At These Prices, Fortune Doesn�t Favor RIM�s BlackBerry Bold

At These Prices, Fortune Doesn�t Favor RIM�s BlackBerry Bold
By Tom Krazit --- mocoNews.net --- Aug 17, 2011 2:13 PM ET

Research in Motion�s curious �let�s make our declining brand $100 more expensive than our more-popular competitors� strategy for the launch of its new BlackBerry models is not going to win it any fans in the store aisles or on Wall Street. Even die-hard BlackBerry fans might do a double-take at what they are being asked to pay for the new BlackBerry 7 devices as compared to their other options for high-end smartphones.

When a company doesn�t reveal pricing in a press release, it�s an easy sign that something isn�t right. T-Mobile proudly announced that it would offer the BlackBerry Bold 9900 as part of a presale for its business customers starting today, with general availability coming at the end of August. However, you had to wander over to T-Mobile�s Facebook page to find out that the phone would cost $299 after a $50 mail-in rebate.

Simply put, that�s way too expensive for a phone that isn�t all that different from older BlackBerry models that haven�t been selling well even with lower prices. Reviews of the Bold 9900 have described it as a great BlackBerry device but still unable to match the Web browsing and application experiences offered by the iPhone and high-end Android devices.

The pricing strategy is even more bizarre given comments earlier this year from RIM (NSDQ: RIMM) co-CEO Mike Lazaridis, who in June described the forthcoming BlackBerry 7 devices as best suited for �lower-cost� markets �where cost is premium.�

The sweet spot for smartphone pricing these days is $199, and RIM and T-Mobile aren�t even coming close to that with the Bold 9900. Sprint (NYSE: S) and Verizon plan to carry basically the same phone for $249, which isn�t very aggressive either but is at least in the ballpark. Apple (NSDQ: AAPL) sells an iPhone 4G with 16GBs of storage for $199, and a 32GB-model for $299, as compared to the 8GB of storage available on the Bold 9900. A few Android models cost more than $199, but most fall into that category and an awful lot of them can be had for free with a two-year contract on any given day. And one could make a reasonable argument that the $49 iPhone 3GS, which is more than two years old at this point, is still a better investment than a $249 BlackBerry 7 device.

This is not entirely RIM�s fault. Wireless carriers ultimately determine the price of a phone by how much they are willing to subsidize its cost, locking customers into a two-year contract in order to make their money on data revenue. But RIM can help carriers by accepting less margin in order to help the end price reach a certain level.

That is, unless RIM is unable to lower its acceptable margin because it is scrambling to reach already-lowered full-year profit goals. The company is under an enormous amount of pressure to turn its fortunes around following sliding sales of its smartphones in the U.S. and the declining profits that accompany such a skid.

Which puts RIM in the proverbial rock/hard place sandwich: it probably won�t lure new customers to the BlackBerry with such high pricing, and it may turn off a few long-time fans. But if it lowers its prices to goose volume, it won�t hit those profit targets and investors will be very unhappy.

The new BlackBerry Torch models unveiled earlier this month will likely come with cheaper price tags and two other BlackBerry 7 devices are expected this year, but the Bold is the flagship product. With Apple almost guaranteed to offer an iPhone 5 at $199 and new Android models also expected around the release of the Ice Cream Sandwich version this fall, the competition is not going to get any easier for RIM.

At These Prices, Fortune Doesn�t Favor RIM�s BlackBerry Bold | mocoNews

Prices will come down.

prices will go down..
and i'm not the only one here who thinks like that.

Yeah, prices will go down sooner than anyone thinks. I believe the carriers have the
biggest influence on the subsidized pricing. I'll defend RIM on this one. I think the
full retail price is fair.

When the Bold 9000 released, was it also priced pretty high? I kind of only remember the No Commitment pricing. Also, the same for the 9700. It spend forever at $349 (on AT&T), but then would shoot up to almost $600. I don't remember the pricing on contract for either on release though. Also, I understand the past pricing probably has no significance since the smartphone market has changed considerably.

