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The BlackBerry smartphone better watch its back. A faster, cheaper - and maybe even smarter - phone is within weeks of hitting the market. Rival Apple Inc. has finally launched its long awaited next-generation iPhone, which will be compatible with 3G networks and priced from $199 (8 gigabyte model), half of the first generation’s current price. The new corporate-friendly version, due out July 11, will also provide a faster Internet connection and compatibility with Microsoft Outlook, the popular corporate e-mail system.

Calyon Securities analyst Charles Park said Apple’s aggressive pricing strategy should be viewed, in general, as “negative” for handset vendors like Research In Motion, maker of the BlackBerry, as he expects competition in the smartphone segment to increase. “Although Research In Motion remains the definitive leader in the business segment with the largest amount of U.S. market share and close competition with Windows Mobile worldwide, the Canadian company could experience a deceleration of its growth going onwards,” Park said in a client note.

At Deutsche Bank, analyst Chris Whitmore said the iPhone 3G, which features built-in GPS, faster speeds and enhanced battery life, could create a potential threat to Apple’s own iPod music player. “The lower price point will likely impact iPod unit sales, perhaps increasing cannibalization of the iPod touch, a trade-off Apple is more than willing to make due to the subsidies associated with the iPhone and dramatically expanded reach/global distribution.”

In addition to unveiling its next generation iPhone, the Cupertino, Calif.-based maker of computers and electronics announced on Monday changes in its iPhone business model. Specifically, Apple said it will no longer receive follow-on revenue generating payments from carriers for the iPhone 3G beyond the purchase of the phone by carriers or a commission on sales of the phone by Apple.

Goldman Sachs analyst David Bailey said that while there is a lack of clarity around the changes in Apple’s iPhone business model, once “the smoke clears” he expects the iPhone 3G to be more competitive. “[T]he changes in Apple’s iPhone business model will in some ways overshadow the 3G iPhone product announcement and will undoubtedly increase the volatility in the shares near term. That said, we expect the move from a revenue-sharing payment model to a subsidy model with the carries to be essentially revenue neutral to Apple, while the lower price points will drive incremental iPhone units.”

Several other analysts responded to the news by raising their iPhone sales estimates. Lehman Brothers analyst Ben Reitzes now expects fiscal 2008 iPhone unit sales of 23 million, up from his previous projection of 14.8 million. Merrill Lynch analyst Jeff Fidacaro lifted his iPhone unit estimates to 22 million from 20 million in fiscal 2009 and to 34 million from 30 million in fiscal 2010. At Citigroup, Richard Gardner boosted his calendar-year 2009 unit estimate to 23 million from 26 million and his calendar-year 2010 unit estimate to 28 million from 20 million.

Since the introduction of the iPhone, Apple Inc. has been the product to beat when it comes to meeting consumer connectivity needs with the latest and greatest smartphone. Research in Motion sought to change that Monday when it unveiled the latest version of its popular BlackBerry product, the Bold, in a move that revs up the battle for market share supremacy.

“Our take-away is that this is the first shot of the Research in Motion - Apple war that is starting,” JMP Securities analyst Sam Wilson said in a note to clients. “This summer, Apple will release its 3G iPhone and RIM will release Bold. These two companies are squaring off against one another.”

The Bold, which features an integrated global-positioning-system, Wi-Fi functionality, 128 megabytes of flash memory and 1 gigabyte of storage memory, is already receiving positive reviews from Wall Street analysts. In fact, Wilson even joked the latest smartphone from Research in Motion included “the kitchen sink,” and JPMorgan analyst Paul Coster called the device “very attractive.” Coster also lauded the screen resolution and brightness as setting the device apart from previous Blackberrys, while saying the new “Precision” user interface is easy to use and that the Bold is very fast.

Elsewhere, Citigroup reiterated a buy rating and $140 price target on Research in Motion shares, as the broker estimated the new product could increase the company’s quarterly shipments by 200,000 to 400,000 units.

Canaccord Adams also liked the product, saying: “With the (BlackBerry) 8700 approaching two years of service, we believe the BlackBerry Bold has the opportunity to become a blockbuster. We are hearing that pre-orders from AT&T and Vodafone could materially exceed expectations, which will likely drive upwards earnings revisions in the back half of the year.”

