The BlackBerry, a phone and e-mail device that just a few years ago could be found mostly clipped to the belts of high-powered professionals, isn’t just for workaholics anymore.
Research in Motion on Friday is launching its first major counterattack at the iPhone: the BlackBerry Storm, a touch screen device that allows users to take pictures, play movies and music and visit their Facebook and MySpace pages with ease. It even tells them where to turn when they’re lost in their cars.
For years, Waterloo, Ontario-based RIM has been the de facto provider of e-mail devices for corporations. But the company has its sights on the consumer market.
It launched its first mainstream ad campaign on TV this year and is partnering with Verizon Wireless to expand a marketing blitz that has touted the Storm on TVs and in newspapers.
“It’s only in the last year that they’ve made a real concerted effort to branch into consumers,” said Barry Richards, a senior analyst at Paradigm Capital who owns shares in RIM.
RIM is trying to gain market share as tech-savvy consumers embrace smartphones, which are hand-held computers that allow them to make calls, surf the Web, check e-mail and maybe even watch TV. Smartphones account for 12.6 percent of handsets in use in the U.S. market but 19 percent of recently acquired phones, according to Nielsen Mobile.
“The smartphone market has plenty of room to grow, and we are well-positioned to benefit from our continued focus on innovation, customer value and partnerships,” said Mark Guibert, RIM’s vice president of corporate marketing.
Like other handset makers, RIM faces competition from Apple Inc.’s iPhone, whose sales have surprised analysts since its launch in June 2007. According to the NPD Group, the Apple gadget was the top-selling phone in the third-quarter, followed by Motorola’s Razr and the Blackberry Curve.
That’s not good news for carriers such as Verizon Wireless and Sprint Nextel Corp., which collectively lost 2 million subscribers in one quarter to AT&T, the exclusive provider of the iPhone, Paradigm’s Richards said.
Carriers are especially interested in signing up smartphone customers because although most people in the U.S. have voice plans, many fewer have data plans, which are more lucrative for carriers, said Jim Ricotta, CEO of Azuki Systems, a mobile media services company.
The Storm isn’t the first competitor to the iPhone, which is credited with piquing consumers’ interests in smartphones. T-Mobile’s G1, Samsung’s Instinct and LG’s Dare all have touch screen capabilities like the iPhone.
But RIM says it goes a step further, with what it calls the “world’s first ‘clickable’ touch screen” — the Storm’s screen compresses when tapped and offers tactile feedback to mimic the feeling of a real keyboard. And it captures video, which the iPhone doesn’t. It does include one popular iPhone feature: an accelerometer, which means the screen shifts depending on which way you hold it.
The Storm is “not an iPhone killer, but it is intended as a retention tool to keep people that have a BlackBerry but might be eyeing the iPhone,” said Charles Golvin, principal analyst at Forrester Research.
RIM is expected to gain some footing in the smartphone market because it offers phones with touch screens, flip screens and keyboards that appeal to a wide range of consumers. A Forrester survey found that 18 percent of 12- to 18-year-olds who frequently used the Internet on their phones wanted a BlackBerry — only 15 percent said they wanted an iPhone.
Still, few smartphones please consumers and critics like the iPhone, which is lauded for its speedy Web browser and its range of user-friendly applications. RIM will have an especially tough time competing in the fourth quarter because Apple gets so much holiday foot traffic in its stores, said Ross Rubin, director of industry analysis with the NPD Group.
“It’s going to tough to compete with Apple,” he said. “Then again, there could be pent-up demand.”
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