Heaping speculation on rumour here, but occurs to us that the potential hiring freeze at Bloomberg LP could be a negative sign for Research in Motion (RIMM).
The Bloomberg story is that Bloomberg’s data terminal business is losing clients as a result of the credit crunch because whole Wall Street departments are getting vaporized (no reason to have a terminal in an office filled with tumbleweeds). RIM bulls, meanwhile, argue that the company will be unscathed by the financial-services carnage, because BlackBerries have become the equivalent of a fifth limb for employees: they won’t give them up until the repo-men rip them out of their cold, dead hands.
And we buy that argument: BlackBerries won’t fall prey to generic belt tightening. However! If whole departments are blown out, their BlackBerries subscriptions will go with them.
One member of our research team argues that BlackBerries have become so crucial to the life-functions of financial-services employees that fired workers will just immediately go out and buy new ones. Another member (this one) is sceptical of that argument. A third member argues that, regardless of what happens in financial services, RIM will be saved by the consumer smart-phone market, which is exploding. All the more reason to listen closely to RIM’s conference call tonight.
Business Insider Emails & Alerts
Site highlights each day to your inbox.