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AT&T Looks Beyond IPhone With RIM’s New BlackBerry

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RIM Shows New BlackBerry as AT&T Looks Beyond IPhone
The Blackberry Torch is held for display during its debut in New York. Photographer: Andrew Harrer/Bloomberg

Aug. 3 (Bloomberg) -- AT&T Inc., facing the eventual loss of its U.S. monopoly for the iPhone, debuted a new BlackBerry from Research In Motion Ltd. that will expand the carrier’s lineup of smartphones beyond Apple Inc.’s device.

The new handset, known as the Torch, has a touch screen and full Qwerty keyboard similar to those on RIM’s most popular BlackBerry models, the companies said today. The phone has a new operating system and Web browser, and will start selling Aug. 12 exclusively AT&T’s network for $199.99 with a two-year contract.

“One of investors’ main concerns as to AT&T’s wireless strategy has been its large dependence on the iPhone,” Jennifer Fritzsche, a Wells Fargo & Co. analyst, said in a note. “This new device will only help further increase the penetration of smart phones in AT&T’s base.”

AT&T has also been touting smartphones running on Google Inc.’s Android platform, and has said it will offer devices using Microsoft Corp.’s Windows Phone 7 software later this year. Rival Verizon Wireless plans to begin selling the iPhone in January, people familiar with the plan said in June.

AT&T has relied on its iPhone monopoly in the U.S. since the device’s 2007 debut to fend off Verizon Wireless and Sprint Nextel Corp. Dallas-based AT&T activated 3.2 million of the devices in the second quarter.

“We’re constantly bringing in new products; some are bigger than others and this happens to be a big one,” David Christopher, AT&T’s wireless chief marketing officer, said in an interview.

‘Very Good Upgrade’

For RIM, the Torch may be a product that helps it regain lost market share by combining the iPhone’s fingertip Web surfing with a physical keyboard useful for typing long e-mails.

RIM’s share of global smartphone shipments fell to 19.4 percent in the first quarter from 20.9 percent a year earlier, according to researcher IDC. Apple claimed 16.1 percent of the market, up from 10.9 percent a year earlier. HTC Corp. and Motorola Inc., which make smartphones running the Android software, also increased their market share.

RIM posted a video on YouTube demonstrating its new operating system, called BlackBerry 6, with a redesigned browser and touch-screen technology that allows users to zoom in and out of images using two fingers, like on the iPhone. The Torch’s 3.2-inch screen is smaller than the iPhone’s 3.5-inch display.

The operating system is “a very good upgrade to OS 5 as it fixes its browser and has a lot of good features,” said Ken Dulaney, an analyst at researcher Gartner Inc. in San Jose, California. “But it doesn’t have the look and feel of an Android or Apple operating system and I’m not sure it will achieve the goal of taking volume away from them.”

The Torch will also be sold at Best Buy Co., Wal-Mart Stores Inc. and RadioShack Corp. stores.

AT&T gained 10 cents to $26.69 in New York Stock Exchange composite trading at 4 p.m. It has lost 4.8 percent this year. RIM, based in Waterloo, Ontario, fell $1.45 to $55.53 on the Nasdaq Stock Market and has declined 18 percent this year.

To contact the reporters on this story: Hugo Miller in Toronto at hugomiller@bloomberg.net; Greg Bensinger in New York at gbensinger1@bloomberg.net

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

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