BlackBerry shares slide as new devices face uphill battle

Thu Jan 31, 2013 1:52pm EST
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By Euan Rocha

NEW YORK (Reuters) - The afterglow of Research In Motion Ltd's BlackBerry 10 unveiling faded on Thursday as a flurry of lukewarm reviews signaled the company's struggle to regain momentum in the hyper-competitive smartphone market was just beginning.

Shares of BlackBerry, RIM's new corporate name, fell almost 10 percent early on Thursday, after a 12 percent decline the previous day, as some tech analysts questioned whether the new BB10 devices the company launched on Wednesday were the sure-fire hit that BlackBerry needs to get back into the game.

While New York Times reviewer David Pogue gushed that BlackBerry's new Z10 model is "lovely, fast and efficient, bristling with fresh, useful ideas," other reviewers were more tentative in their appraisals.

"The problem with the Z10 is that it doesn't necessarily do anything better than any of its competition," said Joshua Topolsky of technology news website the Verge. "No one could argue that there's a 'killer app' here. Something that makes you want or need this phone because it can do what no other phone can do. That's not the case."

Such lukewarm reviews - combined with disappointment around a later-than-expected and still unspecified date for the U.S. sales debut - spooked investors and prompted analysts to cut their price targets and forecasts.

BlackBerry, which is making a big push to win back the all-important U.S. market with a Super Bowl ad this weekend, said the new Z10 touch-screen device would not go on sale in the United States until sometime in mid-March, saying U.S. carriers need more time to test the model.

"The shine from the Super Bowl ad will be a fading memory by the time U.S. customers can buy in March," said TD Securities analyst Scott Penner, who has a "hold" rating on the stock.

Samsung Electronics Co may also steal some of BlackBerry's thunder as buzz around its Galaxy IV device heats up before the Z10 hits U.S. store shelves, Penner pointed out.   Continued...

Ben Stephens (R), a Blackberry sales manager demonstrates a new Blackberry Z10 to prospective customer Shevek (C), as store manager Alejandra Escobar watches at a branch of UK retailer Phones 4U in central London, January 31, 2013. Blackberry's new Z10 model went on sale in the UK today. Research In Motion Ltd's glitzy unveiling of the long-delayed line of BlackBerry smartphones on Wednesday and a new corporate name failed to impress Wall Street analysts, with at least three downgrading the company's stock. REUTERS/Andrew Winning