BlackBerry Launch Delays Continue

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This was definitely not part of the plan. When BlackBerry (NASDAQ: BBRY  ) unveiled its BB10 OS in January and introduced the world to its new phones, the market reaction wasn't what CEO Thorsten Heins was hoping for. One of the primary reasons for the immediate drop in share price after the BB10 announcement was the delay in releasing BlackBerry's Z10 and Q10 phones here in the States.

Right or wrong, smartphone manufacturers are at least partially measured by how well they do in America, and there's some logic to that. U.S. consumers are nuts about their smartphones, as Apple (NASDAQ: AAPL  ) can attest. With little to no (relatively speaking, of course) market share outside America, Apple has essentially built a profit-generating machine based initially on its domestic iPhone sales. That's why BlackBerry's scheduled Z10 and Q10 U.S. release dates are so important.

The latest
First, a quick distinction: The difference between BlackBerry's Q10 phone and its Z10 version is that the former comes with a physical keyboard, a significant feature and a crucial differentiator for many BlackBerry fans.

As for the Z10, it's already out, but only in limited markets. If the rumors are true, and according to Heins they are, BlackBerry's Z10 is off to a nice start in the U.K., and pre-sales in BlackBerry's backyard of Canada are supposedly going gangbusters. What about the U.S.? According to Heins, we should see the Z10 sometime in mid-March, give or take, just as he mentioned at the BB10 launch last month. The delay is being blamed on domestic wireless carriers and their overly strict testing requirements.

Those strict testing requirements are also behind BlackBerry's latest stroke of misfortune. The Q10, according to Heins, won't be in the U.S. for "eight to 10 weeks after a carrier releases a model with only the touchscreen (the Z10)." After doing some quick math, the release date for the Q10 should be sometime in May or June, barring additional delays.

As you might imagine, Heins isn't pleased with the hiccups, saying, "Am I a bit disappointed? Yeah, I would be lying saying no. But it is what it is, and we're working with all our carrier partners to speed it up as much as we can."

The impact
By the time the Q10 hits U.S. shores and shortly after we see the Z10, one of BlackBerry's prime competitors, Nokia (NYSE: NOK  ) , will have reported its fiscal Q1 results, including recent sales figures for its Lumia flagship phone. If it's able to keep the Lumia ball rolling -- it announced sales of 4.4 million units in Q4 and 80 million total -- BlackBerry will be even further behind in its return to relevance. Like Apple, BlackBerry is also neglecting huge areas of the smartphone world, with both the Z10 and Q10 priced well beyond the means of emerging market consumers. With an additional four phones scheduled for release this year, according to BlackBerry's Jan. 30 BB10 announcement, perhaps one or two of those will target the non-subsidized markets. But that's a hurdle that'll need to take a backseat to BlackBerry's domestic delays, at least for now.

Do the delays of both smartphone model spell the end of BlackBerry? No. If nothing else, we've learned in the past couple of years that BlackBerry users are nothing if not loyal. But in the ultra-competitive smartphone industry, years are measured in weeks and months, and you can bet BlackBerry will pay a steep price for its delays.

Two things need to happen from here: No. 1, do not be late again, BlackBerry. Period. No. 2, those phones, with that new OS, better be good -- really, really good. If so, all will be forgiven. If not, even BB10 won't be able to save Heins and his team.


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Read/Post Comments (9) | Recommend This Article (1)

Comments from our Foolish Readers

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  • Report this Comment On February 06, 2013, at 9:26 PM, jwyoungy wrote:

    I agree that BlackBerry could pay a price for these late releases in the U.S. and that is not really fair. I wish someone from the U.S. carriers would explain why they couldn't speed things up a little bit or why one carrier doesn't think it's worth sprinting ahead to be the first one to release it by a couple of weeks. I'm thinking the U.S. carriers are think headed with regards to the true value of the new blackberry phones. I bought the Z 10 yesterday and I love it. I hope the American market understands what is going on and supports BlackBerry, they won't regret getting this phone.

