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BlackBerry’s New Phones Score Points on Technology

Despite some novel features, the smartphone maker will struggle to regain market share.
January 30, 2013

Struggling smartphone maker BlackBerry—the company previously known as RIM—launched a comeback in the form of two new phones today: a Z10 with touch screen and a Q10 offering a retro tactile QWERTY keyboard, both running on its new BlackBerry 10 operating system.

If technology alone were enough to make the difference, a comeback might be all but assured. The devices impress: they offer a slick way to sweep between multiple running apps without having to shut one or more down, and useful ways to separate work and personal functionality. For avid e-mailers and texters, BlackBerry’s traditional fan base, the operating system includes a novel word-suggestion interface that, among other things, can switch automatically between different languages.

BlackBerry, based in Waterloo, Ontario, is struggling to hold on to shrinking market share. While the company still has 79 million users, it lost a million of them in the last quarter, and has just a 6 percent market share in the United States (see “Rim Is Down But Not Out”). The new BlackBerrys will be competitive but not exactly cheap: Verizon today was the first to announce it would sell them, for $199 with contract.

With half of existing BlackBerry owners saying they will buy a new phone in the next year, a crucial first step for the company is to retain them, and the new offerings give these users little reason to complain, said Charles Golvin, principal analyst at Forrester Research, in an interview after the launch. The event was attended by nearly 900 people at a cavernous indoor basketball facility along the East River in Manhattan.

“Who can judge what people will do—but it’s hard to see why someone who owns a BlackBerry today, and is considering switching, would look at this and say, ‘They have fallen short,’” said Golvin, who had tested the device for a week. “There is no question in my mind here that RIM has delivered some serious innovation, quality of hardware, and quality of software. They haven’t just met the bar of what Android and iOS and Microsoft have offered, but in some cases have exceeded it.”

The operating system includes some genuinely novel features. The user interface is based on the concept of “flow”—allowing you to move smoothly through different applications without shutting or pausing one or another. For example, you can push a video screen aside to “peek” at an incoming e-mail and maybe deal with it, while still having a portion of the video visible and still playing. Then you can slide back to return to it.

Applications are designed to minimize the need to interrupt what you are doing to switch settings. For example, if you are inputting text in English and making use of suggested word choices—but your next e-mail is to a colleague in Spain, you don’t need to go back to a settings page to change the language to Spanish. After typing a few of the words in the other language, the system will detect which words you are typing and start to change suggestions to ones in the appropriate language.

And in both cases, the word-suggestion feature is a lot better than what I have on my iPhone 4S, which forces you to “X” out a suggested word, or else makes puzzling changes by default. On the Z10, the suggested words appear in small type just above the letter on the touch screen. If you like the choice, you can sweep your finger upward to use that word in the sentence. Simply tapping the letter will only type the letter, not the whole word, which means you don’t end up using incorrect suggestions.

Suggestions get better over time by learning your writing style and drawing on information from your social networks. The operating system was able to suggest the word “Jared” to me because (I think) I had recently e-mailed a “Jared.”

Importantly for a company whose core users are in the enterprise, the phones feature a neat, if not entirely novel, way to swipe between work mode and personal mode. A corporate IT department can maintain full control over the one, while the phone owner fully controls the other.

In an interview session after the announcement, CEO Thorsten Heins said BlackBerry’s secure network will still be brought to bear on the enterprise side. “When you see work and personal profiles in BlackBerry Balance, the ‘work’ profile will be behind the firewall,” he said, explaining that it would be integrated with BlackBerry’s Enterprise Service, a platform that BlackBerry offers businesses.

Frank Boulben, chief marketing officer for BlackBerry, is betting that such features will be enough to get the company back on track. “That’s how we will win the hearts and minds of U.S. consumers,” he said.

App availability may, however, be an Achilles’ heel. While BlackBerry has gotten many popular apps to work on its operating system, including what it says are the 1,000 most popular apps, the raw numbers are still troubling. The total is only 70,000, an order of magnitude behind Apple’s iOS and Google’s Android.

When the devices will be available is a little murky. BlackBerry representatives say the Z10 will be available in March, and Heins said the tactile Q10 would be available in April. Although Verizon was the first to announce, Sprint said it will sell an LTE BlackBerry Q10, AT&T said it will sell both, and T-Mobile said it will sell the touch screen Z10.

In many ways, the phones are well designed and boast some interesting new features. But, of course, so do the latest offerings from the other, bigger smartphone makers. One thing BlackBerry has that the others don’t is pop star Alicia Keys, who has signed on as a creative director and de facto spokesperson. “I find that in my life, the majority of people consider one phone a play phone, and a BlackBerry a work phone. There is an incredible opportunity to bridge that gap,” she said. End users will decide if she’s right.

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