A New BlackBerry Craze May Be Blooming

NEW YORK (TheStreet) -- The bears on BlackBerry (BBRY:Nasdaq) are more than 95% American from what I've seen.

Their geographic location over the last three years has no doubt colored their views of the company. Just think, three years ago, BlackBerry had over 50% of the American market share of the smart phone market. An enviable position to be sure.

Today, BlackBerry has around a 3% share of the market in the U.S.

Another way of looking at it is that BlackBerry had 30 million subscribers in the U.S. three years ago and about 17 million today. But that's over a period when smart phone sales around the world have doubled. So BlackBerry -- if they were just growing with the market in the U.S. - today should have 60 million subs in the U.S.

If you're American and all the people around you every day are pulling out their Android or iPhones, you can't help but turn your nose up at players like BlackBerry and Nokia ( NOK) that you never really see. Even if analysts tell you that those two companies are still performing well overseas, you can't help but discount that information.

It doesn't help when the New York Times runs stories about cool people in Silicon Valley are embarrassed at being seen using their BlackBerries by their friends.

But let's put all this social stigma and geographic bias stuff to the side and really take a look at where BlackBerry sells its phones today and what that means for a successful roll-out of their new all-touch Z10 phone and, later, the keyboard Q10 in a few weeks.

The U.S. is still a huge smart phone market in the world and this is still the case for BlackBerry --even if its market share has plummeted in the U.S. in the last three years.

Even today -- selling 2-year-old and older terrible phones for the last little while -- 22% of BlackBerry's global subscribers come from the U.S. That's double the second-largest market for BlackBerry which is the UK coming in a 11%.

The next-biggest markets for BlackBerry are, surprisingly, Saudi Arabia at 7% and the UAE at 4%. Also at 4% market share are Canada, France, Spain and the Philippines. Then at 3% are countries like Argentina, Indonesia, and Italy. India is at 2%. Other notable countries are Australia, Nigeria, and South Africa. (All these data are estimated by Tom Astle at Byron Capital Markets.)

So why did BlackBerry do well Monday with the stock up 15%? I don't think it was the BlackBerry TV commercial in the Super Bowl (although I thought it was the right decision for them to spend $3 million or whatever it cost them to reach one-third of the people in their single largest market).

What I think was the real driver of the stock was news out of the UK over the weekend that the Z10 was selling out over there after going on sale last Thursday. It's still not clear exactly how much supply of the new phones different outlets received, but it's still surprising to many that these phones were selling well.

Today, the Z10 goes on sale in Canada. Next week, the phone will start selling in the Middle East.

Canada and the UK have traditionally been a stronghold for BlackBerry, capturing a lot of the banker/lawyer/corporate users. The Middle East (Saudi and the UAE) have obviously emerged in the last couple of years as very significant new markets for BlackBerry. Therefore, there's a good chance that, before the end of the month, we will continue to get a stream of good news trickling out of all these markets on how well the Z10 is doing.

Canada has remained in love with the BlackBerry, even if the rest of the world has moved on. CIBC analyst Todd Coupland released a survey Monday that suggested over half of pre-registration orders for Z10s to some Canadian carriers came from current Android and iPhone users. That's stunning if accurate, as no BlackBerry bears (and even some BlackBerry bulls like me) ever would have guessed that.

So, Monday's reports may just be part of a move that could last the next couple of weeks before there's a pullback.

Of course, we will still have to wait for accurate sales data from all these key markets. That could be a few more weeks away. And, of course, we'll get a more definite sense from the company on how the initial February push is going when they report earnings in March.

But, with the high share count still held short, a trickle of good news from these key markets, and the possibility of BlackBerry announcing pre-orders by some of their top carrier customers, it seems to me that reward outweighs risk for the next two weeks -- especially after the big selloff last week.

At the time of publication, the author was long BBRY.

This article is commentary by an independent contributor, separate from TheStreet's regular news coverage.

Eric Jackson is founder and Managing Member of Ironfire Capital and the general partner and investment manager of Ironfire Capital US Fund LP and Ironfire Capital International Fund, Ltd. In January 2007, Jackson started the world's first Internet-based campaign to increase shareholder value at Yahoo!, leading to a change in CEOs in 2007. He also spoke out in favor of Yahoo!'s accepting Microsoft's buyout offer in 2008. Global Proxy Watch named Jackson as one of its 10 "Stars" who positively influenced international corporate governance and shareowner value in 2007.

Prior to founding Ironfire Capital, Jackson was President and CEO of Jackson Leadership Systems, Inc., a leadership, strategy, and governance consulting firm. He completed his Ph.D. in the Management Department at the Columbia University Graduate School of Business in New York, with a specialization in Strategic Management and Corporate Governance, and holds a B.A. from McGill University.

He was previously Vice President of Strategy and Business Development at VoiceGenie Technologies, a software firm now owned by Alcatel-Lucent. In 2004, Jackson founded the Young Patrons' Circle at the Royal Ontario Museum in Toronto, which is now the second-largest social and philanthropic group of its kind in North America, raising $500,000 annually for the museum. You can follow Jackson on Twitter at www.twitter.com/ericjackson or @ericjackson.

You can contact Eric by emailing him at eric.jackson@thestreet.com.

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