BlackBerry Ltd (NASDAQ:BBRY) (TSE:BB) has announced that it will stay true to form and completely misread the mobile phone market, this time by pricing its first budget phone, the BlackBerry 9720, at $280, instead of the sub-$100 price tag it probably needed to be a hit. The problem isn’t the phone itself, which is fine for the budget market, but customers can get just as much phone for significantly less or pay a bit more to jump into an entirely new category, explains Tero Kuittinen at Forbes.
The BlackBerry 9720 has an antiquated OS and a 2.7 inch screen. It’s basically the least you can offer someone and still call it a smartphone, but that’s actually not a terrible idea. There are plenty of people who would love an iPhone or Android but can’t justify the expense. That’s why Nokia Corporation (NYSE:NOK) (BIT:NOK1V) (HEL:NOK1V) released the Asha 501, a smartphone with a comparably small screen and old operating system. But the Asha 501 goes for $100 or less, sometimes as little as $80. So BlackBerry’s offer is that consumers can spend 450 percent more, get a slightly smaller screen, but enjoy the prestige of having the word BlackBerry Ltd (NASDAQ:BBRY) (TSE:BB) on their phone.
BlackBerry puts premium price tag on budget quality phone
It’s about to get worse. Details are scarce at this point, but most people expect the iPhone 5C to be a budget phone debuting at under $400. If it ends up being significantly less, say around $320, then it’s hard to imagine someone choosing an outdated BlackBerry over the newest iPhone to save forty bucks.
This comes after what has already been a terrible year, even for BlackBerry Ltd (NASDAQ:BBRY) (TSE:BB). The Q10 and Z10 models that were supposed to reinvigorate the brand hardly made a dent in the market and their new mobile OS hasn’t seen any use because no one wants own a BlackBerry Ltd (NASDAQ:BBRY) (TSE:BB). They’ve tried everything from slashing prices on those two new models, pushing their brand in India, and giving other platforms access to their BBM service, but none of it has given them traction.
The most recent rumors, that BlackBerry is up for sale, still seem like the most probable conclusion. At some point there’s no overcoming a tarnished brand name, and continued mistakes like this one aren’t going to help.