BlackBerry delivers, but the Z10 and Q10 face stiff competition

Two new well-regarded BlackBerry smartphones should help stem the tide of corporate user defections, but it may be too late to win over consumer iPhone and Android users.

The company formerly known as RIM delivered on its promise to breathe new life into its aging, iconic BlackBerry product line, but BlackBerry devices still face an uphill battle against Apple's iPhone and myriad smartphones based on Google's Android operating system.

At a New York launch event attended by hundreds of reporters and analysts late last month, CEO Thorsten Heins underscored the plan to reignite his company by first announcing that the vendor had changed its name from Research In Motion to BlackBerry.

The two long-awaited devices introduced at the event -- the first smartphones that the struggling Canadian company has unveiled in 18 months -- appear to be designed to appeal to two major audiences: consumers and corporate users.

The photo and video capabilities in the new BlackBerry Z10 and Q10 smartphones are likely to appeal to consumers. Enterprise IT managers, meanwhile, will likely welcome the embedded BlackBerry Balance technology, which can create two separate, secure spaces on the phones -- one to hold corporate data and the other for personal files, said Bob O'Donnell, an analyst at IDC.

Heins said the touchscreen Z10 and the Q10 handset with a physical keyboard were designed essentially from scratch around a new platform based on QNX, a real-time operating system RIM acquired in 2010.

While the BlackBerry was the undisputed leader of the smartphone market for years, the advent of the iPhone and then the rise of Android-based devices led many of its once-loyal users to defect.

The company now has about 80 million users, amounting to less than 5% of the worldwide smartphone market, and it faces an uphill battle when it comes to marketing and selling the Z10 and Q10, even though many analysts say the new devices are a good step forward from previous generations of BlackBerries.

"I think this is definitely a good start, and it will help slow those defections, but many [consumers] in the U.S., for example, have already left," noted Jan Dawson, an analyst at Ovum. "Most of the remaining BlackBerry users in the U.S. are on corporate-issued devices, so it's about convincing the IT department to continue with BlackBerry."

Outside of North American corporate IT operations, BlackBerry will run into trouble finding users, Dawson said. "The only big differentiators are productivity-centric, so [the Z10 and Q10 will] help with business users, but not so much with pure consumer users," he said.

"At best, RIM's new products will allow it to stop the bleeding and hold its market share," said Charles Golvin, an analyst at Forrester Research. "Our consumer data shows that while more than half of U.S. BlackBerry owners plan to get a new phone in the next year, fewer than two in five say it will be another BlackBerry."

BlackBerry said that U.S. sales of the Z10 will begin in March and the Q10 will be available in the U.S. by June. Carriers AT&T, Sprint, Verizon and T-Mobile will announce U.S. prices for the devices before shipments begin. In Canada, the Z10 started shipping on Feb. 5 at a price of $149.99 with a three-year contract.

Ferranti is a reporter for the IDG News Service. Martyn Williams of the IDG News Service contributed to this story.

This version of this story was originally published in Computerworld's print edition. It was adapted from two articles that appeared earlier on Computerworld.com: " BlackBerry Delivers, but Tough Battle Looms" and " New BlackBerry Phones Don't Wow Investors, but Analysts See Promise."

Read more about mobile/wireless in Computerworld's Mobile/Wireless Topic Center.

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Matt Hamblen, Marc Ferranti

Computerworld (US)
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