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Will the Q10 save BlackBerry?

- April 12th, 2013
BlackBerry 10

The BlackBerry Z10 and Q10. (AUDE BOIVIN FILION/QMI Agency)

Perhaps asking if the Q10 will save BlackBerry is a cruel question. Certainly, with the launch of the Z10, back in January, the company formerly known as Research in Motion  had shown it was able to release a smartphone that could compete in the current marketplace.

With its sleek design, updated hardware and OS, the Z10 looked like a contender, even if it launched with a significantly lower number of apps available than available from the Apple App and Google Play stores. The product flew off the shelves quickly, leaving many without the opportunity to buy the phone, though some argued that had more to do with the low inventory the wireless providers were given, as opposed to an actual sellout of the device.

Certainly, the Z10 launch seemed to indicate a turnaround for BlackBerry. On March 28, when the company announced a surprise Q4 profit of $98 million under newly minted CEO Thorsten Heins, it said 1 million Z10 phones have already shipped and the company expected to break even for Q1 of this year.

But that success appears to be short-lived. BlackBerry shares slipped 8% on Thursday after doubts emerged about its turnaround. (The stock had lost a quarter of its value since January.) As one trader points out in the Reuters  article, the fact BlackBerry has already discounted the Z10, is not a promising sign.

However, of greater concern, are two separate reports, cited in a Wall Street Journal article,  that both suggest weak sales for the phone South of the border. ITG analyst Joe Fersedi wrote that the Z10 launch  “started poorly and weakened significantly as the days passed.” He said that U.S. sales were in line to be only slightly ahead of the “anemic sales” older BlackBerrys and the Nokia Lumia 822.

The second report from Detwiler Fenton says that returns actually exceed sales. Analyst Jeff Johnston writes in the report:

“We believe key retail partners have seen a significant increase in Z10 returns to the point where, in several cases, returns are now exceeding sales, a phenomenon we have never seen before.”

BlackBerry has fired back against this second report, calling it “false and misleading.” The company said its return rates were at or below what was expected and is in line with industry norms. It also said it would ask securities regulators in Canada and the U.S. to probe the report. So whether it’s true or not, BlackBerry is in damage control.

It doesn’t help that a smartphone survey that placed BlackBerrys at the top of a “don’t want” list. As is reported in the All Things D article, U.S. research house Raymond James polled 250 consumers  about their smartphone purchasing intent. In the survey, 71.4% of respondents said they would never purchase a BlackBerry, compared with 31.3% who said they’d never buy an Android phone and 19.7% who’d never buy an iPhone. Admittedly, 250 is quite a small sample, but it certainly doesn’t help the company’s image

Neither does another smartphone survey that indicated most Americans didn’t even know a new BlackBerry was available, Barron’s reported. The MKM Partners survey asked 1,500 U.S. consumers about smartphones and their purchasing intentions. Among the findings, was that 82.6% of respondents didn’t realize that the new BB10 phone had launched in Canada and Europe in late January – and 87% didn’t think it would become available in the U.S. in the next 30 days. (The survey was conducted between March 7 and April 2. The Z10 launched in the U.S. on March 22.)

Ultimately, the fate of BlackBerry rests  with the Q10. Personally, I think it was a mistake for the company to not launch it at the same time as the Z10. I get that the company wants to keep interest throughout the year with multiple launches.

But when most people think of a BlackBerry, they think of a phone with a physical keyboard. That’s the main reason BlackBerry diehards have been holding onto to their Curves and Pearls as they primarily use them for business emails and texting. (Sure, there was the keyboardless BlackBerry Storm for consumer use. But do you know of anyone who actually got one and didn’t complain about it afterwards?)

The Q10 is coming to Canada on April 30, it is already available for preorder from Rogers, Bell, Telus, Fido, Future Shop, Best Buy and SaskTel. It will also be available at Koodo Mobile in the near future.

Of course, BlackBerry hasn’t released any pre-sale figures for the Q10, but its success or failure will serve as an indicator as to whether there is still a big enough appetite for a smartphone with a physical QWERTY keyboard. Or whether the concept is just out of fashion.

And if the latter’s the case, then BlackBerry is in trouble…

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12 comments

  1. David | April 12, 2013 at 6:39 pm

    Terrible article, completely negatively portraying the BlackBerry and nothing positive. Should be ashamed to post this crap!

  2. john | April 12, 2013 at 7:21 pm

    Blackberry isn’t given a break. The Z10 is pretty cool and the next one coming is no slouch either. Apple is yesterday and HTC (the best phone by far), SONY, SAMSUNG and NOKIA are your new prize fighters. APLLE best be sticking to developing a new macbook if it wants to survive. Even with that much cash you are still only as good as your last offering and the iphone 5 should never have made it to market.

  3. john | April 12, 2013 at 7:23 pm

    The weak sales were due to the poor marketing from the carriers, not Blackberry.

  4. Len King | April 12, 2013 at 8:22 pm

    Terible article,this is why I hardly even look at the garbage news your company puts out,report the truth or don’t report at all,ever heard of research or are you’s all to stupid to do that,

  5. yossef | April 12, 2013 at 11:21 pm

    Ridiculous analysis

  6. Paul | April 13, 2013 at 5:47 am

    The author obviously is over-leveraged with Apple stock, and is doing whatever he can to sink Blackberry. I don’t expect much from Canoe/Sun, but this is reaching a new low.

  7. Greg Gazin | April 13, 2013 at 11:13 am

    Regardless of the accuracy of the report on return rates, or the industry norm, as a company, I’d want to know why the products were being returned. Was it a problem with the product, the experience, or was it simply folks who might have locked in other contracts and wanted to “test drive” the product?

  8. Doug | April 13, 2013 at 11:15 am

    I’ve used a Torch for 2 1/2 years and love it. I will definitely be upgrading to the Q10 as soon as possible. Don’t anyone using a Torch not planning to do the same.

  9. Crystal Minard | April 13, 2013 at 3:45 pm

    Will Canoe survive??? I don’t think so.. not if they keep up this type of reporting. Get with it Canoe!

    Maybe Adam should do more due diligence on a good Canadian Company eh?

    Looser!

  10. Adam Swimmer | April 13, 2013 at 7:37 pm

    Sorry, Doug. I got the names mixed up in my head. I meant the BlackBerry Storm – not Torch.

    I agree the Torch was a decent phone back when it launched.

  11. luc | April 13, 2013 at 9:22 pm

    How is this article not fair or bad ? he does not point anything bad about Blackberry, he stated what happens this week, and report what other analyst said, problem with Blackberry people are too sensitive. LG is now number 3 HTC will soon be number 4 so what do you expect when you read that article ? That yes hopefully the Q10 will save the Canadian company.

  12. GJN | April 14, 2013 at 2:52 am

    The new software blackberry has implemented into the Z10 and Q10 is second to none. Apple is known for its simple interface while Samsung is more of a gimmicky device if you ask me. Blackberry has redefined its software and not one line of code seems to be from the old blackberry phones. It does come with a learning curve but its a lot more simple than a SG3. The problem is blackberry’s reputation took a steady drop because of the software flaws and lack of technological advancements when compared to its competitors. I think these new phones speak for itself but the advertisement seems to be the major problem!

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