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Storm sales seen tanking after holidays

updated 04:45 pm EST, Mon December 22, 2008

Needham on Storm post Xmas

Research in Motion is unlikely to sustain its early sales success for the BlackBerry Storm past the holidays, analyst Charlie Wolf of Needham Research estimates. The financial expert acknowledges that the Storm had a particularly strong launch but believes that the first touchscreen BlackBerry's sales will drop in early 2009 as a number of poor reviews damage its reputation beyond early adopters and holiday buyers. Other competitors have had also had more favorable reactions and are thought to stand a better chance of maintaining momentum and of avoiding early price drops.

"The competitive landscape in the consumer segment of the smartphone market has heated up significantly as reflected in the success of the iPhone and the imminent arrive [sic] of phones running on Google's Android operating system," Wolf writes. "This is taking a toll on RIM's gross margins. And it could lead to a deceleration in the growth of new subscriber activations in [2009]."

The Needham analyst doesn't provide specific guidance as to sales numbers for the Storm or other phones, though he notes the Bold may also be subject to a post-holiday lull.

RIM has presented only limited information about the Storm's performance since it went on sale. The company noted the Storm was responsible highest daily number of new BlackBerry service subscribers ever in its history but has yet to break down its 6.7 million shipped phones by model, making it difficult to determine how many were sold on launch and during the first week of availability recorded during the quarter.

About 50 percent of all Storm buyers are also new to the platform, though it's unclear how many of these are converts from opposing devices and carriers versus upgrades existing with Verizon or Vodafone. Approximately 40 percent of iPhone 3G buyers have switched from rivals and are most likely to have switched from Verizon.



By Electronista Staff
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Comments

  1. macbones

    Fresh-Faced Recruit

    Joined: Jul 2006

    +1

    Damaging reviews?

    Have you seen one? Held one? Tried to use one? I've got a couple of friends who jumped on early- just to have an alternative to the iPhone it seems, and they're so dissatisfied they have no problem wanting for an iPhone out loud. That things doesn't need reviews to damage itself. Damage is self inflicted- it is a POS!

  1. testudo

    Forum Regular

    Joined: Aug 2001

    -1

    Re: damaging reviews

    Maybe they wanted to have an alternative to the iPhone because they did not or could not switch to ATT for their phone service.

    Maybe if Apple could've offered several versions, ones that worked on various cell networks, they wouldn't have to try to find an alternative.

  1. cyn1c

    Fresh-Faced Recruit

    Joined: Oct 2008

    0

    Heh

    This is funny. EVERY review hammered the Storm as soon as it came out. According to rumor it has an incredibly high return rate... and yet RIM's stock exceeded expectations. But after Christmas, it will tank... definitely, according to the same analysts who were wrong before.

    Or maybe they will keep coming out with new phones and updates to improved the Storm's OS... and their stock will not go down.

    The iPhone is really pretty and slick, but it has some major issues just like all of the phones out there. And AT&T's service sucks hard in a lot of the country, whereas Verizon has excellent reception. Often the next best smartphone alternative is a Blackberry. Which is why people go with Verizon and are buying Storms. THis will keep happening until a better alternative comes out. Peopel would rather have a phone with some issues that they can use than have a pretty and slick one with no reception.

  1. wings_rfs

    Fresh-Faced Recruit

    Joined: Dec 2002

    +1

    Verizon = Excellent?

    " And AT&T's service sucks hard in a lot of the country, whereas Verizon has excellent reception."

    I'd say, Verizon's service sucks hard in a lot of the country, whereas AT&T has excellent reception.

    In fact, Verizon was so bad at my house (due to "call was lost"), they offered to let me out of my contract at no charge, and I live within one mile of their nearest tower.

    I'm now with AT&T with an iPhone and I have no such problems, so your blanket statement does not seem to apply here.

  1. Constable Odo

    Fresh-Faced Recruit

    Joined: Aug 2007

    0

    No smartphone on the

    market is perfect for every individual. There needs to be some alternative for people on different networks or that need different hardware features. The iPhone can't even do simple video recording, it doesn't have a flash or support Flash or standard copy/paste. I'm not saying that lacking these features is terrible, but if that's what a user wants, they should be able to have them if they're available on a competitor's handset. Company competition benefits the end user.

  1. cyn1c

    Fresh-Faced Recruit

    Joined: Oct 2008

    0

    AT&T = poor coverage

    Wings_rfs, I wasn't really looking to get into a pissing match between Verizon and AT&T. I was just trying to explain why the Storm is doing so well in spite of all the bad reviews.

    In case you missed the point of my post when your Apple/AT&T fanboi rage kicked it, I will reiterate it: The iPhone and AT&T does not work with everyone's lifestyle. The rest of us appreciate having other options.

    That said, please compare high speed data access coverage for AT&T and Verizon.

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