At the Research In Motion Ltd (NASDAQ:BBRY) Live conference in Orlando on May 14, CEO Thorsten Heins let fall that there were 60 million subscribers to BlackBerry Messenger, which probably indicates that Research In Motion Ltd (NASDAQ:BBRY) is still shedding users. As of March 28, Research In Motion Ltd (NASDAQ:BBRY) stated in their fiscal year earnings report that their subscriber base was about 76 million. Still, I estimate this is about double the total number of users of Windows Phone (7-8), so BlackBerry has an ecosystem to build on.
Research In Motion Ltd (NASDAQ:BBRY) is not gaining market share however, posting a sequential decline from the 7.33 million units sold in Q4 as well as a substantial year over year decline from 9.94 units in Q1 2012. BlackBerry’s market share not stands at just 3.0%, down from 6.8% in Q1 2012.
Microsoft Corporation (NASDAQ:MSFT) is accomodating Research In Motion Ltd (NASDAQ:BBRY) by also losing market share sequentially, at 2.9% versus 3.0% in Q4. Given Microsoft Corporation (NASDAQ:MSFT)’s claims of “momentum” for Windows Phone 8, as well as Nokia Corporation (ADR) (NYSE:NOK)‘s reported sales of 5.6 million Lumia phones in Q1, I was expecting stronger sales of Windows Phones, about 8 million total. Combining the Gartner and Nokia Corporation (ADR) (NYSE:NOK) data, this means that Microsoft Corporation (NASDAQ:MSFT)’s other manufacturing partners, HTC, Samsung and Huawei only sold 390,000 phones between them.
Research In Motion Ltd (NASDAQ:BBRY) is set to start selling the more traditional QWERTY BlackBerry Q10 in June in the U.S. This is mainly intended to appeal to traditional BlackBerry users and get them converted to the new BB 10 OS. In fact, the Q10 will ship with the a revised BB 10.1, which is also being deployed in the U.S. to Z10 users this month.
At BlackBerry Live, Heins also unveiled the low-cost Q5 phone, which is similar to the Q10 in layout. The Q5 is intended for emerging markets and probably intended to blunt the success of low-end Lumia phones. After the phone was unveiled, Research In Motion Ltd (NASDAQ:BBRY)’s share price took a dive of about 4%, indicating that investors weren’t impressed.
This is understandable, since even Nokia Corporation (ADR) (NYSE:NOK)’s lowest price Lumia phones are full-touch, so that the keyboard of the Q5 seems an anachronism. Once again, I think the Q5 targets existing BB users. Research In Motion Ltd (NASDAQ:BBRY) is used in 175 countries.
Research In Motion Ltd (NASDAQ:BBRY) is attempting to leverage its still significant presence in the enterprise by introducing BlackBerry Enterprise Service (BBES) 10.1. BBES doesn’t try to fight the bring-your-own-device trend but instead work with it by giving IT managers a common platform to manage BB 10, iOS, and Android devices.
A key element of this strategy is the provision of a common messaging platform for all devices. BlackBerry Messenger (BBM) will be made available for iOS 6 (and higher) and Android 4.0 (and higher) as free apps. Since BBM operates through BlackBerry’s servers, BlackBerry is essentially serving as the guarantor of the security and privacy of communications via BBM regardless of device. Initially, BBM on non-BB devices will be a very basic text messaging app, but by the end of the year Research In Motion Ltd (NASDAQ:BBRY) promises full parity with the BB 10.1 version, including video chat, and a Twitter-like service of BBM called Channels.
BlackBerry Balance, which keeps personal data, communications, and apps segregated from business use continues to be appealing to IT managers. Research In Motion Ltd (NASDAQ:BBRY) claims that BB10.1 is the most secure mobile platform in the world. While this is debatable, BlackBerry is probably the most trusted by corporate and government users, just on the basis of extensive prior experience. According to Heins, the U.S. Department of Defense is committed to Research In Motion Ltd (NASDAQ:BBRY) as a critical component of their communications infrastructure.
