This Day On The Street
Continue to site
ADVERTISEMENT
This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here

If New BlackBerry Has No Buyers, Does It Exist?

NEW YORK ( TheStreet) -- BlackBerry's (BBRY - Get Report) new smartphone hit the street March 22 to little fanfare. AT&T (T - Get Report) didn't even put up signs or floor displays in several locations, including at least two stores in Manhattan.

The new Z10 smartphone was unveiled nearly two months ago and is just as much a technology upgrade as an operating system improvement. The new smartphone is supposed to be BlackBerry's answer to Apple's (AAPL - Get Report) iPhone and Google's (GOOG - Get Report) Android phones. The company is vying for third place, meaning its direct competitor is phones that run the Windows 8 operating system.

That's all well and good, but BlackBerry is taking serious chances with this -- and it chooses to drop the phone so shortly after Samsung launches its Galaxy S4. The new Galaxy is direct competition for Apple and Google -- what was BlackBerry thinking?


OK, let's take a look at BlackBerry for a second. The company's stock closed Monday at $14.23, down almost 5%. There are rumors that "an established partner" just ordered 1 million BlackBerrys, and speculation says it's Brightstar, a company whose business is distributing smartphones to retailers.

But the market doesn't seem encouraged. Goldman Sachs downgraded the company on Monday to "neutral" from "buy," and set a price target of $17.

There is always the question as to whether BlackBerry has the chops to make a new operating system work. The company had the lion's share of the early (business) smartphone market -- but that was then.

The BlackBerry brand fell out of favor as more people turned toward touch screens and phones that act more like personal assistants than telephones, and that trend has only accelerated. Late last year, the company lost 1 million customers in just one quarter, prompting a 48% drop in revenue in its fiscal third quarter.


BlackBerry still has some standing in government agencies, but even that is on the decline. In August 2009, more than 77% of federal managers carried a BlackBerry. By September 2011, that figure had dipped to less than 50%. In May 2012, National Oceanic and Atmospheric Administration program manager Stefan Leeb said his group was no longer buying BlackBerrys and that there was an intention in place for his agency to be off those systems by June 1. And NOAA isn't the only government agency with a change of heart.

1 of 2

Check Out Our Best Services for Investors

Action Alerts PLUS

Portfolio Manager Jim Cramer and Director of Research Jack Mohr reveal their investment tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
Quant Ratings

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
Stocks Under $10

David Peltier uncovers low dollar stocks with serious upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
14-Days Free
Only $9.95
14-Days Free
Submit an article to us!
SYM TRADE IT LAST %CHG
AAPL $128.95 0.00%
BBRY $10.27 0.00%
GOOG $537.90 0.00%
T $34.42 0.00%
FB $78.99 0.00%

Markets

DOW 18,024.06 +183.54 1.03%
S&P 500 2,108.29 +22.78 1.09%
NASDAQ 5,005.3910 +63.9670 1.29%

Partners Compare Online Brokers

Free Reports

Top Rated Stocks Top Rated Funds Top Rated ETFs