RIM Unveils New BlackBerry Operating System to Challenge Apple, Google

Research In Motion Ltd. (RIMM), looking to regain sales lost to Apple Inc. and Google Inc. (GOOG), unveiled a new operating system designed to help developers create applications for its PlayBook tablet computer and new smartphones.

The software, called BlackBerry BBX, bridges RIM’s current BlackBerry operating system and its newer QNX platform, co-Chief Executive Officer Mike Lazaridis said today. That should remove developer “roadblocks” and make it easier for them to build applications for RIM. Lazaridis didn’t say when the new BBX program will be available.

“I can’t say how important you are to us,” he told the audience of developers at the BlackBerry DevCon conference in San Francisco. “It’s a really exciting time for BlackBerry developers.”

RIM, based in Waterloo, Ontario, is banking on the new software to encourage programmers to build more applications for its smartphones and tablet computers as consumers increasingly use mobile devices to watch video, listen to music and browse the Web. The company’s BlackBerry phones have lost market share to Apple’s iPhone and devices running Google’s Android software, which offer a wider selection of applications. RIM’s PlayBook has sold fewer units than analysts estimated.

Near Term

“It’s all great stuff but there’s little here to change trends near term and not a lot of information on when all this software is available,” said Tavis McCourt, an analyst at Morgan Keegan & Co. In Nashville, Tennessee who is attending the conference. He rates RIM “market perform.”

RIM did announce that a new beta version of its PlayBook software is now available for developers that allow them to create PlayBook versions of their existing Android applications. While that was expected, the company didn’t say when a dedicated e-mail program would be available for the PlayBook.

RIM rose 3.6 percent to $23.21 at the close in New York. It has lost 60 percent this year.

The company had said in May that a software upgrade for the PlayBook that has built-in e-mail, contacts and calendar programs would come this summer. Last month, Lazaridis said RIM would issue that upgrade in October.

Shipments Dropped

PlayBook shipments dropped by more than half last quarter following criticisms of the tablet’s e-mail shortcomings and lack of consumer applications. Deliveries to retailers like Best Buy Co. fell to 200,000 units from 500,000 in the previous quarter as Apple Inc. (AAPL) shipped 9.25 million of its market-leading iPad.

RIM’s U.S. smartphone market share fell to 20 percent in the quarter through August from 25 percent three months earlier, according to ComScore Inc. (SCOR) Apple rose 0.7 percentage points to 27.3 percent while Google’s Android platform climbed to 44 percent from 38 percent.

RIM didn’t give any details today as to when its first phones built with QNX will be available. Co-CEO Jim Balsillie has said in the past that the first of those would be available in early 2012.

The company has struggled to steer discussions about RIM away from a series of recent headaches and toward new products. Last week, a RIM network failure that began in the U.K. spread to several continents, leaving millions of customers without service for days. Lazaridis last week apologized, saying the company had “let many people down.”

Investors Involved

Toronto-based Jaguar Financial Corp. (JFC) this month called for a change in management to shake up RIM’s strategy and said it had the support of investors holding 8 percent of RIM’s stock. Jaguar said today in a statement it had arranged a meeting with two of RIM’s independent directors, John Wetmore and John Richardson, before the RIM’s legal counsel canceled the meeting.

Northwest & Ethical Investments LP in June called for a split of the roles of chairman and CEO, shared by Balsillie and Lazaridis. Northwest & Ethical then agreed to withdraw its proposal shortly before a shareholder vote in July, after RIM said it would form a committee to study Northwest’s proposal and report back by January 2012.

To contact the reporter on this story: Hugo Miller in Toronto at hugomiller@bloomberg.net

To contact the editor responsible for this story: Peter Elstrom at pelstrom@bloomberg.net

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