Blackberry 2009 Annual Report Download - page 18

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RESEARCH IN MOTION LIMITED
management’s discussion and analysis of financial
condition and results of operations continued
FOR THE THREE MONTHS AND FISCAL YEAR ENDED FEBRUARY 28, 2009
16
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, except as required by law.
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,
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 portfolio of award-
winning products, services and embedded technologies are
used by thousands of organizations around the world and
include the BlackBerry® wireless solution, and other software
and hardware. The Company’s sales and marketing efforts
include collaboration with strategic partners and distribution
channels to promote the sale of its products and services as
well as its own supporting sales and marketing teams.
Sources of Revenue
RIM’s primary revenue stream is generated by the BlackBerry
wireless solution, which includes sales of BlackBerry wireless
devices, software and service. The BlackBerry wireless
solution provides users with a wireless extension of their work
and personal email accounts, including Microsoft® Outlook®,
IBM® Lotus Notes®, Novell® GroupWise®, MSN®/Hotmail,
Yahoo! Mail®, POP3/ISP email and others.
RIM generates hardware 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. Certain BlackBerry devices also
include multimedia capabilities.
RIM generates service revenues from billings to its
BlackBerry subscriber account 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 account base is the total of all
• RIM’s reliance on its suppliers for functional components
and the risk that suppliers will not be able to supply
components on a timely basis or in sufficient quantities;
• the continued quality and reliability of RIM’s products and
services;
• risks associated with RIM’s expanding foreign operations;
• restrictions on import and use of RIM’s products in certain
countries due to encryption of the products and services;
• foreign exchange risks;
• effective management of growth and ongoing
development of RIM’s service and support operations;
• risks associated with acquisitions, investments and other
business initiatives;
• intense competition within RIM’s industry, including the
possibility that strategic transactions by RIM’s competitors
or carrier partners could weaken RIM’s competitive
position or that RIM may be required to reduce its prices to
compete effectively;
• dependence on key personnel and RIM’s ability to attract
and retain key personnel;
• reliance on third-party network infrastructure developers
and software platform vendors;
• changes in interest rates affecting RIM’s investment
portfolio and the creditworthiness of its investment
portfolio;
• government regulation of wireless spectrum and radio
frequencies;
• continued use and expansion of the Internet;
• regulation, certification and health risks, and risks relating
to the misuse of RIM’s products;
• tax liabilities, resulting from changes in tax laws or
otherwise, associated with RIM’s worldwide operations;
• difficulties in forecasting RIM’s quarterly financial results
and the growth of its subscriber base; and
• risks related to RIM’s historical stock option granting
practices.