(MoneyWatch) -- The girl is on fire, so investors threw her a bucket of cold water.
Amid great corporate pageantry, Research in Motion, the struggling maker of BlackBerry mobile phones, held a much-anticipated unveiling of its new phones Wednesday, in the process changing its corporate name (to BlackBerry) and naming New York diva Alicia Keys the company’s creative director.
Investors appeared unimpressed on all counts, sending shares of Research in Motion (RIMM) plunging more than 7 percent by midday. And the selloff came amid exceptionally heavy volume: By noon, more than 140 million shares had traded hands, compared to a daily average of about 50 million. The company’s shares have more than doubled in the last four months as people placed bets that CEO Thorsten Heins and the new products would right the ailing company.
For a stock that had soared in recent months, such a reaction may have been a bit of “sell on the news.” Tech writers immediately hit the blogosphere with reviews of the Z10, a touchscreen model, that while not breathless were not entirely negative either. Still, there didn’t seem to be anything in the reviews suggesting that the new products will be so alluring that they’ll convince users of Androids or iPhones to jump ship and join the BlackBerry family.
And that may be enough to convince skittish investors that it’s time to take a breather on shares of RIMM, as the broader stock market has steadily been pushing up near all time highs.
“With smartphones soon to reach their maximum penetration, time is running out for RIM and other Apple/Samsung/Google competitors to stake a claim in the smartphone business,” said Wayne Lam, senior analyst for wireless communications at research firm IHS.
Amid the push for new product designs, Heins has vastly trimmed and reorganized the company’s workforce. Some analysts have predicted that if the new phones don’t catch on, the company will have to be sold.