After multiple delays pushed the highly anticipated launch of Blackberry's next-generation BlackBerry 10 platform back to 2013 and set a firm launch date. In a post on the company’s official Inside BlackBerry blog, Blackberry’s Donny Halliwell announced that Blackberry will hold a launch event for BlackBerry 10 on January 30th, 2013.
The related press conferences will take place in multiple countries simultaneously and specific launch dates for the first round of BlackBerry 10 smartphones will be announced during the event. A statement from Blackberry CEO Thorsten Heins follows below:
In building BlackBerry 10, we set out to create a truly unique mobile computing experience that constantly adapts to your needs. Our team has been working tirelessly to bring our customers innovative features combined with a best in class browser, a rich application ecosystem, and cutting-edge multimedia capabilities. All of this will be integrated into a user experience – the BlackBerry Flow – that is unlike any smartphone on the market today. Thanks to our strong partnerships with global carriers and a growing ecosystem of developers, we believe our customers will have the best experience possible with BlackBerry 10. We are looking forward to getting BlackBerry 10 in the hands of our customers around the world.
At BlackBerry World 2012, Blackberry CEO Thorsten Heins showed off a few new features of the upcoming OS, including a camera which is able to go back in time to ensure a perfect shot, an intelligent, predictive, and adapting keyboard, and a user interface designed around the idea of "flow".
Shares of Research In Motion Ltd., which have soared over the past two months on a burst of positive sentiment, fell sharply Friday 21 December 2012 as investors digested a fresh reason to worry about the smartphone maker.
After gaining momentum with the unveiling of its new BlackBerry 10 device, Blackberry released earnings that contained worrying new details about the company’s service revenue – a key source of much-needed income and Blackberry's most dependable revenue stream.
Blackberry’s service revenues are a significant source of cash. For example, in the third quarter of 2012, services were 36 per cent of Blackberry’s $2.7-billion revenues. In the second quarter, service fees added more than $1-billion to Blackberry’s bank account. This is large amount of revenue that is at risk.
On a conference call with analysts, Blackberry management were unable to reassure investors worried about declines in Blackberry’s service revenues. Combined with pessimism from analyst this send Blackberry's shares down about 22 per cent in Toronto.
Blackberry, which has struggled against Apple Inc. and Samsung Electronics Co. Ltd., hauls in roughly one-third of its revenues from wireless operators for BlackBerry access to Blackberry’s proprietary, secure messaging network. This is usually a per-device fee that ranges from a couple of dollars per month up, depending on how important the carrier is to Blackberry’s business.
As Blackberry’s market influence has faded, the company gradually lost the ability to demand hefty fees from carriers. Now, even as smaller competitors in the mobile device management field offer ways to securely transmit communications from various smartphones, Blackberry will begin offering “tiered” pricing for access to its network in a way that analysts fear will reduce a crucial source of revenue.
Kris Thompson at National Bank Financial, the analyst whose positive endorsement led to Blackberry’s unexpected 17-per-cent surge on U.S. Thanksgiving in late November, turned an about face to downgrade Blackberry's shares on 21 December 2012.
Thompson, raised his share price target from $12 to $15, capturing the positive sentiment around a company in the lead-up to the January 2013 launch of Blackberry’s new BlackBerry 10 smartphones.
On 21 December 2012, Thompson changed his mind. He downgraded the stock to “underperform” and slashed his price target from $15 to $10 on worries about Blackberry’s service revenue.
Unique among handset makers, Blackberry always pulled in extra cash from its proprietary messaging network – and fresh news in Thursday’s results reminded analysts of the risks to Blackberry’s business model.'
Blackberry has reported decent results, however, Blackberry's management disclosed that monthly service revenue will undergo a change to a tiered model.
Once the Blackberry executives were asked precise questions, they appeared poorly prepared to provide satisfactory answers about the details. It is expected that investors will punish the stock until service revenue can be better quantified.
The market no longer believes that Blackberry can sustain profitability with a standalone hardware business. Times have changed.
Analysis are quick to point out the increasing competition from iPhone 5, Android and Windows 8 smartphones in Western markets. Within this fiercely competitive and radically changed smartphone market, analysts no longer believe that BB10 devices will turn around its struggling business. There has to be more to their offering to turn Blackberry around. Their services model has to be rock solid and feature rich.
Apple has their deep and highly integrated cloud services and Android has a comparably sophisticated offering. Blackberry is building these new cloud services but it will take years for them to catch up to Apple and Google.
In short, the January 30th launch cannot turn Blackberry around. It is a nice dream to believe that devices are all you need but this is clearly no longer the case where devices plus cloud services is essential for survival.
Some analysts saw many positives in Blackberry’s 2012 third quarter. The company’s new CEO Thorsten Heins took hold of a struggling company that was missing product deadlines and had to be shocked into fighting shape.
Tom Astle of Byron Capital Markets noted Blackberry’s strong balance sheet, a new product that is raising eyebrows, a “motivated” global network of wireless operator partners and a “loyal and long-suffering user base” around the world.
There is no question that the third quarter of 2012 was a very well executed quarter because they prevailed with an ancient product line that is radically in need of a refresh.
CEO Heins believes the company's existing customer base still gives Blackberry a chance. The company has more than 80 million customers, although much of its growth is occurring in lower end emerging markets.
Blackberry also counts among its loyal customers large businesses and government agencies that value security over features.
In more developed countries such as the U.S. or its home country of Canada, however, individuals and corporations alike are dumping BlackBerrys and their once-legendary security for iPhones and Android smartphones.
For example, Yahoo CEO Marissa Mayer recently said the new company smartphone plan includes Apple, HTC, Nokia, and Samsung phones, but snubs Blackberry, not so long ago the obvious corporate choice.
The pressure has never been greater for Blackberry to show it can still make a product that can stand up to the awesome success of the iPhone 5 or the Galaxy S3.
With HTC and Nokia's strong Windows Phone 8 showings and many consumers wondering which phone to buy, Blackberry will need to pull itself together and execute a miracle to keep future smartphones and tablets on consumers' minds because they can no longer rely on the corporate market. Consumers are going to be what drives Blackberry back into the corporation.