MONTREAL - BlackBerry maker Research In Motion Ltd. is expected to continue solid international growth with its high-end Bold and a lower-end model when it releases its fourth-quarter results on Wednesday.
But the challenge will be to continue to appeal to consumers, especially in North America, with a faster web experience and easier access to software applications as it competes with the iPhone and Android smartphones, analysts say.
PCMag Mobile analyst Sascha Segan said consumers want the same experience on their smartphones as they have on their personal computers.
"The iPhone and the Android platforms provide a far, far better web and apps experience than the BlackBerry," Segan said from New York.
RIM (TSX:RIM), already dominant among business users for its secure, direct delivery of email, has been going after the consumer market where the iPhone has created a lot of buzz with its emphasis on software applications like games, maps and other programs.
"Everything that RIM has brought to the table still holds true, but Apple has taken it to the next level and said, 'Let's go beyond email,"' said analyst Nick Agostino of Mackie Research Capital in Toronto.
While the BlackBerry is still the dominant smartphone in North America with the iPhone in second place, it's about staying relevant, Segan said.
"People are starting to get afraid that RIM is relying on its laurels a bit," said Segan, managing editor for PCMag Mobile.
Broadpoint AmTech analyst Mark McKechnie called the updated BlackBerry Bold and the entry level BlackBerry 8520 the "dynamic duo" that are driving international growth in places such as Europe and India.
But McKechnie said more is needed as Apple's iPhone grows in popularity, also citing a better web browser and easier access to software applications.
"To tap into some of the growth in consumer smartphones as the price points come down and that market opens up, they need to offer something a bit more compelling," McKechnie said from New York.
The Waterloo, Ont.-based company, which is expected to report fourth-quarter earnings Wednesday, is expected to introduced a new web browser for Internet surfing on the BlackBerry in June.
Agostino said RIM's growth could reach a point where roughly 40 per cent is outside North America, where BlackBerrys are purchased at lower prices without contracts and are adapted to local markets.
"Obviously, there's still room for growth in North America, but where there's ample room for growth is outside it because penetration rates are that much lower," he said.
Analysts are expecting earnings per share for RIM in the fourth quarter of fiscal 2010 to be between $1.27 and $1.32 and revenue between $4.3 billion and $4.5 billion.
Morgan Stanley analyst Ehud Gelblum said even though RIM's operating system lags behind Apple, Android and Palm in consumer-focused features, he believes that's less important in international markets where there's untapped opportunity for mobile email.
"We believe the rapid growth of the smartphone market coupled with RIM's focus on international markets should drive unit growth, offsetting potential share loss to Apple and Android in North America," Gelblum wrote in a recent research note.