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RIM's BlackBerry smart phone (Fred Lum/Fred Lum/The Globe and Mail)
RIM's BlackBerry smart phone (Fred Lum/Fred Lum/The Globe and Mail)

RIM suffers first quarterly drop in smart phone shipments Add to ...

In yet another bit of bad news for Research In Motion Ltd. , new data from research firm IDC show the BlackBerry-maker suffered its first year-over-year decline in global smart phone unit shipments in the third quarter of the calendar year.

Separately on Thursday, RIM also revealed that yet another executive was leaving the company.

Even as RIM launched new devices running the BlackBerry 7 operation system and reported in the second fiscal quarter that the BlackBerry subscriber base increased by 40 per cent to surpass 70 million users, RIM slipped 4.8 per cent to last place among the top five smart phone makers. Its market share for all device shipments was only 10 per cent. Global unit shipments at RIM fell to 11.8 million devices in the quarter, down from 12.4 million in the same period a year before, even as RIM remained far ahead of those device manufacturers below it on IDC’s list.

The news comes as RIM’s stock price fell below $20 (U.S.) for the first time since 2004 this week, and as the company attempts to move to a new, more advanced operating system promised for 2012 that is based on software acquired from QNX, a company RIM bought last year. Since 2004, IDC has tracked smart phone growth that has showed consistent year-over-year increases of devices being shipped out into the market. But this was the first year for RIM in which IDC’s figures registered a loss.

Also on Thursday, RIM said the head of its India operations, Frenny Bawa, had left the company to pursue other interests – the latest in a string of high-level RIM executives who have jumped ship. Her departure comes after a Wall Street Journal report in late October detailing RIM’s efforts to comply with the Indian government’s requests to monitor the Canadian company’s secure wireless messaging services.

Samsung, which has undergone a meteoric rise by powering its new smart phones with Google Inc. ’s Android operating system, took the top spot with 20 per cent market share and year-over-year growth of 223 per cent. Apple Inc. took 14.5 per cent of the market with its wildly successful iPhone, growing 21.3 per cent year over year.

Nokia , meanwhile, continued to stumble, falling 36 per cent year-over-year to have just 14.2 per cent of global smart phone shipments in the third quarter of fiscal 2011, down from 32 per cent in the same period last year. The Finnish giant, which is led by its Canadian CEO Stephen Elop, recently unveiled its new lineup of smart phones running Microsoft Corp. ’s Windows Phone operating system, which IDC senior research analyst Ramon Llamas said “marks the beginning of a new era for the company.” Many in the mobile industry think that RIM and Nokia’s Windows phones will battle it out for the third most popular smart phone ecosystem after Android and Apple’s iOS.

The firm noted that RIM’s shipments, as in previous quarters, “primarily comprised of older and less expensive models, leading to the company’s first quarter of year-on-year decline and a fifth spot... worldwide. Still, this was enough for Research In Motion to maintain a presence among the top five vendors worldwide, with a sizable margin ahead of the remaining vendors.”

Earlier this week, research firm Canalys reported that RIM’s market share in the United States, which is the Waterloo, Ont.-based company’s largest and most profitable market, had slipped to 9 per cent. Also this week, Toronto-based investment research firm Veritas put out a report that predicted single-digit market share could eventually be accompanied by a single-digit share price of less than $10.

“If it’s to turn the ship around in the quarters to come, the company needs its BlackBerry 7 devices to reinvigorate sales between now and the launch of QNX-powered devices,” IDC senior analyst Kevin Restivo said.

Meanwhile, two Canadian wireless carriers Thursday – Bell and SaskTel – discounted their supplies of RIM’s PlayBook tablet computer, slashing prices by $200. A 16-gigabyte version of the PlayBook is now only $299.99 at SaskTel, as opposed to $499.99 previously.

Follow on Twitter: @iainmarlow

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