Make or break for Blackberry

30 January 2013

Gambling on survival, Research In Motion has launched its much-delayed new Blackberry 10 mobile phone.

The Canadian company once had a huge following among business customers, but has seen its market share collapse.

The latest handset has created a buzz in the technology world and among financial analysts, thanks to new features that may set it apart in the overcrowded smartphone market.

RIM’s shares have almost tripled in value over the past four months on bets that the devices will return it to the glory days and restore profits.

Nifty features

Reviewers like the browser speed and the intuitive keyboard on RIM’s new touchscreen. A feature called BlackBerry Balance, which keeps corporate and personal data separate, could help RIM rebuild its traditional business customer base.

It is a welcome start for RIM, the smartphone pioneer that has teetered on the brink of irrelevance.

But success will come only if consumer and business customers embrace the new technology which is available in a full touch-screen device and one with a traditional physical keyboard.

Right timing?

The timing may be just right. The new phone hits the market just as the iPhone’s remarkable run is showing some signs of slowing.

“I really do believe that the consumer market as a whole is ready for something new,” said Kevin Burden, head of mobility at Strategy Analytics, an industry consulting firm.

“I have to believe that there is some level of user fatigue that plays into the longevity of some of these platforms,” he added, referring to Google’s Android and Apple’s iOS, which are both more than five years old. “RIM is probably timing it right.”

Big gamble

It may take investors some time to determine whether RIM’s big gamble on an untested technology has paid off.

RIM’s market share collapsed in the three years ahead of the launch. Strategy Analytics data shows RIM’s global share of the smartphone market was about 3.4 percent in the fourth quarter, down from around 20 percent just three years ago.

While RIM has done well in developing markets, it has haemorrhaged customers in the United States, a market that sets technology trends. RIM’s fourth-quarter North American market share fell to two percent from more than 40 percent three years ago.

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