Is BlackBerry ripe for a comeback?

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BlackBerry is seemingly back from the dead with some ‘jaw-dropping’ Q4 results on the back of its first BB10 device launches. It is now aiming to supplant Samsung in the UK smartphone market, as Paul Withers hears

With Samsung and Apple occupying the top two spots in the smartphone sector, the immediate target of the chasing pack has been to achieve a podium finish.

BlackBerry is one of the manufacturers aiming to claim a top three finish, but such is its new-found confidence – something distinctively lacking in 2012 with its rather muted approach to the press – the company believes it can eventually challenge Apple and Samsung in the smartphone space.

It is an ambitious statement to make – some would argue unrealistic – but the market is liable to change. BlackBerry certainly has plenty of reasons to be cheerful so far in 2013.

The manufacturer unveiled its new BlackBerry 10 (BB10) platform on January 30, after its release was delayed twice last year, and the following day the Z10 went on sale in the UK.

On March 28, BlackBerry posted its Q4 financial results for the three months to March 2 revealing it had sold one million Z10s, despite it only going on sale in the UK, Canada, Singapore and Malaysia.

The results also revealed that despite losing three million subscribers in the quarter – reducing its base to around 76 million users – profits were up more than 570 per cent to $94 million (£60 million), signifying a firm return to profitability.

The Q10 has followed as the manufacturer’s second BB10 handset and the first to feature both a touchscreen and a QWERTY keypad.

It went on sale in Carphone concessions in Selfridges department stores on April 26, exclusively for that weekend.

On April 29, Selfridges said the Q10 was its fastest-selling consumer technology product ever, with initial stock selling out in two hours. Later that day, Carphone Warehouse said it was ordering more Q10 stock for the high demand anticipated for the nationwide roll-out later that week.

BlackBerry president and CEO Thorsten Heins continued the charm offensive the following day when, in an interview with Bloomberg Television, he said that based on the early success of the Q10 in the UK, he expected sales to be in the “tens of millions.”

Sitting down with BlackBerry UK and Ireland managing director Rob Orr (pictured right) and executive vice president of global sales and regional marketing Rick Costanzo (pictured left) in successive weeks, both were clearly delighted with the start that BlackBerry 10 had got off to.

Consolidation
Orr’s main objective is for BlackBerry to maintain its position as the third biggest smartphone manufacturer in the UK behind Apple and Samsung. According to figures from GfK for Q1, the manufacturer had a 10 per cent share of the market.

He says: “The Z10 is about solidifying third spot, and the Q10 gives us a very unique set of capabilities for us to further maintain that. We’ll continue to grow from there. There is huge pent-up demand for the Q10 and I think we will see a few weeks of very good sell-through.

“When BlackBerry customers who have been waiting for the physical keyboard come into a store, they can also see the full touchscreen experience and virtual keyboard on the Z10. They then have the choice of whether to go for the QWERTY device that they have been waiting for, or to try BlackBerry on a full touchscreen.”

Costanzo agrees that securing third spot in the UK is a priority this year, but says that this should only be viewed as a short-term aim for the company. He is confident BlackBerry has the ability to not only cement its position, but to then challenge Apple for second spot, and even Samsung for the top position in the UK smartphone market.

“Rob is right in terms of a short-term goal for us,” he says. “Am I happy with number three? Not a chance. I recognise that for us to aspire to something greater, we have to hit number three first, then target number two, and then target number one.”

Confidence
Costanzo adds: “Make no mistake about it, we have higher aspirations. It’s just this is a journey we must take one step at a time. That’s why you don’t hang your hat on one product – you hang your hat on one platform with additional incremental momentum. That’s very clear in what we are doing with Z10 and Q10.

“I’m confident we have all the necessary tools. We will continue to build that credibility, excitement and momentum, get our heads down and do the job that we need to do. You don’t play a game just to stand on the sidelines, you play the game to win and that’s what we’re trying to do. It’s a horrible analogy to use, but we’re not messing about.”

Full article in Mobile News issue 538 (May 6, 2013).

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