Is $RIMM new OS really that great?

First off, this is not a post about the technical superiority of any OS.

Secondly, I am vested with a SHORT position on RIMM. So, read this with a huge pinch of salt.

For the past few days, the media has been reporting Mr. Leon Cooperman’s ownership of 1.42 million of $RIMM  shares as of Sept 30. Clearly, this suggests that the shares were bought between July to September. As we can see from the chart below, the price range from $20 to around $32 during that period.



My guess is his entry will be around $25.

During that period, the common reasons to buy RIMM are:

  • US$25B cash they have
  • Little or no debt
  • P/E of less than 10
  • Corporate entreprise still uses RIMM
  • Emerging markets are growing (despite the loss in North America)
And still RIMM falls hard. Not only does it go below $20, it breaks a critical support at around $18.50 . I recall when RIMM has the service outage, it was holding its price fairly well. What is causing the drop?
Now, back to Mr. Leon Cooperman. A Bloomberg article carries the headline RIM’S NEW OPERATING SYSTEM WILLL ‘SURPRISE’, COOPERMAN SAYS.

I have a lot of respect for Mr Cooperman for being a successful fund manager. However, I cannot agree with the statement. Just because the new operating system ‘surprises’ does not mean it can turn the company around. If that is the case, Palm will have an easy walk in the park with their webOS when it first launch (granted, Palm’s financial position is nothing to brag about).

In this new war for the ‘tablet/smartphone’ market share, it is not the device or the widget that is creating the turn. With iOS and Android cornering the major bulk of the market share, what else is left for RIMM? Microsoft will also be pursuing this market together with Nokia. As far as the ‘device’ market share is concerned, RIMM is up against Apple, Nokia, Samsung, HTC and many more.

In terms of vertical markets like Music, Videos, Publishing, Applications and Software, RIMM is losing developer base and competing with Google, Apple and Amazon in creating valuable relationships with various verticals customers. For example, Amazon most and Google most likely own the Publishing space. Where does all these leave RIMM? Will RIMM be able to replace Apple’s iTunes and their relationship with the music labels?

Internally, RIMM is losing a lot of executives including Top Execs heading the emerging markets. If this is not a sign of a sinking ship, what is? Imagine, the various Heads of your fastest growing markets are jumping ship?

RIMM has totally lost its momentum on Innovations, Growing the Community, and keeping their top executives. Meanwhile, competitors continue to gain market share at their expenses.

Anyone running a race will know how difficult it is to regain the top position once you lose the focus and momentum. This is where RIMM is at. And technically, the chart shows continue bearish movement to come.

At best, a technical rebound. However, with 5 gap down in 1 year, there is very little hope for RIMM.


$AAPL . Impact of iPhone (vs $MSFT)

When the iPhone was launched, Microsoft’s CEO Steve Ballmer laugh at the price tag, ‘missing entreprise features’, and how it will not gain significant market share.

Here’s the YouTube video to show:

Fast forward to 2011 (and we are already in Q4 2011), let’s just take a look at how MSFT performed over the last few years (from 2007)


Yahoo (YHOO) : Quick Glance

A quick review of Yahoo:

1. Bloomberg reported that Microsoft is not interested to buy Yahoo (YHOO)

April 22 (Bloomberg) — Microsoft Corp. Chief Executive Officer Steve Ballmer said he’s not interested in buying a hardware company or Yahoo! Inc.

“I have no idea why a software company would be interested in buying a hardware company,” Ballmer said at a conference in Cairo today. “We don’t want to buy a hardware company.”

Here’s something to think about. Just because Microsoft is not buying Yahoo, that doesn’t mean they can’t invest in Yahoo, right?

What  is stopping them from putting money or working out some form of partnership with Yahoo?

Let’s just go back to the when Steve Jobs went back and head Apple. Remember the US$150 million deal with Microsoft? Steve got ‘booed’ for that. Yet, that US$150 million gave Apple a chance to turnaround.

At this moment, it is anyone’s guess what kind of partnership both Microsoft and Yahoo will enter into. It is safe to say that if they want to put a dent on Google’s revenue for advertisement and search engine related stuffs, they need to change the game plan. There is no use trying to play catchup in the search engine area. Google did not do that when they started. They simply blew the competition away. The window of opportunity for better search engine is gone for now. With regulators demanding that data be kept for shorter timeframe, I believe there is only so much the search engine capabilities will improve.

2. Daily Chart and Weekly Chart reviews

Daily Chart

2009apr-yahoo-inc-800x600On the Daily Chart, yesterday, YAHOO went as high as hitting the 200 Day Moving Average before retreating.

At this moment, it is still unable to break through this resistant.

On the Weekly Chart, we can see that it is hitting straight into the kumo.


3. Possible catalyst: a deal with Microsoft

4. Risk : Advertising revenue across the board is expected to remain week for 2009.

5. Others: Will Yahoo-Samsung interactive TV (iTV) deal be  a potential winner?