 |
BlackBerry loses sales lead to Apple in Canada
 |
Insight
You always want the home team to win. But when it comes to smartphones, Canadians are increasingly kicking their CrackBerry addiction and buying iPhones, instead. That spells another piece of troubling news for Research In Motion.
According to sales data from IDC and Bloomberg, RIM, long the leader in Canadian smartphone sales, lost its crown last year to Apple. The Waterloo-based company shipped 2.08 million BlackBerry devices here, well short of the 2.85 million iPhones from Apple. The 2011 performance continues a downward trend for the troubled vendor, which sold almost five times as many phones as Apple did in 2008. By 2010, its lead had shrunk to 500,000 units.
RIM focuses on emerging markets
Statistically, none of this will materially affect RIM's near-term performance. Canada, which accounts for 7 per cent of RIM's global revenue, is hardly the company's largest market.
RIM has been shifting its efforts in recent years toward emerging markets like India, China, Africa and Latin America, claiming that they, more than any other, are the key to future growth. But that growth is being tempered by a 23 per cent drop in Canadian revenue in the company's fiscal third quarter compared to the year-ago period, and an even more ominous 45 per cent sales hit in the U.S. in the same quarter.
Data from comScore covering November 2011 through January 2012 showed only 6.6 per cent of new U.S. mobile subscribers signed on with BlackBerrys. RIM's market share there was down two points to 15.2 per cent from the previous quarter.
While losing the sales lead in its Canadian home market won't mathematically make or break RIM's global financial performance, what's happening here signals a broader flattening that threatens to drag down any gains in foreign markets. Beyond the recent performance figures lies the psychological hit, and the fact that it's yet another dark cloud in a sky that's been filling with them over the past year. The perception is almost as damaging as anything else: If the company can't prevail in its home market, where can it? And what does this say about its prospects elsewhere?
Analysts are already weighing in, with Canaccord Genuity analyst T. Michael Walkley warning earlier this month that sales of BlackBerry 7-powered smartphones - introduced last August and September — were continuing to soften despite RIM's efforts to bolster demand with deeper carrier subsidies and a major uptick in its Be Bold marketing campaign.
His comments came just after Jeffries analyst Peter Misek said there was a better than even chance RIM would miss guidance — and might announce its results before the originally scheduled date of March 29th to face deepening market worry head-on. He trimmed his share value target to $12 U.S., down from $15, largely because the company won't have new products in the pipeline until BlackBerry 10-powered devices bow later this year.
RIM to be squeezed out as corporate darling?
It all adds up to a tenuous time for RIM as it tries to squeeze demand out of its older platform while waiting for the new one to be ready. Traditional corporate support — long the BlackBerry's strong suit — is ebbing, as well, as the BYOD — bring your own device — trend gathers steam. While IT departments, long RIM's most ardent supporters, once rigidly controlled which devices were connected to corporate technology infrastructure, that monolithic approach is breaking down as consumers increasingly buy their own technology and then demand that IT hook them up. As consumers increasingly drive corporate technology decision making, RIM finds itself on the outside looking in.
The trend is evident in a series of high-profile defections in recent months, including the U.S. National Oceanic and Atmospheric Administration, the Bureau of Alcohol, Tobacco and Firearms and Explosives, and Halliburton Co. All have announced plans to wean current employees off of their BlackBerrys and replace them with either iOS or Android-powered devices.
With RIM's enterprise base of support under threat, the company reached out earlier this month to quell concerns it was losing its corporate edge. It released a statement reaffirming the platform's security advantages and launched BlackBerry Mobile Fusion, a software product that provides centralized control of BlackBerrys and PlayBooks, iOS devices like the iPhone, and Android. It recently released the PlayBook OS 2.0 update to generally positive reviews, thanks largely to its slicker performance and support for Android apps. As CEO Thorsten Heins settles into his first few months on the job, these moves are proving he's keenly aware of the challenges facing RIM.
But they may not be enough. As analysts and observers prepare themselves for the next dose of expected soft financial news next week, the market is counting the days until the new BlackBerry 10 devices launch — and asking itself how many more blows will land in the interim. If sinking domestic sales figures are any indication, there will be fewer smarthphone users in Canada still paying attention by the time RIM's bet-the-company new platform hits the market.
704 page views
|
|
|
|