A high-level executive for BlackBerry Mobilte says he wants to capture at least 3 percent of the premium phone market in the next few years. Analysts are naturally skeptical.
BlackBerry Mobile is a unit of Chinese consumer electronics maker TCL, which licenses the right to make BlackBerry phones from the original Canadian BlackBerry Ltd and also makes budget phones under the Alcatel brand. Since its launch a year ago at Mobile World Congress, the unit has been on a mission to resurrect the brand as a viable smartphone option.
With a year under its belt, Francois Mahieu, the chief commercial officer of BlackBerry Mobile, has some high expectations for where the brand can go. Mahieu, speaking to journalists at a briefing ahead of Mobile World Congress 2018, said he hopes to capture 3 percent to 5 percent of the market for premium smartphones.
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"It doesn't have to be a niche business," he said. "I would not be satisfied with market share in premium (phones) that is sub-1 percent forever."
That's exactly where it is, with Neil Shah, an analyst at Counterpoint Research, estimating that BlackBerry sold just 170,000 phones in the fourth quarter. With the total market for premium phones (defined as above $400) estimated at 320 million units last year, Shah said BlackBerry Mobile would have to sell at least 10 million units a year, or 2 to 3 million per quarter. The expectations highlight the uncanny confidence that the TCL and BlackBerry Mobile executives feel after re-establishing the brand, which was essentially left for dead as the original BlackBerry shifted its gaze toward the more lucrative corporate software and services business. It was one of two legacy phone brands -- the other being Nokia -- trying to tap into nostalgia to get us interested in them again.
The comeback, which means consumers ultimately have more choices when picking their smartphone, has been slow.
Re-establishing credibility
While its fourth-quarter sales number seems small -- Apple sold 77 million iPhones in the same period -- Mahieu believes his team has done a lot to build a foundation of carrier support and availability for the phones."There's a sentiment that we accomplished a nice part of the journey where we're very credible," he said. "We're seeing a growing acceptance from customers and retailers to grow this further."
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Mahieu noted that the business faced skepticism during last year's launch. The doubters remain. The macro conditions aren't favorable for growth. The smartphone market fell for the first time ever in the fourth quarter, according to Gartner. And it's not like premium stalwarts like Apple and Samsung are going away.
Surprise appeal
Shah said BlackBerry Mobile needs to do a better job of building its presence in key premium phone markets like the US, Japan, Korea and Western Europe. In the US, for instance, it only has deals with carriers AT&T and Sprint, missing out on more than half the addressable market with Verizon and T-Mobile. BlackBerry Mobile executives acknowledged that they were slow with the roll out the first time around.One reason BlackBerry Mobile executives are optimistic: The profile of customers for the KeyOne and Motion phones has ranged between 25 and 45 years old, which they admit stretched to a younger demographic than they expected. It turns out, it's not just the old fogeys waxing fondly for their BlackBerry Bolds who bought the new iteration.
"There's an element where the BlackBerry brand means something for a lot of people, and not just for older generation," Mahieu said. "It can appeal to the professional, regardless of the age."
Still, it's going to take some time -- if it ever happens -- for this dream to become a reality.
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