RIM Loses Canada To Apple

So much for hometown loyalty: Canadian businesses are increasingly trading their Research In Motion BlackBerrys for Apple iPhones.
The Future Of RIM: Exclusive Research
The Future Of RIM: Exclusive Research
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Apple sold 2.85 million iPhones in Canada during 2011, according to data compiled by IDC and Bloomberg. In comparison, Research In Motion, which is headquartered in Waterloo, Ontario, sold 2.08 million BlackBerrys. This means Canadians now prefer the iPhone to home-grown BlackBerrys.

Looking at sales figures from 2010, IDC and Bloomberg point out that RIM still managed to beat Apple in Canada by a healthy 500,000 devices. In 2008, RIM's BlackBerrys outsold Apple's iPhone approximately five-to-one. (Android didn't launch until late 2008.)

RIM must be feeling like Nokia felt a year ago, when Android devices outsold its Symbian smartphones in its home market of Finland. To lose the upper hand on your home turf has to sting--not that RIM's position in the market is surprising.

[ RIM has its work cut out for it. A recent J.D. Powers survey places the company at the bottom of the list in overall customer satisfaction. Nokia, RIM Rank Lowest In Smartphone Satisfaction. ]

RIM's share of the smartphone market has been sinking for years, as first the iPhone and later Android coaxed crackberry addicts to switch platforms. RIM has struggled against Apple and Google, with its market share in the U.S. now at half of Apple's and one-third of Google's. Consumers prefer the large touchscreen devices to RIM's QWERTY keyboard-equipped messaging devices.

The timing of this market shift in Canada isn't great for RIM. The company's BlackBerry World conference is scheduled to kick off the first week of May. This lost home market advantage will likely dampen the spirits of a company that's been beaten up pretty thoroughly over the last few years.

"For RIM, in its home market, to lose that No. 1 position to iPhone is strategically important," said Paul Taylor, a fund manager at BMO Harris Private Banking, to Bloomberg. "The challenge for Mr. Heins [RIM's new CEO] is to take that iconic brand and products that are reasonably competitive and ensure that they do get appropriate attention from the average consumer. That's the challenge: to reverse the negative sentiment that has developed."

Thorsten Heins took the reins of the company from former co-CEOs Mike Lazaridis and Jim Balsillie in January. The two stepped down after the company's PlayBook tablet and BlackBerry 7 smartphones failed to gain traction against Apple and Google.

The company is in the midst of a transition between the BB7 and QNX/BB10 platforms. Until it gets new handsets to the market, it will continue to lose market share. Purveyors of Android phones show no sign of slowing down the continual onslaught of new smartphones.

RIM needs time to get back on its feet, but time is something the company can't afford to waste.

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