Posted from my CrackBerry at wapforums.crackberry.com

The pricing strategy is even more bizarre given comments earlier this year from RIM (NSDQ: RIMM) co-CEO Mike Lazaridis, who in June described the forthcoming BlackBerry 7 devices as best suited for �lower-cost� markets �where cost is premium.�

from the OP article...

-------------------------------------------------------------------

more press coming out...

"I would describe that charitably as insane," said Avi Greengart, who covers consumer electronic products for Current Analysis.

BlackBerry price tag: Bold, or bordering on crazy? - CBS News

Originally Posted by Amy wineBerry

When the Bold 9000 released, was it also priced pretty high? I kind of only remember the No Commitment pricing. Also, the same for the 9700. It spend forever at $349 (on AT&T), but then would shoot up to almost $600. I don't remember the pricing on contract for either on release though. Also, I understand the past pricing probably has no significance since the smartphone market has changed considerably.

Posted from my CrackBerry at wapforums.crackberry.com

The Bold 9000 was at $300 on AT&T. I remember I ended up getting it at $200
when I had them on the phone with the retention's department threatening to cancel.

Originally Posted by FigureThisOut

The Bold 9000 was at $300 on AT&T. I remember I ended up getting it at $200
when I had them on the phone with the retention's department threatening to cancel.

How is this marketing strategy, pricing ploy, going to win over new customers? It looks like those responsible are out of touch with the consumer/customer... and it opens them up to a slew of bad press... l

Originally Posted by Buzz_Dengue

How is this maketing strategy, pricing ploy, going to win over new customers? It looks like those responsible are out of touch with the consumer/customer... and it opens them up to a slew of bad press... l

I just think the carriers are going to milk whatever they can from the customers
before eventually dropping the price. That's pretty much what it's all about. The
carriers.

I think all handsets are over priced, they always have been and always will be, it is what it is, I remember paying $350+ for a Moto Razr back in the day. Welcome to the mobile industry. $199 for my 9930 is what I expected. Also, has anyone seen the prices lately for "basic" cell phones? :eek:

Prices have always been somewhat outrageous...
I remember in '08 a RAZR2 was 499

The storm was 599 when it came out....
I'm just glad Telus has a great retention dept.

Originally Posted by Amy wineBerry

When the Bold 9000 released, was it also priced pretty high? I kind of only remember the No Commitment pricing. Also, the same for the 9700. It spend forever at $349 (on AT&T), but then would shoot up to almost $600. I don't remember the pricing on contract for either on release though. Also, I understand the past pricing probably has no significance since the smartphone market has changed considerably.

Posted from my CrackBerry at wapforums.crackberry.com

I paid $50 for my 9700 about 18 months ago.

i remember paying approx $500 for my Samsung SPH-A900 (the Blade) with no contract, so $500 or so for a Bold 9900 doesnt shock me, or make me even THINK of switching to iphone or android.

So it is RIM's fault that carriers subsidize the iPhone more than any other phone? iPhone 4 16GB MSRP $649, 32GB $749. So carrier is subsidizing $449 for iPhone. RIM's MSRP is $599 for the Bold and carriers are subsidizing less so it costs consumer more. Not RIM's fault, carriers fault. Only carriers giving RIM a good break is AT&T if the Torch2 pricing is $49 on contract, and Sprint Pricing the 9850 at $149. And I don't think RIM should lower their prices, that SOC is used in plenty of high-end phones.

I don't think this is fair to blame RIM for the carrier pricing. This is really irresponsible journalism.

I think it's only fair to compare off contract pricing of which the bold 9900 is very reasonably priced at 500 dollars compared to the 650 iphone 4 which is a year old. There are plenty of android phones that are well over 500 dollars as well.

"And one could make a reasonable argument that the $49 iPhone 3GS, which is more than two years old at this point, is still a better investment than a $249 BlackBerry 7 device."

^is that a joke? These journalist/media types are crazy to me.

anyone know if and when it will come to costco? i vowed to never buy a handset from verizon directly after i paid 250 for my droid pro and found it for 20$ at costco 2 weeks later. i assume if they carry it they will knock off a nice chunk of the price tag, it sure is gettin hard to keep waiting tho..

mocoNews.net? Never heard of them...nuff said.