Blackberry 2006 Annual Report Download - page 13

Research In Motion Limited • Incorporated Under the Laws of Ontario (In thousands of United States dollars, except per share data, and except as otherwise indicated)
Annual Report 2006 11
For the years ended March 4, 2006, February 26, 2005 and February 28, 2004
These factors should be considered carefully, and readers should not place undue reliance on RIM’s
forward-looking statements. RIM has no intention and undertakes no obligation to update or revise any
forward-looking statements, whether as a result of new information, future events or otherwise.
Overview
RIM is a leading designer, manufacturer and marketer of innovative wireless solutions for the worldwide
mobile communications market. Through the development of integrated hardware, software and services
that support multiple wireless network standards, RIM provides platforms and solutions for seamless
access to time-sensitive information including email, phone, short messaging service (SMS), Internet and
intranet-based applications. RIM technology also enables a broad array of third party developers and
manufacturers to enhance their products and services with wireless connectivity to data. RIM’s products,
services and embedded technologies are used by thousands of organizations around the world and include
the BlackBerry® wireless platform, software development tools, radio modems and other hardware and
software. The Company’s sales and marketing efforts include collaboration with strategic partners and
distribution channel relationships to promote the sales of its products and services as well as its own
supporting sales and marketing teams.
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RIM’s primary revenue stream is its BlackBerry wireless platform, which includes sales of wireless devices,
software and service. The BlackBerry wireless platform provides users with a wireless extension of their
work and personal email accounts, including Microsoft® Outlook®, Lotus Notes®, Novell® GroupWise®, MSN®/
Hotmail, POP3/ISP email and others.
RIM generates revenues from sales, primarily to carriers, of BlackBerry wireless devices, which provide
users with the ability to send and receive wireless messages and data. RIM’s BlackBerry wireless
devices also incorporate a mobile phone, a personal information manager (PIM) including contact,
calendar, tasks and memo functionality, which can synchronize with the user’s desktop PIM system, and
web-browsing capability.
RIM generates revenues from service billings to its BlackBerry subscriber base primarily from a monthly
infrastructure access fee to a carrier/distributor where a carrier or other distributor bills the BlackBerry
subscriber. The BlackBerry subscriber base is the total of all subscriber accounts that have an active status
at the end of a reporting period. Each carrier instructs RIM to create subscriber accounts and determines
whether the subscriber account should have an active status. That carrier is charged a service fee for each
subscriber account each month regardless of the amount of data trafc the subscriber passes over the
BlackBerry architecture. If a carrier informs RIM to deactivate the subscriber account, then RIM no longer
includes that subscriber account in its BlackBerry subscriber account base and ceases billing from the date
of notication of deactivation. On a quarterly basis, RIM may make an estimate of pending deactivations
for certain carriers that do not use a fully-integrated provisioning system. It is, however, the carrier’s
responsibility to report changes to the subscriber account status on a timely basis to RIM. The number of
subscriber accounts is a non-nancial metric and is intended to highlight the change in RIM’s subscriber
base and should not be relied upon as an indicator of RIM’s nancial performance. The number of
subscriber accounts does not have any standardized meaning prescribed by U.S. GAAP and may not be
comparable to similar metrics presented by other companies.