the 680,000-710,000 range it had estimated in September. At that point, RIM was banking on its BlackBerry 8700 Series for Edge networks and its BlackBerry 7130 Series for EV-DO networks wireless email devices shipping early this month.

For reasons the company didn't explain, the launch of the handsets was delayed, so customers had to hold off their expected purchases. Instead, the devices became commercially available this week, with general availability through retail outlets due to occur in early December.

RIM also thought it prudent to lower its new subscriber predictions for its fourth fiscal quarter, which ends March 4, 2006. The vendor is now expecting subscriber additions in its fourth quarter to be around 3% lower than the 775,000 to 825,000 it had previously forecast.

The company continues to peg third-quarter revenue in the US$540 million (NZ$777 million) to $570 million range and doesn't expect its previous fourth-quarter guidance to shift due to the lower levels of new subscribers.

It has been facing some tough times of late in the courtroom in an ongoing alleged patent infringement case filed against it by NTP. An important ruling in the case is expected shortly as RIM completes a work-around it claims sidesteps NTP's patents. It had appeared earlier this year that the two companies had settled the long-standing litigation, with RIM to receive a perpetual license to the disputed patents in exchange for $US450 million, but the deal fell apart in June.

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