Research In Motion Ltd.’s rumoured media-streaming device is exactly the type of product that the beleaguered smart phone maker needs to avoid, according to some industry analysts.

A recent report from the BlackBerry-focused NerdBerry blog says RIM (NASDAQ:RIMM) will release a media hub, which is codenamed BlackBerry Cyclone, later this fall. The device will apparently allow users to stream content from with NetFlix and YouTube, connect to a TV via HDMI and support Wi-Fi.

In addition to fighting for market share against game consoles Microsoft Xbox 360 and Sony’s PlayStation 3, the BlackBerry media box would compete against similar offerings such as Apple TV, Google TV, Roku, Sony’s SMP-N100, and Slingbox.

Read more of our continuing coverage of Research In Motion

“If there was ever something I wouldn’t want to try and sell, it would be a TV set-top box,” said Rob Enderle, principal analyst with San Jose, Calif.-based Enderle Group. “Even Cisco, which saw this as being attractive, is now trying to find somebody to take Scientific Atlanta off their hands.”

The IT analyst said that if RIM goes through with the move, the strategy is being driven by its woeful position in the consumer market. He added that the device, if released, has little chance to be successful.

“It’s really like a veteran athlete having trouble as a tennis pro deciding to just take up golf instead,” Enderle said. He added that the company feels like it’s in “going out of business” mode, branching out into different markets and hoping an idea will stick.

The NerdBerry report, which cited an unnamed source within RIM, said the device resembles “a larger version of BlackBerry Presenter” — a RIM smart phone add-on that lets users present Microsoft PowerPoint or PDF documents from their handsets to a monitor or projector screen.

RIM spokespeople declined to comment on the rumoured device.

Charles Golvin, a principal analyst with Forrester Research Inc., was also puzzled by the rumoured device, but had a theory as to why RIM might be working on it.

“It’s probably been in development for some time,” he said. “It may have been conceived and developed during more flush times.”

Golvin said that while the desire would obviously be to stay competitive with Apple, the rumours come at a time when most financial observers and enterprise IT shops are more concerned with the company’s core smart phone and tablet business. He also pointed to the limitations of the market, warning that even something as successful as the digital video recorder (DVR) technology, he added, didn’t succeed until cable companies began integrating the capability into digital boxes.

Avi Greengart, a research director at Washington, D.C.-based Current Analysis, was cautious to pass judgment on a potential product that still doesn’t have a full feature set. But the industry watcher, who covers consumer devices, said he wouldn’t be entirely surprised if RIM released a product in the media streaming space.

“RIM is most definitely a platform vendor,” he said, adding that if RIM is competing with Apple on the phone frontier, it logically has to fight across the rest of the content ecosystem such as the tablet and digital home products.

He also pointed out that RIM is no longer an enterprise company, with most of its growth coming outside of North America to consumer space, including teenagers.
Greengart said that if RIM is simply looking to release a device that moves content from one media device to an HDTV or projector, the product has a chance to succeed.

“But I will say that if RIM thinks they’re going to displace the PlayStation, they’re insane,” he said.

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