Research In Motion Ltd. will start selling the BlackBerry Storm phone next month through Vodafone Group Plc and other carriers, introducing a touch-screen handset to compete with Apple Inc.'s latest iPhone.

The Storm will go on sale in Europe, India, Australia and New Zealand in November, Vodafone said in a statement today. Verizon Wireless, owned by Vodafone and Verizon Communications Inc., has exclusive rights to sell the phone in the U.S.

The Storm's touch-screen is the first to function like a regular keyboard, reacting to finger-taps, Research In Motion co- Chief Executive Officer James Balsillie said yesterday. The new features may help him overcome competition from the iPhone, bolstering Research In Motion's share of a device market that may more than double by next year.

``Touch screen is the hot segment and if you're not participating in that particular category, then you're certainly at a disadvantage,'' Avian Securities Inc. analyst Matthew Thornton said in an interview from Boston. ``This is going to be a big share gainer for RIM.''

Research In Motion, based in Waterloo, Ontario, rose $2.55, or 4.6 percent, to $57.60 at 4 p.m. New York time in Nasdaq Stock Market trading. Before today, the shares had dropped by almost half in the past month.

Last month, the phone maker said profit margins will shrink this quarter as marketing and development costs increase. The company also is introducing the BlackBerry Bold this month in the U.S., selling through AT&T Inc.

Storm's Features

The Storm has a 480 x 360 pixel resolution display, Web browsing, music and video downloads, satellite navigation, messaging and access to social networking sites. Balsillie, 47, aims to attract more consumers with those types of features. More than half of Research In Motion's subscribers are corporate.

``A very large percentage of our `biz' users add consumer services also for their personal use,'' he said in an interview. More than half the sales of the Pearl model, aimed at consumers, came from business clients, he said.

While the Storm can access the Web through Verizon's network in the U.S., it won't link to wireless computer networks, such as those in homes and coffee shops. The market for devices that can send e-mail and surf the Web, known as smartphones, may more than double to 288 million units in 2009 from last year, according to Stamford, Connecticut-based researcher Gartner Inc.

Apple gained a greater share of that market in the middle of the year with the iPhone 3G, introduced in July. The Cupertino, California-based company sold more than 1 million of the handsets in their first three days on sale. The company introduced the first version, combining a touch-screen phone with an iPod media player, in June 2007.

Cost Comparison

The Storm probably will cost about $199, matching the iPhone 3G, according to RBC Capital Markets analyst Mike Abramsky in Toronto. The phone is likely to come out in the U.S. the first week of November, he said in a report yesterday. Balsillie declined to comment, saying Verizon will announce availability ``soon.''

The iPhone 3G, designed to work on AT&T's network, was the best-selling smart phone in the U.S. from June to August, followed by the BlackBerry Curve and the BlackBerry Pearl, according to researcher NPD Group Inc. in Port Washington, New York.

Mountain View, California-based Google introduced a smartphone made by HTC Corp. in September, which goes on sale in the U.S. this month. The device, which has both a touch-screen and a slide-out keyboard, uses Google's Android system as its operating software.

Research In Motion held more than half of U.S. smartphone sales in the second quarter, according to researcher IDC in Framingham, Massachusetts. Palm Inc. held second place with 11 percent, while Apple took fifth place with 7.4 percent.

Corporate Success

Research In Motion probably will win users for the Storm because of its success with corporate customers, Thornton said. He advises investors to buy the shares and doesn't own them.

``RIM grew up with enterprise users,'' he said. ``It has kind grown out of that to be an aspirational brand, giving it cachet and significant brand power in the U.S. market.''

Source:Bloomberg