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RIM also has its eyes set on new, entry-level, and midrange smartphone buyers with BB10

News by Andrew Kameka on Friday September 28, 2012.

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The chances of existing Android or iPhone users migrating to BlackBerry are not as high as the opposite happening. Though RIM remains optimistic that it can recapture market share in the high-end, it has decided to rebound by attracting a different type of smartphone customer - the first-time buyer.

RIM has traditionally placed most of its focus on enterprise users and high-end smartphone buyers. That will not be the only avenue that RIM pursues with BlackBerry 10. During its second quarter earnings call held yesterday, CEO Thorsten Heins said:

"...We believe that [with] the strength of the BlackBerry 10 product, we actually can also win market share back from other competitors. Third, don't forget that the market today is at 30% of smartphone penetration on average. So we are pretty confident that if you think about the people moving from feature phones to smartphones, then we can also catch a significant share of these [consumers] because we are really providing with BlackBerry 10 a whole new user experience. And that's why we run a big global marketing campaign driven by Frank Boulben, our new CMO, to really have a global launch and actually go after these 3 segments in parallel in a global launch procedure."

Heins believes that RIM has a strong chance of attracting a buyer who has never purchased a smartphone, a potentially lucrative, but challenging market. First-time smartphone buyers are likely to ask for a familiar name or recommendation from a salesperson. The iPhone has the biggest brand recognition of any mobile device, and a sales person is more likely to suggest that device or a plethora of Android phones in various form factors and price points. BB10 could grow as smartphone penetration increases, but only if its coinciding marketing campaign is wildly successful.

RIM's fate will be determined by its ability to attract new customers in the high-end, midrange, and first-time markets with BB10. Android has become the most widely used operating system because there are so many options that a handful of different devices are bound to appeal to customers of every tier. RIM will not resign itself to only compete at the top level because that strategy won't produce the turnaround necessary to improve its market share. The company aims for third place at the moment, and it will need growth in all tiers to make that happen.

Heins confirmed that RIM will use BlackBerry 7 as its entry-level operating system, but it may also have an entry-level BB10 phone. It will definitely introduce midrange products, as Heins promises, "BlackBerry 10 will proliferate into the mid-tier, probably by fall this year, and we're working on a concept for an entry-level."

source: RIM

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Andrew Kameka
Andrew is based in Miami, Florida.

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