Steve Jobs, Apples chief executive and field general, has Napoleonic dreams of global conquest for his 10-month-old wonder gadget, the iPhone. So it may be fitting that he has encountering his most serious resistance in a city called Waterloo.

That is where, 110 kilometers, or 70 miles west of Toronto, 19 nondescript, low-rise office buildings constitute the headquarters of Research In Motion, maker of the BlackBerry.

RIM is the North American leader in building smartphones, those versatile handsets that operate more like computers than phones. But RIM may have trouble dominating the markets next phase. Once the exclusive domain of e-mail-obsessed professionals, smartphones are now prized by consumers who want easy access to the Web, digital music and video even more than an omnipresent connection to their in-boxes.

Since the iPhone went on sale last summer, amid long lines of shoppers and media adulation, the contours of the smartphone market have begun to shift rapidly toward consumers. An industry once characterized by brain-numbing acronyms and droning discussions about enterprise security is now defined by buzz around handset design, video games and mobile social networks.

That means RIM, which has historically viewed big corporations and wireless carriers as its bedrock customers, needs to alter its DNA in a hurry. While business is booming in Waterloo, analysts are raising an important question about RIMs future: Can a company that defined mobile e-mail for a generation of thumb-jockeys with bad posture also dominate the new consumer market for smartphones?

“The vultures are circling,” says Roger Kay, president of Endpoint Technologies Associates, a research firm in Wayland, Massachusetts. “There is this sense that the RIM franchise is under assault.”

In the short term, Apples noisy entrance into the smartphone market has elevated the visibility of smartphones and enhanced the prospects of most of its rivals. Worldwide, smartphone shipments jumped 60 percent in the last three months of 2007 over the same period the previous year, according to IDC, a research company. Of the two billion cellphones sold last year, nearly 125 million were smartphones - a share that analysts expect to inexorably grow.

RIM added 6.5 million subscribers in its last fiscal year, twice that of the previous year, and its stock hit the stratosphere, more than doubling in value as investors anticipated the coming Age of the Smartphone. And RIM has already introduced catchy mainstream gadgetry.

The BlackBerry Pearl and Curve, two phones aimed explicitly at the consumer market, have sold well, particularly during the holiday season, and account for a majority of RIMs device sales.

But there are also signs that RIM faces steeper challenges. At the end of last year, BlackBerry had a 40 percent share of the U.S. smartphone market, down from 45 percent at the end of 2006, thanks largely to the 17.4 percent share the iPhone grabbed in its first six months.

In March, Jobs announced that Apple would take the rare step of licensing Microsofts corporate e-mail technology, to allow iPhones to connect directly to business computers - a dagger aimed at the heart of RIMs strength in the corporate market.

Apple, in an effort to further increase its appeal to consumers, is also expected to introduce a new 3G version of the iPhone in June, which will work on speedier wireless networks and may further attract a new segment of customers to the iPhone in the United States and abroad.

In describing the threat that Apple poses to RIM, Charlie Wolf, an analyst at Needham, describes his wifes entirely common use of the iPhone, which she takes to bed with her each night to browse the Web.

“Some consumers who might have considered the BlackBerry, who dont have the e-mail urgency of a mobile professional, are going to start selecting the iPhone,” Wolf says. “This isnt going to stop RIM, but it is going to slow them down.”

Up in Waterloo, where the towering winter snowbanks finally melted this month, RIM executives appear nonplused. Though they would not reveal details, RIM itself is expected to unveil a 3G phone sometime in May and deliver it to wireless carriers throughout the year.

RIM employees and outside developers who are writing programs for the new phone, which has the internal code name “Meteor,” say that it will have faster processors, a larger screen and a better browser that more closely resembles the Web experience on a computer.

Photographs of the device, leaked to gadget news sites, also indicate that the new BlackBerry will have elegant curves suggestive of the iPhone. It will also have a physical keyboard like previous RIM devices, as opposed to the touch screen found on the iPhone.

PARIS: When Alicia Navarro began casting about for a memorable name for her new company, she confronted a brutal reality. All her brilliant ideas for an Internet domain name were taken.

“I came up with so many gems, only to be devastated to find that the domain name was not available,” Navarro, a former executive at Vodafone, said. “It means that Internet entrepreneurs are having to come up with ridiculous words to name their businesses Д Twango, Yugma, Stikkit, Rootly.”

Add Skimbit, the invented name of her London Web-applications company, to that list. Her Web woes Д like those of many others Д are tied to the sharp acceleration of speculation in Internet names, a practice known as “domain tasting” in which names are registered by the millions and tested for their advertising prospects without charge during a five-day grace period.

Arbitrators like the World Intellectual Property Organization and the National Arbitration Forum attribute the record number of international trademark disputes last year to domain tasting. Since this form of domain name tasting emerged in 2005, for example, the number of disputes to come before the WIPO has risen 48 percent, to 2,156.

For companies like Microsoft, domain tasting creates the constant headache of chasing after typo-squatters Д those who create and register Web sites with misspelled variations of the Microsoft name. For individual users, it means that millions of names are tied up in a constant churn of registering and returning names before fees are charged.

Now Icann Д the Internet Corporation for Assigned Names and Numbers, the organization based in California that manages domain names Д is considering steps to stamp out the practice.

The board of Icann will vote in Paris in June on a proposal to severely limit the number of domain names that can be returned without a fee, but the organization is facing resistance from domain name registrars, who are against ending the grace period.

