BlackBerry 10 Seen Facing Long Odds Winning Back Customers
As Research in Motion changes its corporate name to BlackBerry and rolls out a new operating system and hardware, the smartphone supplier will have its work cut out in seeking to win back customers and secure new ones amid heightened competition from Android and iPhone platforms, retailers we polled said.
Sign up for a free preview to unlock the rest of this article
Timely, relevant coverage of court proceedings and agency rulings involving tariffs, classification, valuation, origin and antidumping and countervailing duties. Each day, Trade Law Daily subscribers receive a daily headline email, in-depth PDF edition and access to all relevant documents via our trade law source document library and website.
While retailers that carried BlackBerry smartphones said sales were “very slow” amid the multiple introduction delays suffered by the BlackBerry 10 operating system, most were willing to give it a chance. “I am going to carry it and you don’t have to win me back,” said Mark Shaw, CE merchandising director at Nebraska Furniture Mart, which also sells Android-based smartphones and iPhones. “I will support it and the sales staff will be trained, but ultimately the customer votes. They will have to win back customers that converted off, which is always a challenge because they made a decision to switch and then the new customers are going to have to find something compelling."
The BlackBerry Z10, which features a touch-screen keyboard, will hit the U.K. today, Canada on Feb. 5 and the United Arab Emirates on Feb. 10, the company said. In the U.S., it will launch with AT&T and Verizon in March, priced around $200 on a three-year contract. The Z10 has a 4.2-inch LCD with 1,280 x 768 resolution, a step up from earlier BlackBerrys with 3.2-inch and 2.8-inch displays. The new model also moves to a 1.5 GHz processor, vs. the 1 GHz chip in earlier versions, has 2 GB RAM and 16 GB of internal storage. It also adds LTE and near field communication (NFC) technology and has an eight-megapixel digital camera capable of 1080p recording.
At the heart of the new operating system is BlackBerry World, home to 70,000 apps, including Amazon, Skype and others, but minus Netflix and Hulu. BlackBerry 10, which was designed based on QNX software RIM acquired from Harman International, also offers for the first time music, movies and TV-episode downloads. RIM previously offered only games and apps through its online store. The video will be available for sale and rent from 20th Century Fox, Lionsgate, MGM, National Film Board of Canada, Paramount Pictures, Sony Pictures Home Entertainment, Starz Digital Entertainment, Walt Disney Entertainment and others. TV shows will be available from ABC, CBS, NBCUniversal and others.
BlackBerry Messenger adds video calling that allows the user to share an entire screen with the person who the user is video chatting with. And BlackBerry Balance separates work and personal accounts, allowing the user to swipe down to toggle between the two profiles. The work account can be controlled by a company’s IT department, which can push updates and apps to it without affecting personal data. There’s also BlackBerry Flow, which resizes content, and a Hub feature that, with a swipe, reveals everything that has been done recently or new messages. BlackBerry Remember enables the user to save emails, Web pages and documents with notes and due dates, while BlackBerry Story Maker allows for editing together of photos and video and setting them to music.
"With it’s highly integrated enterprise features, BlackBerry could win back the hearts of business users, particularly in Europe and North America,” said Malik Saadi, principal analyst at Informa Telecoms & Media. In emerging markets, it’s “highly unlikely” BlackBerry users will be able to afford the new model, given its price, he said. Instead, BlackBerry will try to win “new premium subscribers” in emerging markets, a segment dominated by Apple and Samsung, Saadi said.
While businesses may be attracted to the new platform, BlackBerry will be faced with U.S. customers that hold on to their smartphones for longer periods and no longer trade up every year, said Michael Perlman, president of BrandsMart, which sells BlackBerrys. BlackBerry 10 may not “make much difference at retail because while cellphones are still doing well globally, they are slowing down,” Perlman said. “Phones are reaching a point where there is nothing new to make you buy a new phone every year. I think people are going to keep these smartphones for two or three years."
The re-launching of the brand as BlackBerry also will require a multi-month marketing campaign to raise its profile with consumers, Shaw said. BlackBerry will air a 30-second commercial during the NFL’s Super Bowl on Sunday and have real-time engagement with BlackBerry fans on Facebook and Twitter during the game. BlackBerry has 30 million social media fans, BlackBerry said.