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BlackBerry Chief Executive Officer Thorsten Heins, speaking at the company's annual conference in Orlando, Florida, unveiled a new model and said his turnaround plan for the long-struggling smartphone maker is working.
Heins unveiled the BlackBerry Q5, a lower-end phone with a physical keyboard that comes in four colours, and said the new BlackBerry 10.1 operating system will roll out today, featuring a Skype phone application. The Q5 will be available in emerging markets beginning in July.
"We have reached solid ground with this company," Heins told software developers, suppliers and corporate customers at the BlackBerry Live event. "Not only are we still here, we're firing on all cylinders."
In the year since the company's 2012 gathering, Heins has worked to streamline the business and return it to profitability, surprising analysts. After cutting 5,000 jobs and eliminating six of 10 manufacturing sites, Heins now faces the challenge of reviving sales growth with BlackBerry's new smartphones.
The Q5 is the third phone in the company's new BlackBerry 10 line-up and the first targeted at consumers in developing economies. BlackBerry demand in those markets has held up better in recent years than in the US, where Apple Inc's iPhone and Google Inc's Android have snatched away market share.
Heins said the Q5 was "specifically designed for select markets such as emerging markets". The new phone will be key to BlackBerry competing with low-cost Android models overseas, said Adam Leach, an analyst at the London-based research firm Ovum.
"The Q5 could be a very significant device for the company, as there is a significant opportunity for high-quality low-cost smartphones," he said in an emailed statement.
"Emerging markets accounted for roughly 17 per cent of the nearly 450 million smartphone shipments globally in 2011."
The phone Heins showed off was cherry-red and resembled a more basic version of the Q10, a model that went on sale in Canada and the UK about two weeks ago. Heins also demonstrated BlackBerry 10's mapping and videoconferencing features in a black Bentley Continental convertible, displaying how the software can work with technology beyond phones.
The company's flagship model is the Z10, a touch-screen device going head-to-head with the iPhone 5 and Samsung Electronics Co's Galaxy S4. Reports of the phone's sale performance have been mixed, with some analysts seeing lacklustre demand and speculating that production has been cut. BlackBerry shipped about 1 million Z10s in their first quarter on sale, in line with estimates.
The Q10, meanwhile, will go on sale in the US in early June, Heins said, pushing back the target from late May.
BlackBerry shares fell 1.5 per cent to $15.64 at 10:35 a.m. in New York. The stock had climbed 34 per cent this year through yesterday.
T-Mobile US Inc, the fourth-largest US carrier, said today that it will offer the Q10 for $99.99 down and monthly payments of $20 - part of its new instalment-plan approach to selling smartphones.
The model, which has a physical keyboard designed to appeal to the BlackBerry faithful, has been faring well in other markets, said Mark Sue, an RBC Capital Markets analyst. Heins told Bloomberg News last month that the Q10 should sell in the "several tens of millions," without giving a time frame.
'Healthy' sales
Sales in the UK and Canada, where the Q10 first went on sale, "remain healthy," Sue wrote in a report yesterday. He has a neutral rating on the stock.
A bigger test of the Q10's appeal will be when it goes on sale in the US BlackBerry faces an uphill battle to win back market share it has ceded to Samsung and Apple in recent years.
Samsung accounted for a third of smartphone sales last quarter, while Apple had 17 per cent, according to research firm IDC. BlackBerry saw its share fall to 3.2 per cent in the fourth quarter, before the company dropped out of the top five in the first three months of this year.
BlackBerry Live attracted about 5,000 people to Orlando, the same or slightly better attendance as last year, according to Kiyomi Rutledge, a spokeswoman for BlackBerry. The Waterloo, Ontario-based company is giving out free Z10s to attendees.
BLACKBERRY Q5
Display: 3.1-inch, 720p x 720p capacitive multi-touch
Processor: 1.2GHz dual core
Memory: 8GB internal, expandable via microSD
Camera (rear/front): 5MP autofocus with LED flash/2 MP
Source: Tech websites, company release
