Research In Motion Ltd (NASDAQ:BBRY) (TSE:BB)’s BlackBerry Z10 is finding some enterprise success and it’s coming from German customers.
According to AllThingsD, the Federal Office for Information Security (BSI) of Germany approved a deal that has the government buying 5,000 BlackBerry Z10s. The devices, which will be used by employees, will include Secusmart technology for additional security such as data encryption as well as secured voice and text messaging.
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ForResearch In Motion Ltd (NASDAQ:BBRY) (TSE:BB), this is a much-needed win as the company has struggled to find success in the enterprise market. While a small contract, it represents one of the company’s largest ones to date for the BlackBerry 10, reported CNET.
Long-term revenue comes from this avenue and with consumers still being fickle about the brand, this is where the company is trying to go.
The EU seems like is a good place to start as its governments are still big BlackBerry user. However, a few months ago the U.K. government gave the green light for use of the iOS 6 operating system phones, suggesting change is coming for Europe as it looks at smartphone rivals.
Back in the U.S., the one-large enterprise users are increasingly unhappy with the older BlackBerry platforms and change is also coming. The U.S. Immigration and Customs Enforcement (ICE) agency and the Pentagon said in November they would start making the move to Apple Inc.’s (NASDAQ:AAPL) iPads and iPhones.
While BlackBerry seeks to make a fresh start with its new platform, there’s already signs of trouble.
On Monday, reports came out that United Kingdom’s retailers and carriers have been cutting prices on the new BlackBerry Z10 over the last few days, suggesting sales aren’t going well.
Some analysts speculated the cuts on the device came as it’s not high end enough as compared to the iPhone and Samsung Electronics Co., Ltd. (LON:BC94) (KRX:005930)’s Galaxy SIII.
Pacific Crest analyst James Faucette noted, “The case for [BlackBerry’s] recovery has been that in the long run, the company could return to selling high-end handsets that would feature enough profitability that handset profits could more than offset long-term declines in the highly profitable service business.”
“We believe that meaningful price cuts so soon after launch while probably at the initial discretion of the carriers, is likely to relegate the Z10 to being a mid-tier device with very low gross margins,” He added.
Along with rising red flags, expectations are dropping as the BlackBerry awaits its U.S. launch this month.
For BlackBerry, it already faces an uphill battle for share in the North American market as it only had 2 percent in the fourth quarter, reported Reuters, as compared to its 3.4 percent global figure.
U.S. consumers are a tough crowd and after reading the increasing negative reports, it may be even more challenging now to win back the Crackberry devotees.
Research In Motion Ltd (NASDAQ:BBRY) (TSE:BB) is currently down 1.01 percent, trading at $12.68.