BlackBerry Maker Pushes For Mainstream

More than 80% of Research In Motion's new customers last quarter were non-enterprise users who chose Blackberry smartphones over Apple, Palm, and others.

Marin Perez, Contributor

September 25, 2009

2 Min Read

Research In Motion's smartphones continue to gain mainstream footing with the addition of 3.8 million new BlackBerry users during its second quarter.

Once the exclusive domain of mobile professionals, RIM said more than 80% of its new subscribers were non-enterprise users. The company still maintains a dominant position in the enterprise mobility market thanks to its push e-mail and BlackBerry Enterprise Server, but it has been focusing more on the mainstream market with devices such as the low-cost BlackBerry Curve 8520, the touch-screen BlackBerry Storm. The company recently launched an application store and social network.

"As we head into the third quarter we look forward to gaining traction with BlackBerry services in new market segments to drive the next leg of growth for the company," said co-CEO Jim Balsillie during a conference call Thursday. "We are teed up to go much more mainstream."

Revenue for the second quarter was $3.53 billion, a 37% increase from the same period last year. The company shipped about 8.3 million devices for the quarter, but it did see net income dip slightly to $475 million compared to $495 million for same quarter a year ago.

The company expects to ship between 9.2 million and 9.9 million BlackBerry smartphones next quarter, as it prepares for follow-ups to popular devices such as the Storm and Bold. But some analysts expressed concern over its push to the mainstream because it would mean that RIM would be competing more directly with its consumer-friendly rivals.

"RIM is unlikely to maintain its over 50% share in North America in the face of increasing competition from Apple, Motorola, and Palm, among others," Goldman Sachs analyst Simona Jankowski wrote in a research note to clients.

The Google-backed Android operating system may also cause some problems for RIM because it is expected to power a variety of low-cost smartphones aimed at mainstream users. Motorola recently introduced the Android-powered Cliq, and Google expects up to 20 smartphones to be released by the end of the year from the likes of HTC, Asus-Garmin, and Sony Ericsson.

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