Analyst: BlackBerry should stick to low-end phones15
Blair points out that the low end is where the growth is at, and looking at how well the entry-level Nokia Lumia 520 and Nokia Lumia 521 did this year, there might be some truth to that comment. The Lumia 520 became the best selling Windows Phone handset in 2013, and the analyst sees BlackBerry successfully selling over 100 million units if it follows his plan. So what is the plan? Blair wants BlackBerry to stop producing high-end and even mid-range devices, and focus on manufacturing low-end phones for the emerging markets.
The analyst also notes in his open letter that BlackBerry should give up trying to compete with its software. There are three big tech giants in Apple ( iOS), Google (Android) and Microsoft (Windows Phone), each one able to throw unlimited amounts of money into OS development. BlackBerry needs to give up a battle it cannot win and to prove this, Blair points out that BlackBerry has been unable to attract enough developers to produce enough apps for BlackBerry World. That alone should be a signal that it is time for a change.
As a suggestion, Blair says that BlackBerry should offer BlackBerry 10 models priced at $99-$199 without a subsidy. Aiming for a 25% gross margin at that price, the analyst suggests that BlackBerry combine the QWERY-equipped BlackBerry Q5 with the futuristic looking Porsche Design BlackBerry P'9982. In his open letter, Blair says that, "BB10 in a $149 sleek Porsche-designed Q5-like device could be your 2014 breakthrough." He would like to see BlackBerry stick to offering the top 25 apps around the world and pay to get them developed if necessary.
Blair closes out the letter by suggesting that BlackBerry push BBM more and develop apps focused on emerging markets. To those who would point out that BlackBerry would be receiving less revenue per unit sold if it were to follow his game plan, the analyst says that this is the direction that the company is headed in anyway, even if it sticks with high-end models. Selling entry-level phones will allow BlackBerry to make it up in volume. The question is whether a company like BlackBerry, which has a history that it is immensely proud of, can move to the low-end of the smartphone market without feeling like a failure.