So with the release of the Research In Motion Ltd (NASDAQ:BBRY) BlackBerry Z10 and Blackberry Q10, is it time for investors to start dong the Harlem Shake? I mean, Research In Motion Ltd (NASDAQ:BBRY) BlackBerry investors should start cranking up the music as the party has just begun, right?
Let’s start with the good
Many technology critics find the new Research In Motion Ltd (NASDAQ:BBRY) BlackBerry devices to be competitive with the Samsung Galaxy S series of phones. The company’s product uses touch navigation fairly well, and the user interface is familiar enough to a traditional BlackBerry user to make it worthwhile to transfer over.
The new BlackBerry Q10 comes with a QWERTY keyboard, hence the Q in front of the 10. It seems that Research In Motion Ltd (NASDAQ:BBRY) BlackBerry has adopted a touch screen/QWERTY input experience. The reasons for doing this are strong as it helps to keep BlackBerry from alienating traditional BlackBerry users who have gotten accustomed to the BlackBerry keyboard. I also have to admit that I am impressed that BlackBerry has been able to attract enough support from application developers, despite the overwhelming competition from the likes of Google Inc (NASDAQ:GOOG) and Apple Inc. (NASDAQ:AAPL).
The BlackBerry Z10 is a touch screen device that looks awfully reminiscent of the HTC One. The only difference is that the BlackBerry Z10 uses the BlackBerry operating system. It comes with a dual-core processor, versus the quad-core processor that the Samsung Galaxy S4 and the HTC One have. The BlackBerry Z10 falls behind in other areas like the camera, along with the number of applications that its Android counterparts have.
The new phone has been able to set sales record for Research In Motion Ltd (NASDAQ:BBRY) BlackBerry. However, the company has some key issues that it needs to address.
BlackBerry has been spending less and less on selling, general, and administrative expenses. The exact breakdown on how much money the company spends on advertising is unclear.
But one thing is for certain: falling advertising expenditure is not good, especially not for a product refresh that is as vital to BlackBerry as it was for Samsung to transition into high-end smart phones. When Samsung first launched its flagship Galaxy Series the company spent a lot of money on it.
It seems that Apple Inc. (NASDAQ:AAPL) has been spending an increasingly larger amount of money on its advertising. Apple uses many methods to get in front of consumers, which include standard press releases, one-to-one selling at Apple retail locations, media advertisements, print advertising, etc. The company has increased its spending by $2 billion in the same period that BlackBerry has cut back by around $500 million. This is dreadful news for BlackBerry shareholders. The company has cut its advertising spend during a product refresh cycle, which may mean that BlackBerry under-funded its next-generation product release.
Apple’s advertising spending seems to be working as the company has been able to log a 2.7% increase in its market share when compared to Google Inc (NASDAQ:GOOG)’s Android’s 1.4% decline, BlackBerry’s 1.2% decline, and Symbian’s .01% decline. Apple was able to steal market share away from the likes of Samsung, which only saw a gain in market share of 0.7% versus Apple’s gain of 2.7%.
Microsoft Corporation (NASDAQ:MSFT) is another contender in the space. With its new Windows 8 operating system coming into the mix, consumers will find it easier to readjust to a Windows 8 phone as the Windows 8 phone is going to be the same as the Windows 8 OS for desktop computers and Laptops.
Contrary to popular belief, the Windows 8 operating system has a lot of spunk. The developer team has done an excellent job of designing a user-friendly experience. In fact, I found that the Windows OS was easier to use than the Google Android for Samsung Galaxy Tablets. The Windows 8 uses a lot less in terms of system resources allowing for less screen tearing and shorter load speeds even with the same internet connection.
Microsoft Corporation (NASDAQ:MSFT) has been in the business of creating operating systems for quite a while. Microsoft will experience added gains in market share in the space as consumers become more accustomed to Windows 8. In the past year alone, Microsoft has increased its advertising spending by $300 million. The increases in advertising were probably driven by the need to spread positive press about its new Windows 8 product line-up, and generate some buzz for the mobile operating system.
I believe that BlackBerry, while creating a compelling phone, came up short in terms of timing. Just 3 months after the release of the next generation Blackberry, both Samsung and HTC already came onto the market with their next gen phones.
One thing Asian phone developers are extremely well-known for are faster product cycles. The consumers will be comparing a Samsung Galaxy S4 to a BlackBerry Z10. The difference between the two devices from a strictly hardware standpoint would put Samsung well-ahead of BlackBerry.
During a period of declining market share BlackBerry has cut back on advertising. This can only worsen its market position going forward, which is already reflected in the data.
The article BlackBerry: Is It Time To Do The Harlem Shake? originally appeared on Fool.com and is written by Alexander Cho.
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