  • Report this Comment On February 06, 2013, at 11:17 PM, TimmyBee123 wrote:

    Don't worry, these are just hiccups. By this time next year, people will be laughing about how nonsensical all of this worrying is.

  • Report this Comment On February 07, 2013, at 7:20 AM, bunchofdonkeys wrote:

    Tim, according to you (and previous post that you have made) This phone and this company will NEVER work said it's "much like the Palm" story and it can't compete against Lumia and is likely DOA. Time to start the good old backpedal :). We will all just sit and what you "fools" squirm while bb10 doesn't everything you said it won't/can't launch successfully :)

  • Report this Comment On February 07, 2013, at 7:31 AM, timbrugger wrote:


    I think you may have me confused with another Fool writer. I've certainly never compared BB with the Palm story, nor have I said it can't compete with Nokia. Challenges? You bet, lots of them, and I don't think that can be denied. But I've gone on record (several Fool articles) that I like what Heins is, and has been, doing of late - giving BB a chance when many thought there was none.

    PS - yes, I do like Nokia, too, but not to the exclusion of BB.

    Thanks for the post, and let's hope there is some squirming as BB rises from the ashes! Thanks again, Tim.

  • Report this Comment On February 07, 2013, at 7:57 AM, bunchofdonkeys wrote:

    Ok Tim,

    Maybe the Palm comparison was another fool on the panel but you've been VERY clear that this is not where you would invest your please stay the course! I bought rim at 7 dollars and I've read over and over how this was a sinking ship and to stay far away (that seems to be the feeling with 90% of the fools that post or do videos) and thank God I had the brains to NOT listen to the so called pros....It's very clear that BB is heading to the 3rd position quickly!! Time to take the apple blinders off because this is happening now!

  • Report this Comment On February 07, 2013, at 8:12 AM, marv08 wrote:

    It's not really like January and February are the hottest shopping season in the US. Looking at the full year, this delay should not have that big an impact.

    The only real question is how much the wealthier consumers like the device. And it's far too early to tell. Initial sell-outs show pent-up demand. But that is not surprising, we did know that BB has its fans. It will at least take 2-3 quarters to see if there is a success beyond these fans. With WP7 and, likely, WP8 there was a clear steep decline in demand after initial sell-outs. If BB can do better, and I assume they will, they could do well. And by "well" I do not mean Samsung or Apple-like numbers, this will never happen, but sustainable.

    Besides messing up the US carrier certification, BB's strategy for the roll-out was quite sound. The UK and Canada are strong markets for them, and, more important, markets that do buy the higher end devices. BB should not focus on market share and developing countries first. Selling millions of Curve-level devices at a loss in India will do nothing for their bottom line. Especially since they announced to bring down or even drop the subscription charges for consumers. Selling devices at a loss and then adding in free services is not a recipe for success.

    Building completely new devices is costly. The initial roll-out consumes considerable amounts of cash to stuff the channels. Doing that with low/no profit devices is suicidal (and not everybody has Amazon's lunatic investors to applaud that). No idea if BB is getting anywhere, but their strategy makes good sense.

  • Report this Comment On February 07, 2013, at 8:52 AM, sammycooool wrote:

    You are really late to the BBRY story, you will be announcing a BUY and OUTPERFORM on this stock when it crosses $ 25.00/shr. The action will really begin later in March when we see that Nokia sales are down due to Z10, you can get it tight now or wait like some others and buy the stock at much higher prices.

  • Report this Comment On February 07, 2013, at 8:53 AM, greenember wrote:

    Why does every analyst assume that the success of BlackBerry or Nokia will come at the expense of the other? There ARE users that will switch from iOS or Android. If you don't think there are, then your analysis is very flawed... like the one on this page

  • Report this Comment On February 07, 2013, at 10:24 AM, etgh wrote:

    What delay ???

    How can a fully disclosed announcement of the availablity of a product, without change be seen as a delay ?

    BBerry anounced, delivered and gave future dates as indicated. It's only the media who have created a fantasy of missed delvery dates and "late" product lauches. How can you expect a company to deliver based on what the media expects and then call them out for being late by keeping to their original announced schedule ?

    I know it's reflex to bash BBerry, but really...

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