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BlackBerry Priv sales begin, but will they be enough?

Matt Hamblen | Nov. 9, 2015
The slider phone may be one of BlackBerry's last, as company weighs being a phone maker

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The Priv may be BlackBerry's last shot as a smartphone maker.  Credit: Florence Ion

AT&T started selling BlackBerry's first Android-powered smartphone, a slider called the Priv, on Friday for $250 with a two-year contract, a price that could entice buyers who are reluctant to pay BlackBerry's own $699 off-contract price.

Pre-orders for the slider smartphone with a 5.4-in. display, started two weeks ago. A BlackBerry spokeswoman declared in an email that pre-orders for the Priv "far surpassed" pre-orders for BlackBerry's Classic and Passport phones, but she declined to offer any numbers.

BlackBerry Priv - Venice AT&T  
The Priv is a return to the slider-phone style. Credit: AT&T

While her statement sounds positive for Priv, it might not mean very much. Both earlier smartphones, which run on the BlackBerry OS, were "not tracking anywhere close" to what BlackBerry expected, according to Morgan Stanley analysts in March.

BlackBerry hasn't broken out sales figures for any of its devices, but the company recently said it generated revenues from shipping just 800,000 phones in the quarter that ended Aug. 29, down from 2.1 million a year earlier.

Its dwindling smartphone sales left BlackBerry with just 0.3% of the total global smartphone market in the second quarter, according to IDC. Presumably, selling an Android phone could help BlackBerry, because Android is now positioned at 83% of the global market.

Weighing Priv's pluses and minuses

BlackBerry, the pioneer of the smartphone, clearly faces trouble.

The biggest question is whether a security-enhanced Android Priv phone can lure enough buyers, bringing off a kind of Hail Mary pass for the company, even as BlackBerry positions itself to be more of a security software company than a smartphone maker. To that end, BlackBerry bought mobile device management company Good Technology in September for $425 million.

Some of the skepticism about Priv's ability to redeem BlackBerry showed up Friday in a variety of reviews.

For instance, after commenting that the Priv is "probably the best-looking BlackBerry device ever," Engadget reviewer Daniel Cooper declared, "BlackBerry is probably done as a phone manufacturer," owing mainly to the difficulty for any Android manufacturer to turn a significant profit.

BlackBerry CEO John Chen recently told a Code/Mobile conference audience that he would consider shutting the handset business in a year if it's not profitable.

He later said it would take sales of 5 million phones a year to reach profitability, a number that's much higher than the 800,000 sales of the second quarter.

The $699 Priv off-contract price won't be the only consideration for buyers. Some analysts said the security-enhanced slider Android smartphone could prompt BYOD (bring-your-own-device) workers to come on board (or stay on board) with BlackBerry. Its 5.4-in. touchscreen as well as a physical keyboard will also delight users familiar with the older BlackBerrys, even though the number of hard keyboard users is dwindling.

 

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