RIM’s BlackBerry 10 is launched today. Michell Maisto rounds up the analysts to pronounce on its prospects
Research In Motion (RIM), after rounds of promises and delays, will introduce the BlackBerry 10 mobile platform and new smartphones at a New York City event today (30 Jan uary). RIM has said that this modern platform will see it through the next decade, that its new handsets will be as compelling to consumers as to business users, and that the combination of the two will help it to regain some of its former glory.
The success of what RIM introduces will determine RIM’s fate.
The company’s falling market share — 20 percent in 2009, 16 percent in 2010, 10 percent in 2011 and nearly 5 percent in 2012, according to IDC — has in recent quarters prompted talk of a RIM acquisition. Executives have acknowledged that, with the help of third-party advisors, they’re considering all their options, which have been said to include a full buyout, the licensing of RIM software and the sale of RIM’s hardware division.
RIM CEO Thorsten Heins has made clear, however, that first RIM wants to launch BlackBerry 10 and see how the world responds.
Asking the analysts
This rather begs the question: What will a BlackBerry 10 success story look like? What will have to happen — what numbers hit, what shifts occur — for RIM and the majority of the industry to nod and agree: That worked out.
eWEEK asked seven analysts what they thought.
Neil Mawston, executive director, Strategy Analytics
RIM needs to wow in at least six main areas for BB10 to be considered a success this year.
- First, the new hardware designs must look attractive and sleek.
- Second, the new displays for high-end smartphones must be large, crisp and bright, with screen sizes of least 4 inches, ideally somewhere around 5.
- Third, the usability of the new BB10 software must be slick and bug-free. There should be no Apple Maps-like debacle.
- Fourth, RIM will need to demonstrate that its available services and apps for BB10 are growing fast, not just for business users, but also for consumers. RIM must not over-focus on the enterprise segment.
- Fifth, RIM must demonstrate that BB10 phones have at least basic multi-screen capabilities, able to link mobile hardware and services with the office, home living room and car.
- And sixth, RIM must have multiple tier-one operators on board worldwide and they must be actively subsidizing the new BB10 models.
The more of those six boxes RIM ticks, the more likely it is to succeed. First-generation BB10 models are unlikely to set the world on fire because stage one is just about catching up with rivals like Apple. But stage-two models in the second half of 2013 will need to be significantly more competitive, and that period is arguably more important for RIM than the immediate launch this week.
RIM needs operator support
Ken Hyers, senior analyst, Technology Business Research
If RIM can hit three major milestones — sign their biggest enterprise customers to the new platform; continue to engage developers and have at least 100,000 apps available at launch, and then steadily grow the portfolio of apps; and convince a large number of its current customers to upgrade the new platform — then its new platform will be considered a success, at least in the short term.
Longer term, RIM’s success must be measured by how well it does in attracting new customers. Most of the efforts we’ve seen to date have been to make the new platform appealing to existing BlackBerry users. This makes sense, because this is the low-hanging fruit. But RIM needs to show it can win back users that deserted RIM for iPhones and Android devices — and I think this will be a much harder task for it.
Avi Greengart, research director for consumer devices, Current Analysis
RIM is going to have to convince consumers—not just enterprises—to buy BlackBerry 10 devices instead of iPhones or Android phones. (The business and government base is important to RIM, but is actually only a fraction of RIM’s overall subscribers, and many enterprises are allowing employees to choose their own smartphones, so if you don’t attract the consumer, you’re going to lose the enterprise anyway.)
The new BlackBerrys will have to sell well enough to reverse RIM’s subscriber declines, and sales will need to grow even after the initial wave of true believers buys the first devices. If RIM gets that far, its next challenges will be broadening the line to allow its base of BBM-centric Curve users in emerging markets to upgrade, and carving out a unique space with application developers and service providers so that the BlackBerry 10 gets some of these apps and experiences first, not after iOS and Android.
RIM doesn’t have to beat Apple
Jack Gold, principal analyst, J. Gold Associates
I think a lot of people look at BlackBerry and think they won’t hit the numbers that Apple does, but it’s an unnecessary comparison: they don’t need to. Even if RIM can hit 10 or 15 percent of the market, that’s a lot of phones — they’d be doing quite well.
So one needs to look at whether their device numbers are increasing or decreasing over the next few quarters … and whether their service revenue will stay constant, if consumers are buying BlackBerry 10 devices but not attaching them to BES servers.
One of RIM’s significant problems has been one of perception. In the market today, if you’re not seen as a winner, you’re seen as a loser. There don’t seem to be many shades of grey. RIM needs to get some momentum behind them and get users to say, ‘I want one of those.’ That will determine how successful they will be over the longer term. They have to regain some market cachet.
Roger Kay, principal analyst, Endpoint Technologies
RIM essentially needs to show it can keep its core customers: financial and government agencies. Volumes are less important, although showing some good sales figures would be nice. RIM’s value proposition has always been secure, reliable corporate email [plus voice] for serious business types. It needs to prove it can still satisfy this important audience.
Jack Narcotta, analyst, Technology Business Research
If RIM can show cumulative revenue growth of five percent for all regions outside ‘other’ after BB10 launch, then I’ll consider it to be moving in the right direction. More than 50 percent of RIM’s revenue comes from ‘other’ regions [RIM’s label from its financial statements], which includes revenues from Middle East, Southeast Asia, Africa, Japan, China and Latin America. In these regions, RIM needs to quickly make even its premium devices affordable to the very fickle user base. In developed markets, such as Europe and the US, RIM will need to utilise aggressive pricing to rise above the glut of Android devices sold through carriers and undercut premium pricing for iPhone models.
If RIM can show between 3 percent and 5 percent growth in unit shipments after the BB10 launch, then that’s an indicator the company is righting its ship. The company shipped 32 million smartphones in 2012, roughly 8 million per quarter, and while a 3 to 5 percent bump in unit shipments wouldn’t vault RIM back into the top 5 — Android OEMs are simply making too many devices too quickly for RIM to leap over them — it would establish that BB10 is gaining traction and halting, to a degree, RIM’s year-long slide.
Carolina Milanesi, research vice president, Gartner
In the short term, the number of mobile operators that put their money where their mouths are, and really put their marketing money behind BlackBerry 10, will be telling. Where are these devices being positioned in their portfolio? Are they really considering it the third ecosystem? Are they really getting behind RIM and helping them?
After that, obviously, a big part of it will be sales volume. Can they sell to enterprises and to consumers? But first, we need to see if they can stop the bleeding.
What do you know about RIM and BlackBerry? Find out with our quiz!
Originally published on eWeek.