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BlackBerry’s best hope said to be as a ‘niche player’ going forward

Published Mar 27th, 2013 10:17AM EDT
BlackBerry Market Share

A full-blown instant comeback was never in the cards for BlackBerry (BBRY), and now one analyst thinks the company’s best hope is to shoot for being a niche player going forward. Per StreetInsider, BGC Partners analyst Colin W. Gillis projects that “at best” BlackBerry “becomes a niche player” that has a small but very loyal group of customers that will help it survive the annual onslaught of new devices from big-name players such as Apple (AAPL) and Samsung (005930). But Gillis warns that this is only a best-case scenario and that BlackBerry still has a lot of potential pitfalls ahead, particularly in its efforts to retain customers in emerging markets.

Gillis takes particular issue with the company’s current strategy of trying to hold its ground in the high-end market with its first BlackBerry 10 devices while seemingly giving less priority to new low-end devices in emerging markets.

“The other major market participants are actively positioning for growth to shift to the mid and entry level segments of the market just as Blackberry is renewing its pursuit of the high end,” Gillis explains. “The pricing for the Z10 in the U.S. at $199 with a two year contract — parity pricing with the top brand name model — seems a poor value proposition to a user who is being asked to take a risk with a new operating system.”

BlackBerry will report its quarterly earnings tomorrow. The current Street consensus is for the company to post a -$0.39 EPS on revenues of $2.84 billion.

Brad Reed
Brad Reed Staff Writer

Brad Reed has written about technology for over eight years at and Network World. Prior to that, he wrote freelance stories for political publications such as AlterNet and the American Prospect. He has a Master's Degree in Business and Economics Journalism from Boston University.