RIM results are in

by Volker Weber

Revenue for the third quarter of fiscal 2007 was $835.1 million, up 26.8% from $658.5 million in the previous quarter and up 49% from $560.6 million in the same quarter of last year. The revenue breakdown for the quarter was approximately 75% for handhelds, 17% for service, 5% for software, and 3% for other revenue. Approximately 875,000 BlackBerry subscriber accounts were added in the quarter. At the end of the quarter, the total BlackBerry subscriber account base was approximately 7 million.

5% software revenue, 75% hardware? I have a suggestion: give away the server for free. Let IBM bundle it with Domino. And Microsoft with Exchange, if they feel so inclined, which I doubt. And then add lots and lots of new subscribers and sell handhelds as fast as you can.

Comments

Isn't that what the've been doing, albeit in a limited fashion, with their Quick Start Edition offer?

Jan-Piet Mens, 2006-12-22

The Quick Start Edition is only for Domino and includes ten CALs. For Exchange, Groupwise and also Domino they offer the BlackBerry Enterprise Server EXPRESS for free. But with the EXPRESS edition you only get one CAL.

Abdelkader Boui, 2006-12-22

BES for Groupwise currently includes 5 CALs.

Jan-Piet Mens, 2006-12-22

Your absolutely correct Volker. Absolutely. Everyone else may as well go home if they were to do that.

The device is what people care about - a free server is fuel to facilitate that fire. Trying to make money from the server is "penny wise and pound foolish". The extra devices they would generate in one year would dwarf anything they will *ever* make on the servers. Dwarf.

The bundling is an even more interesting angle if your Lotus ..

Volker you should have said

"And then add lots and lots of new subscribers and sell handhelds and Domino licenses as fast as you can."

You are a good mother Volker.

Stephen hood, 2006-12-23

Well, I can see how this idea would be great for BlackBerry..

:-)

However, IBM/Lotus has to be seen to be device agnostic. There are still people out there who make the Windows mobile platform work for them, and have spent considerable money on that. So just bundling BlackBerry Enterprise Server with domino would understandably piss those guys off..

So now its a choice.

Bear in mind that BEs server gives you far far more than just eMail. BlackBerry's big push next year should be applications - and how to get corporate applications onto handhelds. So hence the revenue stream from the BES server to encourage the developers to write good code, etc.

(If your wondering what I mean about applications, check out my View presentation on how to surface BlackBerry apps from a domino server in under an hour..

http://www.hadsl.com/HADSL.nsf/Documents/Deploying+Domino+Applications+to+the+BlackBerry!OpenDocument

)

---* Bill

Wild Bill, 2006-12-23

Bill, I don't think I should be punished because other people have spent money on windows mobile platform. That would be just as "unfair" wouldn't it? IBM still supports that platform, their not being any less device agnostic.

It wouldn't be IBM's fault because one of their partners is now providing their server free of charge. Microsoft is free to do the same. That's what competition is about. Microsoft has been doing this stuff for years..giving away stuff to build the client side market - because that's where the real money is. Isn't that part of the reason Domino and Notes don't have an even bigger market share than they should have? Oh and btw will give you a really great deal on Office if you put in Exchange as well. Come on.

As far as I understand the Sametime Gateway connectors for the public systems are free from IBM and Microsoft charges per user for it. Should IBM not do that because it might piss off people that use both companies software. I don't see a difference. They are competitors and Microsoft will try and put a stranglehold on this market as well. Why not undermine their ability to do so and have more control over your own future .. as well as making sure your customers have more choices in the future. That's more likely to ensure enough devices to be agnostic about.

As far as the application side that makes it *even* more important to do what Volker says, not less.

Look at the numbers above. Seeding the server market to expand applications and devices is a no brainer. It makes the ISV market much much healthier and robust. Penny wise and pound foolish indeed.

The Blackberry ISV market would grow (and needs to) much much much faster if

a) the server was free
b) ISV's knew the Domino market was now "on" by default.

Think long-term..

Look MS is spending huge amounts of money and getting their media friends to tell people that the PS3 is expensive in comparison to the Xbox 360. It's the only thing it can compete on. Now if you compare apples to apples the 360 is TWICE as expensive as a PS3 for a home entertainment center. TWICE the price. But somehow Time finds it horrendously expensive and not the Xbox 360?

They will attempt to do the same to the Blackberry market and then use their money and media influence to convince the market up is down and down is up. Your only inoculation is to make sure you have a healthy defense. Making the server free is an important step for RIM.

Think long-term...


Stephen hood, 2006-12-23

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I explain difficult concepts in simple ways. For free, and for money. Clue procurement and bullshit detection.

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