Still, some caution investors not to forget about Apple quite yet, as the computer giant may be biding its time until the much-anticipated launch of its 3G iPhone. After checking 11 U.S. retail stores and finding that only 6 had iPhones in stock, Piper Jaffray said the limited availability of iPhones indicates that the release of a 3G model is “imminent,” and that it expects an announcement in mid-June.

So much for worries about consumers.

Well more than 2 million net new BlackBerry subscriber accounts were added in the three months ended March 1, according to Canada-based Research In Motion. At the end of the last quarter, the company said its total BlackBerry subscriber account base was over 14 million.

Shares in the BlackBerry maker climbed to a four-month high Thursday as analysts cheered the company’s robust growth and upbeat guidance. After Wednesday’s closing bell, Research In Motion posted fourth quarter earnings of 72 cents a share and revenue of $1.88 billion. Analysts polled by Thomson Financial, on average, expected a profit of 70 cents per share on sales of $1.86 billion. The company also said it expects earnings of between 82 cents and 86 cents per share, above the Street consensus estimate of 76 cents. “The prospects for RIM and the industry are more exciting than ever,” Co-CEO Jim Balsillie said.

Goldman Sachs analyst Thomas Lee applauded RIM’s strong profit outlook Thursday, saying it is “a bright spot in this tough macro environment and is a testament to the level of importance consumers/enterprises place on the BlackBerry offering.” Lee said while the company certainly recognizes the possibility of facing potential macro headwinds, its guidance suggests that its business is “much more resilient” than other areas of IT spending, such as enterprise software and networking. The replacement and upgrade market also remains robust, Lee said, as RIM indicated that a number of 8700 subscribers are rolling off two-year contracts, which should help extend the strong momentum in the replacement market.

“BlackBerry is still in early stages and we see a number of drivers that make the story compelling, such as new products and increased stickiness within both the consumer and enterprise segments with offerings such as BB Unite, Facebook apps, and others,” Lee said.

Also worth noting is RIM’s rapid growth into the consumer segment, said JPMorgan analyst Paul Coster. RIM said in a conference call that about 38% of the BlackBerry subscriber base were non-enterprise at the end of the year, and well over half of the net new subscriber account additions in the fourth quarter came from non-enterprise customers. “The long-term secular growth story trumps our concerns regarding near-term consumer spending and seasonality - no hiatus at all,” Coster said in a research note Thursday.

Nothing can stop Research In Motion’s momentum, analysts say, not even the iPhone. In fact, contrary to some investor concerns, iPhone appears to have “helped, not hurt, RIM on strong domestic carrier promotions and retail activity,” said RBC Capital Market analyst Mike Abramsky.

Oppenheimer analyst Ittai Kidron believes BlackBerrys are “living in peace” with Apple’s iPhone. “A 3G iPhone is on its way and will compete for attention,” Kidron wrote to clients. “However, we believe iPhones and BlackBerrys can coexist in the marketplace as smartphone penetration rises and as both are fundamentally different and cater to a different user/price point.”

When Research In Motion logged into BlackBerry Smartphone’s Facebook account on Tuesday, the Waterloo, Ontario-based designer of wireless products for the mobile communications market was met with more than 1 million friend requests.

“When we launched Facebook for BlackBerry Smartphones, we believed that consumers would recognize the value of marrying social networking with mobility and that vision has now been validated more than a million times,” said Mark Guibert, vice president of corporate marketing at Research In Motion.

The company launched its mobile software application at the Cellular Telecommunications & Internet Association’s Wireless IT and Entertainment 2007 show on Oct. 24, 2007, leveraging the push-based BlackBerry service and the Facebook platform to offer a new mobile experience for Facebook users. The application allows users to send and view messages, photos, and wall posts on Facebook while automatically receiving notifications on their BlackBerry as friends and colleagues respond with messages and photos of their own.

“This innovative mobile application … makes it easier than ever for Facebook users to stay connected with people wherever they choose,” Guibert added.

UBS maintained its buy rating and $155 price target on the stock of Research In Motion, saying it expects a third-generation (3G) technology BlackBerry, with a higher average selling price, to support growth into November.

“We believe demand remains robust (as evidenced by strong net subscriber additions) and strong initial orders for the CDMA Curve point toward a push by Verizon Wireless (and likely other carriers soon after),” UBS said. “With a higher average selling price, the CDMA Curve, combined with continued demand and international ramp, should help drive May-quarter revenue above current Wall Street consensus.”

The firm also said demand for smartphones is growing rapidly, and although Research In Motion faces higher competition, the potential market size is big enough to benefit multiple players.