RIM Boldly Prices new Blackberry out of the Market

by Matt Klassen on August 24, 2011

Blackberry Bold 9900

For anyone following the tumultuous tale of Research in Motion of late, its clear the Waterloo-based company needed to do something bold, something that would demonstrably show the company’s naysayers that it could innovate and once again capture the public’s attention.

So, with the tech world focused squarely on the Google-Motorola merger last week, RIM did it best to keep its Blackberry brand in the spotlight, releasing the 9900 series featuring its new Blackberry OS7. With all of the major American carriers picking up one variant of RIM’s new Blackberry or another, the blogosphere is now awash with stories about RIM’s bold move…but for all the wrong reasons.

Likely designed as a vote of confidence in a strong product but seeming more like a foolhardy move from a disconnected management team, it was announced last week that RIM’s new Blackberry Bold 9900 would be available through T-Mobile for a staggering $299.99—and that’s after a $50 mail-in rebate.

If there’s an economics lesson that’s to be had here, its most likely this: when the popularity of your brand is waning, when the sales of your flagship mobile devices are lagging behind your competitors, and when you’re attempting to enact a recovery strategy, don’t price your phones $100 more than the popular devices that you’re chasing.

While things are a little different here north of the border, the bleeding edge of mobile technology in America typically sells for $200—this is the price point of the new iPhone and other market leading devices—and to place the price tag of your device well over this benchmark  is almost certainly going to cause problems for any company’s sales figures.

In response I’m sure diehard Blackberry supporters will point to the fact that the Bold 9900 is the first 4G compliant Blackberry device, a point that both T-Mobile and RIM are using to justify the ludicrous price. But with the popularity of the Blackberry brand diminishing rapidly, even among the once rock solid corporate market, perhaps a competitive price and a solid marketing campaign would be better suited to actually selling these phones.

That said, with T-Mobile offering corporate clients an opportunity to get their hands on this new Blackberry before the general public—public availability begins on August 31st—it will be interesting to see how many of them bite on this large price tag, particularly given the nation’s renewed interest in fiscal responsibility. In my mind, this exorbitant price may be the reason many clients need to finally jump ship and leave the Blackberry brand behind.

If the pricing of the Blackberry Bold 9000 series—Verizon and Sprint Nextel both offer this phone at an almost equally ludicrous $249.99—should prove to be the downfall of this device, it could have additional fallout for RIM itself. While many factors contribute to the pricing of a given device, the public perception here is that RIM is perhaps over-confident about the strength of its hardware, almost to the point of cockiness.

Of course this wouldn’t be a bad thing if the company was, say, perhaps named Apple, but RIM has struggled of late, a situation that has led many to speculate that RIM’s management may be completely out of touch with the current needs of the mobile consumer…like the need for an affordable 4G Blackberry.

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Written by: Matt Klassen. www.digitcom.ca. Follow TheTelecomBlog.com by: RSS, Twitter, Facebook, or YouTube.

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{ 2 comments }

jack Bar August 24, 2011 at 10:17 pm

If you take corp communication seriously….Blackberry is the only device. if you want a great looking phone with 10,000 fart applications iPhone is your choice. The reality Rim is loosing the battle for consumers….so whats left…the “Blackberry iPhone” would be ideal. if RIM stock keeps falling, a hostile takeover is all Apple needs to dominate. problem is that Rim depressed stock price is not based on fundamentals when you have such a market share and such huge cash reserves.

Daniel August 25, 2011 at 4:00 pm

I like the casio commando it fits anywhere .

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