January 31, 2013, 10:14 AM

The fading BlackBerry unveils new smartphones

Will they be popular enough that retailers have to pay attention?

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In what may be a last stand for relevance, BlackBerry has unveiled the BlackBerry 10 line of smartphones—redesigned devices that take aim at Apple Inc.’s iPhone and high-end smartphones running the Android mobile operating system from Google Inc.

The first two smartphones to roll out are the BlackBerry Z10, with a 4.2-inch touchscreen, and the BlackBerry Q10, with a smaller screen to make room for a full hard keyboard à la classic BlackBerry devices. The phones go on sale in the U.S. in March. They will be available on all four major U.S. carriers. The phones are expected to cost $199 with a two-year wireless contract, the same price as the iPhone and some high-end Android devices.

The new devices come with an entirely new mobile operating system, called BlackBerry 10. The operating system and many of the apps that will come pre-loaded on the phones are designed for consumers who are big on multitasking and social media, the company says. The BlackBerry app store features 70,000 apps, a far cry from the more than 700,000 in the Apple App Store, for instance.

Years ago BlackBerry dominated the smartphone market. In 2007 Apple introduced the iPhone and the smartphone market took off, paving the way for Android devices. Today, 52.5% of smartphones in use run Android, according to web and mobile measurement firm comScore. The iPhone stands at 34.3%, BlackBerry at 8.4%, Windows Phone at 3.6%, Symbian at 0.6%, and other minor operating systems at 0.6%.

The question for retailers is: Can the new BlackBerry phones and operating system make BlackBerry a major player once again, in turn creating the need to optimize sites for BlackBerry and develop BlackBerry apps? The answer? Too little, too late, some mobile experts say.

“BlackBerry is unlikely to topple Apple and Google, as they are too well entrenched, and, quite frankly, there’s nothing wrong with their products, people love them,” says Avi Greengart, research director, consumer devices, at research firm Current Analysis Inc. “But that’s OK. BlackBerry does not need to beat Apple and Google, or return to its former market share; if that is the measuring stick for success, BlackBerry will almost certainly fail. The smartphone market is now much larger than when BlackBerry dominated. The company needs to reverse its subscriber declines, and return to profitable growth.”

While some experts like what they see in the BlackBerry 10, they’re pessimistic about BlackBerry’s chances of regaining lost ground. The BlackBerry 10 platform is different from its competitors—it stands out from the Android masses and is distinct from the iPhone, says Adam Leach, principal analyst at technology research and consulting firm Ovum.

“The user experience of BlackBerry 10 introduces some nice new features but importantly builds on BlackBerry’s user interface heritage and therefore will certainly appeal to existing BlackBerry users. However, the challenge for the company will be to attract new users and those that have already moved to alternative smartphones,” Leach says. “BlackBerry has rightly focused on ensuring that the BlackBerry 10 devices have a large catalog of content and applications, which is now essential for any modern smartphone, and achieving 70,000 applications at the launch of a new platform is a good start.”

But despite a well-designed platform that will attract short-term interest from existing users, Leach concludes, BlackBerry will struggle to appeal to a wider audience and in the long term will become a niche player in the smartphone market.

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