Research In Motion Ltd (NASDAQ:BBRY) is making a strong push to re-emerge as a player in the smartphone business. Its Z10 is now available in the US, and its Q10 will follow later this spring. In May, the company is expected to announce more handsets running its BB10 operating system.
Google Inc (NASDAQ:GOOG)’s Android has always appeared on a variety of handsets, standing in stark contrast to Apple (NASDAQ:AAPL)’s one-size-fits-all smartphone policy. Yet both strategies have had their limitations. Research In Motion Ltd (NASDAQ:BBRY)’s strategy could combine the best of both worlds.
Apple vs Google
As Research In Motion Ltd (NASDAQ:BBRY) has faded, Apple (NASDAQ:AAPL) and Google Inc (NASDAQ:GOOG) have come to dominate the smartphone market, both in the US and throughout the world. Both have pursued different strategies to a great degree of success, but both have run into limitations.
For Apple, the company has been able to offer a consistent, high-quality experience to both users and developers. Consumers can feel confident they are getting a quality phone with an intuitive interface; developers can sleep easy knowing their apps will work for all iOS users.
For Google, Android has been developed as an open source operating system, leading to mass adoption. Users can find an Android phone to fit whatever desire they may have — large phones, small phones, cheap phones, QWERTY keyboard phones, and so on.
Unfortunately, both strategies have weaknesses.
Apple’s one-size-fits-all doesn’t fit everyone
Although Apple has over 40% of the smartphone market in the US, its share of the global smartphone market is less than half of that. What’s more, its share of the market in the US could fall as new devices exploit new consumer demand.
Apple’s iPhone carries a hefty price tag, so many consumers in developing nations simply can’t afford it. The iPhone 5 can cost over $900 without a carrier subsidy, and even the nearly three year old iPhone 4 can run over $400. Most consumers in countries like India and China do not have the luxury of a carrier subsidy, meaning the devices are out of their reach.
Furthermore, the iPhone comes in only two hardware configurations, leaving those who want larger screens or physical keyboards out in the cold. During Apple’s last conference call, CEO Tim Cook affirmed the company’s belief that the iPhone 5’s four-inch screen was ideal, yet many consumers have shown a preference for the larger screens offered on handsets made by companies such as Samsung.
Android’s fragmentation could be its undoing
For its part, Google’s Android is famously fragmented, with only about 13% of Android devices running the operating system’s latest version, Jelly Bean. Furthermore, the open source nature of Android has led to speculation about security.
Because of Android’s fragmentation, many app developers have opted to release their applications on Apple’s iOS before later bringing it to Android (Instagram is a major example). To create an app for iOS, a developer need only test it on a couple phones; for Android it could require compatibility tests with dozens of handsets.
Both BlackBerry CEO Thorsten Heins and Apple’s Phil Schiller have attacked Android on security grounds. As Google freely gives away the operating system’s source code, the ability for hackers to find exploits seems more likely than for a controlled system such as iOS or BB10.
BlackBerry’s rumored roadmap
Last week, twitter account @BB10Leaks tweeted an image of what appeared to be a leaked Research In Motion Ltd (NASDAQ:BBRY) 10 device roadmap. The same account tweeted a followup image April 1, suggesting that the roadmap was a holiday prank.
Nevertheless, the image might not be that far off the mark. Heins has said the company is planning more phones, some that could be released this year.
Heins told The Canadian Press that the company is planning to release BlackBerry 10 phones at lower price points, appealing to consumers with smaller budgets, and those in the developing world. Heins also said the company intends to launch something “exciting” for the holiday season. If the roadmap is any indication, it could be a BB10-powered tablet or a phone sporting a large display.
BlackBerry’s docking device
Motorola experimented the with the docking concept years ago: the Motorola Atrix was capable of powering a laptop shell that gave the phone netbook functionality. Yet it never really caught on: the Android-powered Atrix sold moderately well, but never generated the buzz of Samsung’s Galaxy line up.
Heins has said BlackBerry wants to explore this concept, pushing BB10 as an all-encompassing mobile computing platform. BlackBerry’s head of marketing told Reuters the company plans a docking device for the Z10 that would allow the phone to power a monitor, keyboard and mouse, creating a desktop replacement.
BlackBerry as the third player in the smartphone wars
Despite the rally Research In Motion Ltd (NASDAQ:BBRY) shares have experienced over the last six months, the stock remains heavily shorted, with nearly one-third of the company’s shares bet against.
Many investors, then, still seem to believe the company is poised to fail in the smartphone market. But the strategy the company looks to be embracing — a tightly controlled operating system spread out over a variety of devices — combines the best of both Apple and Google’s mobile strategies. That could be a winning formula, allowing Research In Motion Ltd (NASDAQ:BBRY) to establish itself as a third player in the mobile space.
The article BlackBerry’s Hardware Flexibility Gives It An Advantage originally appeared on Fool.com and is written by Salvatore “Sam” Mattera.
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