Research In Motion Ltd plans to start selling its BlackBerry e-mail phone in China this year, tapping the world's largest handset market as it expands beyond North America. The shares rose 9.8 percent.
The BlackBerry 8700 model will begin shipping to business customers in China through France's Alcatel-Lucent, Research In Motion said yesterday. Beijing-based China Mobile Ltd (中國移動), the nation's biggest wireless carrier, is providing local BlackBerry service in the country.
China has more than 500 million mobile-phone users, according to government data, and its growth is surpassing that of North America. Alcatel-Lucent, a "pioneer" in Chinese phone sales, will help the BlackBerry reach subscribers in the country, Oppenheimer & Co analyst Lawrence Harris said.
PHOTO: AP
"The long-term growth potential here is significant," New York-based Harris said in an interview. "The market is still growing rapidly. The timing could be just right."
He rates Research In Motion shares "neutral."
Research In Motion, based in Waterloo, Ontario, rose US$11.15 to US$124.53 at 4pm New York time on Tuesday in Nasdaq Stock Market trading, the most in more than two weeks. The stock has almost tripled this year.
Research In Motion had its price estimate raised to US$150 from US$125 at UBS AG after announcing a plan to start selling its BlackBerry e-mail phone in China.
The deal may open opportunities for "deeper penetration into multinationals," analysts including Jeffrey Fan said in a note dated yesterday.
"Prior to this agreement, BlackBerries had to be purchased outside of China and then activated on China Mobile," they wrote.
UBS kept its "buy" recommendation on Research In Motion shares.
Research In Motion co-chief executive officer James Balsillie has enlisted more than 300 phone-service providers around the world to expand beyond North America, which accounts for most of Research In Motion's revenue. Paris-based Alcatel-Lucent, the world's largest maker of telecommunications equipment, already has the right to sell BlackBerrys in Africa and the Middle East.
China's economy grew 11.9 percent on an annual basis at the end of the second quarter, about six times the US rate.
The BlackBerry will face competition from Nokia Oyj, the market leader in China, as well as lower-cost local handsets such as the RedBerry, which China Unicom Ltd (
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