I was just reading a post over in Seeking Alpha by Carl Howe about how the iPhone will sour RIM’s consumer BlackBerry results, and, although I disagree with many of Carl’s points, it is a very good post.
I don’t think RIM can articulate why consumers should buy their phones And when faced with a choice between Apple’s iPhone and RIM’s Blackberry, consumers will increasingly choose Apple, not RIM
Carl came up with four reasons why he feels this way:
- RIM sold only 2.5 times as many phones as Apple, a company that had never sold a phone before.
- RIM sold through 325 carriers, Apple through one.
- RIM has overestimated its ability to connect with consumers.
- RIM has spread itself too thin.
He goes on to explain in detail why each of these points will put a damper on RIM’s run at the consumer market, however, I believe that one of his Carl’s points and one of my own, tell a bit of a different story.
First lets go to point number 2.
RIM sold through 325 carriers, Apple through one.
Carl sees this as a minus, however, I see it as a huge, huge plus for RIM. Of the 1.25 million iPhones sold thus far, I would gather that 3/4 of them went to the fanboys that would have bought the device regardless of the network.
The average consumer, on the other hand, isn’t going to be so quick to switch carriers especially when they may have family plans on other carriers and would have to pay hefty EFTs to switch to AT&T on top have having to pay full price for iPhone, as AT&T doesn’t subsidize the cost at all.
The cost of the iPhone bring us to my point:
The iPhone, even after a $200 price cut, is still really expensive.At worst, the up front cost of a BlackBerry will be half that of the iPhone. Additionally, you don’t have to switch to AT&T to get one unless you want to so you don’t have to worry about EFTs.
At best, you can get a BlackBerry online through a third party like Amazon for practically free. Heck we’ve seen cash back for BlackBerry Pearls.
There is no doubt that the iPhone has changed the US mobile industry forever and Apple will make money hand over first with it, however, until AT&T subsidizes the cost and Apple opens the iPhone up to more carriers, RIM has great opportunity in the consumer market if they are smart about things.