February 12, 2007 / 3:21 PM / 11 years ago

RIM co-CEO doesn't see threat from Apple's iPhone

TORONTO (Reuters) - The recent launch of Apple’s (AAPL.O) iPhone does not pose a threat to Research In Motion Ltd.’s RIMM.O RIM.TO consumer-geared BlackBerry Pearl and simply marks the entry of yet another competitor into the smartphone market, RIM’s co-chief executive said in an interview.

“It’s kind of one more entrant into an already very busy space with lots of choice for consumers,” Jim Balsillie said of Apple. “But in terms of a sort of a sea-change for BlackBerry, I would think that’s overstating it.”

Balsillie made his comments as Waterloo, Ontario-based RIM launched on Monday the slimmest BlackBerry thus far. Known as the 8800, the new model is a full-keyboard device equipped for the first time with a built-in global positioning system.

“It’s definitely the thinnest BlackBerry yet ... and definitely the premium product for the broad audience of mobile professionals,” he said. He added that RIM expects some people using earlier versions of the full-keyboard BlackBerry will choose to upgrade to the new model.

RIM’s shares were up 70 Canadian cents, to C$157.90, in morning trading on the Toronto Stock Exchange. Earlier, its U.S.-listed shares gained more than 1 percent in electronic trading before the opening bell.

Unlike the retail-aimed Pearl, which debuted to rave reviews in September, the 8800 is the latest version of the ubiquitous hand-held e-mail device aimed at the professional market. It can play music and videos and will be available first in North America through AT&T (T.N), selling for $299, Balsillie said.

While the BlackBerry is hugely popular among business, legal and other professional users, it has yet to gain the same widespread acceptance among retail customers.

It was to that end -- the penetration of the untapped retail market -- that RIM launched the Pearl and Apple launched the iPhone.

    Balsillie said the iPhone’s launch validates the thinking that multimedia features such as music should be expected in cellphones.

    But while the Pearl received great response, some analysts questioned Apple’s decision to price its smartphone at a relatively steep $499 for the 4-gigabyte model. Cost has been a key obstacle in turning regular cellphone users into users of the more expensive handheld devices. The Pearl now sells at T-Mobile for $149.99.

    But other observers cautioned that despite the lofty price tag that appears aimed at top-end retail users, the iPhone could spell trouble for RIM’s Pearl as it further overcrowds a market already bursting at the seams with new offerings.

    Aside from RIM and Apple, companies including Nokia NOK1V.HE (NOK.N), Motorola MOT.N, Samsung (005930.KS) and Palm PALM.O all offer smartphone products.

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