Research In Motion (RIM) is expected to release its much anticipated, 3G smartphone, the BlackBerry Bold, in North America within the coming weeks, but the steep price tag tied to the new device just may come as a surprise to many of the folks eagerly awaiting its release.
Not me, though…and here’s why.
The BlackBerry Bold is already shipping in some countries, including Australia, Austria, Germany and Turkey, mostly to business customers, so pricing specifics are sparse.
The new RIM smartphone isn’t officially available anywhere in North America, though rumors and other details regarding pricing are bouncing around the Web.
In fact, just last week a leaked document from Canadian carrier Rogers hit the Web, bringing the news that the Rogers BlackBerry Bold will retail for $399 along with a three-year contract. Rogers is expected to begin selling the device later this month.
Rogers has traditionally priced its BlackBerry devices a bit higher than its U.S. peers, but the official Bold price came as a shock to a lot of BlackBerry loyalists and smartphone watchers, many of whom had expected a significantly lower price due to the fact the Bold-rival iPhone 3G 8GB sells for half that price along with a two-year AT&T contract. (The 16GB iPhone 3G is also cheaper, at just $299 with a two-year contract.)
Some bloggers even played on the Canadian carrier’s name, affectionately dubbing the company “Robbers.”
When I first heard that Rogers planned to charge $399 for the Bold along with a three-year contract, I couldn’t help but laugh.
That’s a lot of money-enough to keep me from upgrading if I was a Rogers customer.
Then, because I have quite a few BlackBerry-addicted associates north of the U.S. border who are Rogers subscribers, I started to feel sorry for them, not only because $400 is very pricey for a new smartphone, but also because they’ll need to sign a new three-year contract instead of just the two-year commitment that most U.S. carriers require.
(T-Mobile Germany subscribers are paying what amounts to just under US$200, as well, so Rogers’s pricing seems all the more steep.)
But then, the more I thought about Rogers’ pricing decision, the more it began to make sense — and the more sure I became that AT&T will indeed release the device with a similar price tag, though I can’t see the U.S. carrier requiring more than a two-year service contract.
Right now, RIM is trying to find a balance between catering to its traditional customer base, enterprises, and the newly-tapped consumer market. Over the past decade or so, RIM earned a reputation as a company that makes durable and reliable business devices, and it has blossomed into the smartphone giant it is today because of this.
RIM is slowly moving away from businesses and embracing consumers with new devices meant to meet their specific needs-though the Bold admittedly crosses into both territories. RIM needs to be careful not to alienate those same businesses that lifted it to its current stature in the smartphone world.
RIM’s number one concern must remain the business customer-at least until it more firmly plants its feet in the consumer market.
That means not only creating devices with enterprise-oriented features missing from rival offerings, but also continuing to create the BlackBerry mystique that has thus far set the smartphones apart.
Until last year, many BlackBerry users felt they were in some sort of exclusive club, because only specific groups of businesspeople or gadget geeks had them. Consumers didn’t need the BlackBerry’s impressive e-mail functionality.
And the high prices worked to dissuaded them from purchasing RIM products. Today, any Joe off the street with decent credit can walk into any major U.S. carrier’s retail stores and pick up a new BlackBerry Pearl for less than $100. And though that’s certainly a boon to RIM’s sales numbers, it’s slowly diluting the BlackBerry reputation.
Businesspeople don’t want to be using the same mobile devices as their children or the local teenagers, and RIM, Rogers, AT&T and all the other major global carriers know this. The BlackBerry Bold is now RIM’s flagship business device, and in addition to business-specific features, it’s going to have an executive-level price tag.
I can’t help but draw a comparison from the automobile world: Today, the BMW is very much a status symbol and even though companies like Acura and Audi offer sleek, attractive vehicles that are cheaper than BMW’s entry level 3 Series, folks with the money-or who want to portray the image of having money-will inevitably purchase the more expensive BMW.
The BlackBerry Bold will be a status symbol, and you’re going to have to pay a premium for it. If you can’t afford it, or want to gripe about the price, Rogers, T-Mobile or any other carrier that offers RIM products will gladly sell you a consumer-minded BlackBerry Pearl today, or further down the line, the as-of-yet unreleased BlackBerry KickStart/Pearl 8220; the Curve successor, the “Javelin;” or, perhaps, the BlackBerry 9220–the feature-packed gadget that’s just come to light.
So, to wrap this all up, I’ll predict that AT&T will begin selling the BlackBerry Bold in mid-September for $350 and a two-year service commitment.
(It’s worth noting that when I asked RIM about Bold pricing at the company’s Wireless Enterprise Symposium last May, I was told between $300 and $400.)
The extra $50 will likely send more than a few new smartphone buyers the way of the iPhone 3G, but that should be just fine with RIM, since over the next year or so, it will be releasing its new fleet of smartphones to compete directly with Apple’s uber popular device, and some will reportedly retail for as low as $49.99.
What’s your take on the Bold sales strategy? Is $399 and a three-year contract excessive, even if your company’s footing the bill?
