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SA big driver of BlackBerry sales

Sep 28 2012 16:37
Cape Town - South Africa is currently one of the main countries driving BlackBerry maker RIM's global sales, said Simon Leps, CEO of Fontera Digital Works.

He was reacting to Research in Motion's announcement on Thursday that it lost $235m in the past quarter. The better-than-expected results led to a surge in its stock price. 

Recently CEO Thorsten Heins acknowledged that SA is one of RIM's most loyal markets: "South Africa is a priority one market for us, and we will acknowledge that with the launch of BlackBerry 10.

"There will be three waves in taking it to global markets, and South Africa and Nigeria are in the top range of Wave 1 launches."

Leps said BlackBerry competition in other markets bodes well for South African consumers. This is because as it loses sales and shelf space to iOS, Android and soon Nokia in the US and Europe, RIM will increasingly begin driving sales in countries like South Africa.

"This may result in better pricing, services and product offerings for consumers locally, as they aim to safeguard their strong market presence."

On BlackBerry's future outlook, Leps said everything still hinges on the BlackBerry 10 (scheduled for launch in the first quarter of 2013).

"If they manage to pull a huge rabbit out of the hat early next year, then they may see  positive signs of a recovery.

"However if BlackBerry 10 is a failure, RIM will be finished as a standalone handset manufacturer."

Leps is optimistic about BlackBerry 10, saying the sneak peek RIM afforded the press this week revealed interesting functionality, some of which is unique to BlackBerry and not yet available on other platforms.

"However, these new features may fail to drive the necessary sales and are not as innovative and exciting as the features offered by Samsung, Apple and even Nokia."

Leps said it has become apparent that RIM is starting to lag its competitors.

"Even the mid-level phones from BlackBerry, such as the Curve, are being outclassed by new devices from Nokia and Samsung that are far more advanced and significantly cheaper.

"This all goes back to innovation - RIM used to have the top developers and product people working for them; those people are now working for other companies."

He warned that should RIM continue its poor performance in the long term, it is going to be much harder for the embattled company to attract and retain the best developers and other staff. It will also be more expensive to borrow money, which could impact long-term innovation.

'If they don't have the access to affordable debt financing and are not able to offer share options to recruit new and retain current staff, then they are going to continue down the spiral that they're currently in."

blackberry  |  rim  |  smartphones



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