BlackBerry Sales Hit by Fears Over Company's Future

Monday, September 2, 2013

BlackBerry sales hit by fears over company's future | Firm's money woes seem to be worrying clients like Morgan Stanley, which has delayed upgrade to latest model.

Issues that struggling smartphone company BlackBerry can not survive in its present kind appear to be hurting sales of its new phones, each to businesses and retail customers.

Investment bank Morgan Stanley is delaying a multimillion pound contract to upgrade to BlackBerry's latest smartphones amid considerations the company can not survive, in line with the Bloomberg wire service, that quoted internal sources.

Meanwhile, trade sources within the UK say the new phones – the touchscreen Z10, introduced in January, and keyboard-primarily based Q10, that went on sale in April – "haven't specifically flown off the shelves". Within the US, the Wall Street Journal reported that carrier executives and US retailers referred to as sales of the Q10 "dismal", with one multi-store owner seeing nearly no demand.

The revelations return simply weeks when the corporate announced it had place itself up for sale as half of a decision to "explore strategic choices".

Morgan Stanley, with fifty five,600 staff, is sticking with its existing handsets using the older BB7 software from 2011, Bloomberg said, and has not created any strategic plans to upgrade despite their age.

BlackBerry phones are popular within monetary and government organisations as a result of of the encryption applied to data, as well as email metadata, and their physical keyboard. Some Canadian banks are testing BB10 phones, as well as Royal Bank of Canada in the corporate's home country. The Pentagon has also cleared the phones for use on its internal network.

But growing considerations that it might hit a money crunch or that carriers will decline to sell its phones – together with growing downward pressure on the value it can charge for its services – has led some businesses to hold aloof from sizable purchases.

"Tech could be a confidence game," said Douglas Pollitt, who runs the freelance brokerage firm Pollitt & Co, which holds BlackBerry stock. "If there is no confidence in the company, the corporate won't sell gear."

BlackBerry is simply finishing its fiscal quarter, which ends on 31 August, and will report on twenty seven September. Chief government Thorsten Heins forecast in June that the company would create an operating loss within the quarter, following on from a internet loss of $80m last time on sales of $3.1bn.

He also revealed that it had shipped just 2.7m BB10 phones in that period, out of 6.8m total, as handset shipments slumped from a high in late 2011 of 14.9m.

The Q10 made a robust begin within the UK when it was sold completely through Selfridges, with thousands being snapped up at intervals hours by business customers, in some cases for immediate export to the Middle East.

But some customers have since suffered software problems with the handset, resulting in returns in some cases.

The corporate is trying to remake itself as a software and services company and is getting ready to broaden its BlackBerry Messaging (BBM) service, previously exclusive to its own phones, to Apple's iPhone and handsets running Google's Android software.

A Morgan Stanley spokesperson declined to investigate the report.

A BlackBerry spokesperson said:

"We have a tendency to do not escape specific device numbers, just a complete overall figure we disclose in our quarterly earnings. In terms of the below Bloomberg report, we tend to do not comment on rumour or speculation."

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