RIM Up, Palm Down in Tech Yin-Yang

Sam Gustin writes: BlackBerry maker Research in Motion offered a better-than-expected holiday earnings forecast, boosting the company's shares in after-hours trading, while rival Palm reported a whopping $506.2 million loss as revenue plummeted 45 percent, sending its already-battered stock price down as much as 10 percent in late trading.

Taken together, RIM's upbeat forecast and Palm's downcast news highlight the diverging fortunes of the two smart-phone makers, both of which are competing under the shadow of Apple's wildly popular iPhone and a recession-fueled slowdown in consumer spending.

RIM said it added 2.6 million BlackBerry users, a 14 percent increase in the third quarter. In particular, the company said its new Bold and Storm handset offerings are selling better than expected.

"RIM launched an unprecedented number of BlackBerry smartphones in the third quarter and these new products are being adopted at an even faster pace than we expected," RIM chief executive Jim Balsillie said in a statement.

Palm, by contrast, said it sold 13 percent fewer smart-phones during the quarter. "We're working through an undeniably difficult period," Palm chief executive Ed Colligan said in the statement.

Palm has been in dire straits for some time -- this is its sixth consecutive quarterly loss. The company is hoping to find some redemption next month when it is set to unveil its new "Nova" mobile operating system, as well as new devices the software will run on.

But will it be enough? Apple has been gobbling up market-share in the smart-phone space. BlackBerry continues to release popular products, and is moving aggressively outside its traditional business customer base.

With consumers tightening spending amid a recession, there is only so much of the smart-phone market pie to go around. Unless it can dramatically reverse its fortunes, Palm may soon find itself as the odd man out.