RIM unveils BlackBerry Z10 and Q10, but pushes U.S. launch to March

NEW YORK--After more than a year of buildup, Research In Motion (NASDAQ:RIMM) officially unveiled its BlackBerry 10 platform at a media event here and pinned its financial future on both the platform's new software features and a range of BB10 smartphones designed to revive its flagging sales. RIM CEO Thorsten Heins said that the company will be renamed "BlackBerry," unifying and simplifying its brand.

BlackBerry Z10

Click here for complete details of the BlackBerry Z10 and Q10

RIM plans to release at least six BB10 devices in 2013, beginning with an all-touch device, the 4.2-inch BlackBerry Z10, and a phone with a Qwerty keyboard, the BlackBerry Q10. In Canada, the Z10 will launch on Feb. 5. In the United Kingdom, the Z10 will be available Thursday. However, in a move that could curtail early sales, Heins told the Wall Street Journal before the event that the phones will not be available in the U.S. market until mid-March, blaming the delay on the longer time it takes for U.S. carriers to test new devices. "They do the best they can," he said. "Would I have loved to see it earlier? Absolutely. Make no mistake everyone's trying to pull the date in."

Verizon Wireless (NYSE:VZ) said it will launch the Z10 for $199.99 with a two-year contract, but did not give a release date. Verizon also said it will launch the Q10, but did not give a price or release date. Sprint Nextel (NYSE:S) said it will launch the Q10 later this year but it did not give availability or a price. AT&T Mobility (NYSE:T) said it will sell the Z10 and Q10 but did not give prices or release dates. T-Mobile USA said it will sell the Z10 but didn't provide details. Heins said at a press conference here that the Q10 should be available in the U.S. in April.

The platform's release--the culmination of months of wooing carriers, application developers and corporate customers--is RIM's attempt to catapult itself back into relevance in the smartphone market, which the company once ruled but which has become dominated by Google's (NASDAQ:GOOG) Android and Apple's (NASDAQ:AAPL) iOS. Analysts think that BB10 represents RIM's last shot to regain market share and stabilize itself.

At the event, Heins said that Blackberry is "one brand, it is one promise. ... We have redesigned the BlackBerry experience. We have reengineered our products. We have reinvented this company."

The release of BB10, which was delayed twice, comes as RIM's smartphone market share has plummeted in recent years. According to IDC, RIM captured 4.6 percent of the global smartphone market for the full-year 2012, down from 10.3 percent in 2011. RIM's market share has dropped primarily due to consumers bringing their iPhones and Android phones to work, replacing BlackBerry devices they formerly had. Enterprises, in turn, have adapted and have launched new mobile device management software to handle those devices. RIM is trying catch up in that regard; its new BlackBerry Enterprise Service 10 platform supports BlackBerry devices alongside iOS and Android devices.

RIM CEO Thorsten Heins BlackBerry 10

RIM CEO Thorsten Heins introduces BlackBerry 10.

Illustrating the challenges RIM faces in its comeback, industry analyst Horace Dediu, who write the blog Asymco, told the New York Times that in the United States about 11 million BlackBerry users switched to other phones between 2009 and the middle of last year. RIM still has 79 million BlackBerry subscribers worldwide though.

BlackBerry 10 is a full redesign of RIM's existing BlackBerry operating system. Heins said the platform is for people who are "true multitaskers" and "hyper-connected socially," who want to get things done on their phones,

Heins also indicated that BlackBerry 10, which is based on software from QNX, will be used for machine-to-machine applications, something he has indicated in the past. "We have created a platform that is able to work with other machines," he said, adding that RIM can "extend it to devices, to the home, your healthcare system or wherever you are. This is the promise of the BlackBerry 10 platform."

The new platform features a new user interface, BlackBerry Flow, which allows users to scroll seamlessly between apps. BlackBerry Peek allows users to glance at another application without leaving the one a user is currently running. BlackBerry Hub combines users' various inboxes, messages and social media notifications. The platform's virtual keyboard sports advanced algorithms that will track where users touch each key to make the keyboard more responsive. Additionally, gestures and swipes will allow users to fill in words the platform predicts users want to type and can seamlessly switch between languages.

RIM is also remaking its core BlackBerry Messenger service, which has 60 million users worldwide. The service now supports video calling and screen sharing, allowing users to control a contact's screen and share what is on their display. RIM also unveiled a built-in Picture Editor to edit photos, and Story Maker, which lets users create mini movies. BlackBerry Remember is another feature integrated into the Hub, which lets users flag messages, assign due dates, take voice notes, add attachments and pull in contacts as well as integrate with Evernote accounts.