These companies, which are licensed to register and sell new domain names, are themselves divided on the issue. Some argue that domain tasting is eroding consumer trust. Others insist that the grace period allows time to correct registrations that were spelled incorrectly.

A few registrar companies around the world account for about 95 percent of the system to register and dump names. A core reason for domain tasting, according to the Coalition for Domain Name Abuse, based in Washington, is that operators are looking for Web sites that bring in traffic Д and ultimately revenue Д from pay-per-click advertising links. Most often those names are similar to trademarked brand names.

“We call it a billion-dollar industry,” said Phil Lodico, an Internet strategy consultant and vice president with the coalition. “Initially squatters were just individuals who could be located anywhere by their personal computers. Theyre still out there, but there are also these companies that have invested heavily in technology. Theyre just canvassing the net by registering hundreds of thousands of domain names. And these folks are well-funded.”

Millions of names are registered and deleted after this five-day grace period, according to a subgroup of Icann, Generic Names Supporting Organization, which issued a report indicating that in March last year almost 80 percent of the 72.2 million names registered that month were “tasted” during the grace period and deleted. Most of this was dominated by 20 companies in the United States, Russia and Austria. The top three, Capitoldomains, Belgiumdomains and Domaindoormain, are registrar companies that each registered and dumped more than 11 million domain names in one month alone last year, according to Icann.

All three share the same address in Miami, with a contact number for a lawyer, Nancy Cliff, who did not respond to repeated messages. The Web sites for the three companies note though that they are fighting a lawsuit filed by personal computer giant, Dell, which is pressing “cybersquatting” lawsuits against the three.

That Dell dispute centers on the registration of domain names that are misspelling or types of prominent brand names, a technique known as “typosquatting,” and which are also tested as part of domain tasting.

Microsoft has also targeted “domainers” that have tested and used variations on its name, filing 20 lawsuits to recover 2,000 names and $2 million in damages in Britain and the United States, according to Aaron Kornblum, an attorney with Microsofts Internet safety enforcement group.

Icanns most dramatic recommendation is to eliminate the five-day grace period. But the group is weighing a more limited approach “because they believe it would be less controversial,” said Liz Gasster, an attorney for Icann.

Microsofts pursuit of Yahoo, if successful, will come with more than one bill due.

The shareholders, to be sure, will collect their payment, but Microsoft will mostly likely need to craft a package of financial incentives to prevent talented engineers and managers from hopping to other jobs in Silicon Valley.

The employee retention program could be expensive, perhaps costing billions of dollars, based on what Microsoft did when it acquired another technology company last year.

A look at that deal suggests how much people are the vital assets in companies that mainly generate ideas that become software and Web services. The hidden cost of “flight insurance” against employee defections may also be a reason Microsoft has resisted raising its bid.

Microsoft last May bought Tellme Networks, a maker of voice-recognition software used in directory assistance and for searching the Internet to retrieve consumer and local business information using a cellphone. Microsoft paid $800 million for the private company in Mountain View, California, but put in another $100 million for employee retention programs, according two people close to Microsoft. The $100 million for worker retention packages has not been reported before.

Cash payments, stock options and grants intended to hold onto employees after a takeover are fairly standard in Silcon Valley, say venture capitalists and industry analysts. These incentive plans, they add, can extend deep into the engineering ranks, unlike in most other industries where retention packages, or “golden handcuffs,” are typically offered to a handful of top executives.

For Tellme, which has 330 employees, the money set aside amount to more than $300,000 a worker. Yahoo is a much larger company, with more than 14,000 employees worldwide. And employee retention programs, if Microsoft acquires Yahoo, would likely be more tailored than for Tellme, analysts say. But even a program that is proportionately much smaller could add another sizable expense, perhaps a couple billion dollars, to the overall cost of bringing Yahoo into the Microsoft fold, analysts estimate.

“It would be a significant additional expense that would come due over several years,” said David Yoffie, a Harvard business school professor. “And Microsoft knew that when they made the bid for Yahoo.”

When buying companies in Silicon Valley, Microsoft in particular may have to offer attractive incentives to hold onto employees. Its reputation is still tainted by memories of its strong-arm tactics against companies like Netscape and Sun Microsystems in the 1990s, which prompted a long-running U.S. government antitrust case that it lost.

That reputation is probably dated, noted Mark Anderson, chief executive of the Strategic News Service, a technology newsletter. “But if youre in the valley, that first impression of Microsoft still has be overcome,” Anderson said. “So I think the company pays more in employee retention packages, a Microsoft premium.”

At Tellme, there was some reputational history to overcome. Michael McCue, a founder and the chief executive, was a vice president of technology at Netscape. He met regularly with Justice Department investigators when they were t assembling their antitrust case against Microsoft.

When the chief executive of Microsoft, Steven Ballmer, offered to buy Tellme, McCue asked if his company would be forced to switch its data center operating system, Suns Solaris, to Microsofts Windows.

“No, no, weve learned our lesson,” Ballmer replied, according to McCue.

McCue declined to discuss Microsofts employee retention program, other than to say it has been ample and effective. A few have left, including Robert Komin, Tellmes chief financial officer, who joined a solar energy start-up, Solexel. But 95 percent of the workers who were with Tellme when it became a subsidiary of Microsoft are still on board.

“Its been a great experience,” McCue said.