iPad 3 Launch Puts Another Stake in RIM

by Tom Taulli | February 29, 2012 8:54 am

Innovation is at the core of Apple’s (NASDAQ:AAPL[1]) DNA. And the next product in the bloodline is the iPad 3, which is expected to be announced next Tuesday[2].

The buzz is that the device 3 will have an LTE chip, which will increase connection speeds by a factor of 2 to 3. Carriers like Verizon (NYSE:VZ[3]) and AT&T (NYSE:T[4]) have been investing billions to roll out the network infrastructures to support this next-generation technology. The iPad also will have a high-definition screen, as well as other bells and whistles. Is it any wonder that Apple has sold 55 million iPads during the past couple years? Breathtaking.

And then there is Research In Motion (NASDAQ:RIMM[5]). The anti-Apple.

The company has been exceedingly slow and can’t seem to figure out what customers want. Its tablet, the PlayBook, shipped just 150,000 units in the latest quarter (through Nov. 26) and had to take a $485 million charge for unsold inventory. Meanwhile, online retailer Amazon (NASDAQ:AMZN[6]) — not a gadget company — shipped nearly 4 million units of its first tablet try, the Kindle Fire, during the Christmas season.

The argument in favor of RIMM is that it has a lock on the corporate and government market, which likes the security and deep integration with Microsoft (NASDAQ:MSFT[7]) Office. But even this argument is getting weaker and weaker. The U.S. Bureau of Alcohol, Tobacco, Firearms and Explosives recently became the latest agency[8] to ditch BlackBerries for iPhones.

But the PlayBook has been a joke. For example, RIMM recently announced[9] that the device now boasts 10,000 apps. Of course, Apple has 150,000.

Oh, and the PlayBook now has native email!

In the meantime, Apple continues to rack up customers. In its latest conference call, CFO Peter Oppenheimer said, “Nearly all the top companies, within major Fortune 500 markets, including pharma, manufacturing, hospitality, consumer products, financial services, health care and retail are actively using iPad to improve workflows, business processes and customer engagement.”

This should be scary for RIMM investors. No doubt, the company’s corporate business is in peril. And unfortunately, there still seems to be no credible plan to turn things around.

Tom Taulli runs the InvestorPlace blog IPO Playbook[10], a site dedicated to the hottest news and rumors about initial public offerings. He also is the author of “All About Short Selling”[11] and “All About Commodities.”[12] Follow him on Twitter at @ttaulli[13]. As of this writing, he did not own a position in any of the aforementioned securities.

Tom Taulli is the author of various books. They include Artificial Intelligence Basics and the Robotic Process Automation Handbook. His upcoming book is called Generative AI: How ChatGPT and other AI Tools Will Revolutionize Business.

Endnotes:

  1. AAPL: http://studio-5.financialcontent.com/investplace/quote?Symbol=AAPL
  2. which is expected to be announced next Tuesday: https://investorplace.com/2012/02/apple-rumors-special-ipad3-debuts-march-7/
  3. VZ: http://studio-5.financialcontent.com/investplace/quote?Symbol=VZ
  4. T: http://studio-5.financialcontent.com/investplace/quote?Symbol=T
  5. RIMM: http://studio-5.financialcontent.com/investplace/quote?Symbol=RIMM
  6. AMZN: http://studio-5.financialcontent.com/investplace/quote?Symbol=AMZN
  7. MSFT: http://studio-5.financialcontent.com/investplace/quote?Symbol=MSFT
  8. recently became the latest agency: http://www.appleinsider.com/articles/12/02/28/atf_ditches_blackberrys_for_iphones.html
  9. recently announced: http://www.bloomberg.com/news/2012-02-28/rim-says-blackberry-playbook-now-has-about-10-000-apps.html
  10. IPO Playbook: https://investorplace.com/ipo-playbook/
  11. “All About Short Selling”: http://www.amazon.com/All-About-Short-Selling/dp/0071759344/ref=sr_1_1?s=books&ie=UTF8&qid=1302184310&sr=1-1
  12. “All About Commodities.”: http://www.amazon.com/All-About-Commodities/dp/0071769986/ref=ntt_at_ep_dpi_10
  13. @ttaulli: https://twitter.com/ttaulli

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