Another key feature of the new platform is BlackBerry Balance, intended to appeal to CIOs, which completely segregates personal and enterprise data on devices and allows IT managers to remotely wipe corporate data from the phones while leaving personal data intact. Additionally, Balance can stop users from copying corporate data from the business side of the phone. However, it offers a single, unified consumer experience on the same device. Heins said he hopes this will make people "move from two devices to one and that it will be a BlackBerry 10."

For BB10 to succeed, support from enterprises will need to be mirrored by an aggressive push from carriers. Verizon, AT&T Mobility (NYSE:T), Sprint and T-Mobile USA each confirmed earlier this month they will support BB10, though it is unclear when they will roll out their first devices. Rogers, Bell Mobility and Telus in Canada have all committed to BB10, as have all four of the major operators in the United Kingdom.

At the same time, getting RIM's corporate and government customers to upgrade to BB10 will be crucial for RIM's success this year, and the deployment of BES 10 will be a major part of that. Earlier this month RIM made BES 10 available for enterprise and government customers to download, but questions remain about how RIM's service business will change with the introduction of BlackBerry 10 and BES 10. Last month, when it announced its fiscal third-quarter results, RIM said it would take a tiered approach to charging for its BlackBerry services--such as mobile device management, security and other services that use its proprietary messaging network--when it launches BlackBerry 10.

RIM is also hoping to come out of the gate strong with a wide range of apps and entertainment options to appeal to consumers. One of the main criticisms of the company's legacy BlackBerry platform was a lack of apps and developer support. BlackBerry 10 will launch with at more than 70,000 apps. Alec Saunders, RIM's vice president of developer relations, has spent more than a year traveling around the world wooing developers to BlackBerry and getting them to port their apps over. RIM CMO Frank Boulben said by the time the devices launch in the U.S. there will be 100,000 apps available on the platform. Click here for details on RIM's mobile content efforts.

Earlier this week RIM announced a list of multimedia partners that will supply music, film and television content for its overhauled BlackBerry World storefront. In addition to mobile applications and games, BlackBerry World (formerly BlackBerry App World) will now feature premium video downloads and rentals from Hollywood studios and independents including 20th Century Fox, Lionsgate, MGM, Paramount Pictures, Sony Pictures Home Entertainment, Walt Disney Studios and Warner Bros. Consumers will also enjoy access to television programming from the likes of ABC Studios, BBC Worldwide, CBC/Radio-Canada, CBS, NBCUniversal and Univision Communications. RIM said most feature films will reach BlackBerry World the same day they are released on home video, with many current TV series touting next-day availability. At launch, video content will be limited to the U.S., UK and Canadian markets.

RIM clearly faces challenges in getting both its existing subscribers to upgrade to BB10 and also attracting non-BlackBerry users, especially first-time smartphone buyers, a challenge also facing Microsoft's (NASDAQ:MSFT) Windows Phone platform. "In developed markets, BlackBerry is no longer perceived as a premium brand and subscribers in these regions have deserted the platform in their masses due to the lack of attractive devices," Informa Telecoms & Media analyst Malik Saadi said. "In 2012, the company sold fewer than 14 million BlackBerry phones in Western Europe and North America combined. However, RIM could well win these users back if it can offer them a premium user experience in line with the quality of its services, notably its BBM messaging platform and its e-mail services. And this is exactly what RIM is trying to achieve with the introduction of the BB10 platform."

RIM CEO Thorsten Heins  Alicia Keys .

RIM CEO Thorsten Heins introduces Alicia Keys as the company's new global creative director.

Saadi said RIM should aim to sell at least 1 million units of its new devices in the first quarter after its launch, and anything below that would throw into doubt the company's marketing strategy. He said that "anything above 3 million units would be a spectacular performance, which will undoubtedly resurrect both the consumers' and the investors' confidence in the BlackBerry brand."

Interestingly, Heins said music artist Alicia Keys will be joining the company as its new global creative director to evangelize BlackBerry 10 with consumers, app developers, retailers and carriers. She said that artists and entertainers are going to use BB10 phones in RIM's "Keep Moving Project" to connect with their audiences; RIM will document all of these efforts.

For more:
- see FierceMobileContent's take
- see this BlackBerry blog
- see this WSJ article (sub. req.)
- see this separate WSJ article (sub. req.)
- see this NYT article

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