Subscribe / Unsubscribe Enewsletters | Login | Register

Pencil Banner

BlackBerry enters the last chance saloon

Peter Burrows and Madeline McMahon (via Bloomberg/ SMH) | July 5, 2013
BlackBerry's chances of becoming a viable contender to Apple and Google in the smartphone market are dimming amid lackluster demand for its flagship touch-screen device.

Facing dwindling interest .. Research in Motion CEO Thorsten Heins.
Facing dwindling interest .. Research in Motion CEO Thorsten Heins.Photo: AP

BlackBerry's chances of becoming a viable contender to Apple and Google in the smartphone market are dimming amid lackluster demand for its flagship touch-screen device.

Corporate information-technology departments have long wanted a third alternative to Apple's iPhones and devices based on Google's Android operating system, to ensure innovation and price competition. Yet many businesses are dropping support for BlackBerry as employees flock to touch-screen devices from Apple, Samsung Electronics and others, according to makers of software used by companies to manage smartphones at work.

That trend was underscored last week when BlackBerry missed analysts' estimates for phone shipments and profit. Now the Waterloo, Ontario-based company could see further declines as businesses grow more sceptical of its brand, said Bob Tinker, chief executive officer of MobileIron, which makes smartphone-management software used by 5000 companies. That makes Microsoft's Windows Phone a likelier third option.

"Most of our customers have been planning to support three mobile operating systems - iOS, Android and either Windows Phone or BlackBerry," Tinker said. "The recent results indicate that BlackBerry is not going to be the third."

BlackBerry last week disclosed unexpectedly weak sales of its flagship Z10 handset, which was designed to exploit its new BB10 software to take on high-end phones such as the iPhone and Samsung's Galaxy S4.

The disappointing results give a shot in the arm to Microsoft, which has gained ground on BlackBerry in recent years in the struggle for third place. In the global smartphone market, BlackBerry's share shrank to 2.9 per cent last quarter from 6.4 per cent a year earlier, according to research firm IDC. Apple and Android together held 92 per cent of the market. Microsoft's Windows Phone bumped BlackBerry into fourth place.

BlackBerry's worldwide subscriber base slipped to 72 million last quarter, from 76 million and 79 million in the preceding quarters, and the company last week said it will no longer disclose a user tally.

With limited employee demand for BlackBerry devices, some companies are deciding to turn off the BlackBerry Enterprise Server, which is the back-office software that lets BlackBerry users securely get email and synchronise appointments in the corporate network, rather than upgrade to the new version for the BB10 operating system, said Tinker. That saves monthly charges and lowers IT costs. Without BES, BlackBerry devices lack most of the features that made them so popular with IT departments and many users.

"We have seen a very enthusiastic response to BES10 from our customer base," said Pete Devenyi, senior vice president of enterprise software for BlackBerry, who said 18,000 companies have downloaded or deployed the software since it was released in January. A BES10 server can manage 15,000 BlackBerry phones, versus about 2000 for the previous generation. "The adoption of BB10 has been very much in accordance with our expectations," he said.

 

1  2  3  Next Page 

Sign up for CIO Asia eNewsletters.